The Washington times., 1924-03-19
EUROPE NEEDS
REFORMS Of
CURRENCY
Great Britain Is Only Nation
Meeting Debts, and Is Really
on Gold Standard.
BY DAVID M. CHURCH.
Copyright. 1924, by Cosmopolitan
NeWa HervicAN

NCOpyIIBnt' iva, Dy Cosmopolitan
News 6ervice.l
LONDON, March 19-Urgent need
for currency reform in Europe is
seen when exchanges are viewed in
retrospect.
The principal Continental coun-
tries have made little or no effort
to restore the gold standard, but
contrarily have pursued a policy of
initiation in preference to the more
effective. but less pleasant, policy
OF reducing expenditures and in
creaging taxation in order to Sc.
cure balanced budgets.
Drastic and sweeping fluctuations
In European exchanges during the
past year, have apparently had
little or no effect, and there are
indications of fluctuations Just as
wide during the present year, UNI
less some OF the Continental gov
ernments perform q vote face and
change their budget habits.
The salutary effects of trade re-
vivals are being constantly offset
by increased governmental expendi-
lures, which are having an adverse
effect upon exchanges.
Heavy Losses in Values.
Without exception, during the
past year, all of the principal cur
rencies Of Europe have deprecated
in terms OF United States gold
dollars. Not counting the total ex-
tinction Of the German marks
value, the heaviest fall, 80 per cent,
occurred in the Belgian franc, the
French franc coming second with
q loss of more than 80 per cent.
Norwegian, Spanish, Italian and
Danish currencies all showed sub
stantial depreciation. while the
pound sterling fell more than six
points, the least Of all.
The advent Of a new fiscal year
is bolstering up European ex-
changes for the present, but, once
the new budgets are well under
way, 1t is most probable that the
decline will again set in and will
follow the curve OF increa sed gov
ernmental borrowing and spending.
Almost two years ago at Genoa
an allied conference recommended
that there should be a conference
to discuss currency and banking
questions.
The financial experts at Genoa
declared that the first country
which boldly returned to the gold
standard by devaluation would
work a great boon for the world
These recommendations were hailed
and welcomed When the Genoa
conference ended, efforts ceased.
with the exception Of Great Britain
Preparations problems are undoubt-
eddy at blame for the reluctance on
the part of central banks in Europe
to come together and discuss cur
rency reform.
Chase Preparations Butterfly.
European bankers, influenced by
European politicians, are con-
stantly chasing the reparations but
terfly, and living in hopes that
from the defeated enemy there will
come enormous sums to bolster
their sadly sagging treasures. Until
there is some definite reparations
settlement to dispel these illusions
the chances are small for any cur.
rency reforms.
Meanwhile, the governments of
Europe. which are powerful, are
resorting to artificial means to
bolster their currencies, and the
governments which are weak are
watching their currencies plunge
downward unchecked.
While trade prospects nre
brighter throughout Europe, money
conditions are not. Favorable
trade prospects for the present
year probably will not offset un.
favorable money conditions.
With the French franc, at
hitherto unprecedented figures, and
the British pound unstable, and the
German mark almost a negligible
currency, 1t is easy to see what
an enormous obstacle to trade may
come from governmental reluctance
to ADOPT drastic currency reforms.