Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-11-15
BOND BUYING BY u. S. BANKS
!. HELD KEY TO TRADE REVIVAL
Purchase of Government Securities In Open
Market Would Result in Commodity
Price Gains, Authorities Declare.

the supply Of money and thus also the
level OF prices9"
Gradual Purchases Suggested.
Perhaps It would not b necessary for
the Federal Reserve to buy half biz
lion dollars worth Of Government secu-
rifles all At once. It might start with
t2S.oooooo or sSo,oo0.ooo. then add 10
that amount from time 70 time IS con-
dttions warranted.
But the fact Is that the Federal RE-
serve banks, since August, have not been
adding Government obligations to their
portfolios. Seemingly, they have made
no effort to stem the, tide Of defiation,
which has now . strangelhold upon
American busiress-and world business.
But II for some reason the Federal
Reserve does not see 1T 10 undertake any
such stroke of economic craftsmanship
to cure the most important problem that
now faces the Nation, perhaps the Presi-
dent OF the United States, If public
opinion 80 demanded, might be willing
70 call a conference of the heads OF the
central Banks OF ell the great countries,
ct Warrington. This conference could
discuss openly the vast implications and
possibilities Of international cooper
alton in checking the disastrous defia-
ton movement and thus restore finan-
cial confidence In the world 'sby correct
ing the unbalanced distribution and
wastage Of the gold reserves Of the
world IN France and the United states,
which Is fundamentally responsible for
this critical situation"
OF course, the gradual accumulation
OF savings will in time build up a bank
ing surplus, which, when used, win bring
denation to halt. But that means
months, may be years, of bad business
and disorganized industry meanwhile.
Gold Standard In Danger.
Another thingl Gold standard advo-
Gates may wen worry over the present
prospects, for the gold standard Is In
serious danger If the drifting policy OF
Let the drift continue and countries
like Great Britain and Germany. S,If-
fertng from so-called gold standard. -
might conceivably kick over the traces
ana experiment with q managed cur
rency. That Is no idle possibility.
Many recognized world economists
like John Maynard Keynes of England
and DR.. Robert Eisler of Austria are
advocating openly the abandonment Of
the gold standard by the world in favor
OF a plan Of regulated currency, based
OH SIdDulzcu price IeVel, 70 meet the
| needs Of industry.
Those who believe such depressions
as the world Is now going through will
always reoccur, because history repeats
itself, should read these words OF Presi-
dent Hoover In his address before the
American Bankers Association recently
in Cleveland:
"The economic fatalst believes that
these crises are inevitable and bound 70
be recurrent . / would remind
these pessimists that exactly the same
thing was once said Of typhoid, chol-
era and smallpox. Science girds
itself with painstaking research to find
the nature and origin Of disease and to
devise methods for its prevention. That
should be our attitude toward these
economic pestilences. They are not dis
pensations of Providence, ! am conf
dent in the faith that their control, so
far as the causes lie within our own
boundaries, Is within the genius OF
American business"
Now Is the time Of times for science
and common sense to move into this
situation. Later 1t may be too late.
| tcopyright, 1890, BY North American News
paper Alliance,