The Washington times., 1929-03-05
RESERVE BOARD
! REP0RTS ON
GOLD
BY HARRY GUSACK
, Financial Editor

: Ine gold standard mas Deeh re-
established as the basis of national
ourrencies throughout the world,
according to the annual report sub
mitted to Congress by the Federal
yReserva Boafd. t
7 During 1928 the establishment
Of the gold standard throughout
sthe world was completed with the
Faxception of a few countries.
Italy returned to a gold basis on
December %, 1924. just prior to
the beginning of the year; soon
afterwards sEstonia, Norway, and
Greece returned to gold basis,
land Aon Junes>25 monetary reform
swas effected BY France. On Novem-
ber % the parity of the Bulgarian
elevel was fixed by law at a level
approximating that which had pre-
evatled since the end of 1923 ($0.0072,
equals levas per gram of fine
gold.
IL Currencies of nearly all the prin.
fcipal countries now bear a definite
relationship to gold, and their gold
parties are in the majority of cases
q matter of administrative practice.
The return to gold has reduced the
dangef Of wide fluctuations in
foreign exchanges and has removed
the obstacles of international trade
arising from uncertainty of cur
rency values.
The progress of the gold standard
tduring the past year has been ac-
.companied by the Withdrawal of a
considerable amount of gold from
the United States,
Telephone Earnings
The report of operations of the
Chesapeake and Potomac Telephone
Company, just filed with the Pub
lie. Utilities Commission, shows that
Telephones operating revenues for
the month of january We're $705,.
664. Operating expenses were
S482,692, making net revenues for
the month S222,972. +
Taxes assignable to operations for
the month of January We're $52 ,022.
Plant and equipment added to
the telephone system in the Dis
amounted to $196 ,669 Retirements
duriHg9 thes month were $14S,355,
making net additions $4S,314. !
At. the CLOSE Of, business january
31, there We're f51,2S5 telephones
connected with the central offices
serving the District of Columbia,
which. was an increase of 925 tele-
phones for the month. In January,
Washington telephone users made
1920, 900 local and $4,000 out-of
town calls. This was an increase
of IL per cent in the local calls and
13 per cent in the out-of-town calls
oyer the esafpe month In 1928. Il
~ = 4SsE = A&
Enflation Seen
The National City Banks review
of February business and money
Conditions strongly supports Federal
Reserve Board policy and deplores
what, 1t terms the wall Street
vortex which has caused interest
rates to stiffen and foreign ex
change to weaken. The bank makes
the bald statement that the dis
crepaney between credit and bust
ness rates Of expansion can only
mean initiation.
The bank finds volume of manu-
featuring and trade in February
SET a favorable record. 1t finds
little evidence that general business
has been hurt by higher interest
rates.
!: The report compares earnings of
300 corporations for the past three
years, showing that 1928 cravings
gained ia per cent over 1927, but
that prosperity has not been shared
in. equally by all branches OF in
dustdy
Commenting on advance in the
Bank of England rate to 512 per
cent, from IA per cent, the bank
says
@Action by the Bank Of England
was the direct result of the disparity
existing in interest rates between
New York and London and Illus
trates the disturbing effect which
the speculative boom in this coun-
try is bound to have on the inter-
national money markets. High call
rates here not only are acting as a
magnet to attract the floating sup
plv of funds the world over, but
are hampering the sale. in TINS
market of foreign securities when
heretofore have been leading fac
tor in settlement of the balance OF
payments on merchandise, trade
and interest account. AS con-
sequence, the leading exchanges
have become so depressed that
other countries than England may
eoon. fnid themselves facing the
alternative of either submitting to
a drain of gold or of imposing upon
their trade and industry the burden
of higher interest rates.
THAT the Bank of England has
been particularly reluctant to bring
about tighter money has been
evident, and its reluctance Is readily
understood in view of the depres-
sion existing in many lines of Brit
ish trade. For nearly two years
the policy OF the bank has been
directed towards the maintenance
of stable credit conditions as a
and, considering the difficult condi-
tioins that have had to he met, the
bank has been remarkably success
full in carrying out its purpose.