Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-10-04
Continued From First Page.)


East and want to regain their old posi-
ton. The bankers who finance COM
merce. both East and West. Shipping
groups plying the sea lanes to and from
the Orient The silver producers. I'M
perialists who believe that the silver
poultice. applied to India. will draw out
the poison Of political unrest and COOK
Mahatma Gandhi's goose.
Used rs Gandhi Weapon.
These, elements are backed by the
general realization in Britain that there
is no use balancing the budget for 1881
and 1852 II the general price level goes
on falling and Britain's export trade
shows no expansion. Tariffs now on the
way would reduce imports, thereby i'm
proving the trade balance. But unless
the prices Of primary products rise the
purchasing power of Britain's customers
will remain lew and. therefore, the eX-
port trade Of Great Britain also Will re-
main low.
The problem of lifting the prices Of
primary products thus becomes of FIRST
Importance Because prospects are that
some time will e,apse bciNre the great
masses Of gold in America and France
are pumped back into the worlds eco
nomic machine, British opinion was In
creaSingly in favor Of attempting TO
bring about a rise in the world price
level.
The Macmillan Committee on Finance
and Industry, in recently puonshed
report, went extensively into this Ques-
ton Of raising price levels but kept OF
the controversial silver issue and ad-
vocated concerted action by the central
banks of the oh ef creditor states. The
pro-siiver crowd say that the central
banks will not join in a concerted ac-
ton. They urge that the y tai thing is
the rehabilitation OF silve-. revitin5 the
purcha sing pov-r of the Far East and
thus stimulating world trade. BESIDES,
it would lessen the painful readjustnlent
neeGed in Britain, WHICH othel :. 4Se
would be necessary in order to bring her
prices into equilibrium with the present
low levels of world prices.
Silver Price Drops.
It has been pointed out that 700 00o,-
600 people-namely the population OF
China and India-use silver as a basis
OF value. And silver has dropped from
high of s1.8o an ounce in 1920 to q
low Of less than rs cents in 1881, and Is
also i'll heavy oversupply.
On the other hand. gold, expressed In
terms CT goods commodities and serv-
ices, has risen Steeply in value and Is
in heavy under-supply. relative to the
world needs. Il is OBVIOUS that this
markets Of the E s.. while by-productS
are bursting the warehouses and gran
aries of the West.
China and India are the two coun-
tries vitality interested as consumers.
Mexico, Peru and the United States,
producing b:Aween them toby 175.000,-
900 ounces OF silver out of a world pro-
duction of 244.O00.000 ounces tthe fig
ure was 262 0000 ounces in 1920 are
the Countries primarily interested as
producers. In between comes Britain,
neither consumer nor producer, but In
terested primarily in the trade stand
point, with the secondary angle in In
dia.
BimetaIlists Active.
These immense, powerful interests
have been talking bimetalltSm and urg-
ing international action 10 give silver a
higher status and stabilize its value at
higher price than now prevail s. One
may quote this typic-f instance: Sir
Hugo Cunliffe Owen, millionaire head Of
the biggest tobacco group (Which still
reports a S5,000,000 profit. despite the
depression who insis:s that concur
rently with the budget balancing meas
ureS, the national government should
call conference CT Western p wers to
tackle the problem Of restoring the
buying power of silver throughout the
East
1T is computed that these peoples have
boarded wealth of 1000, 100000 ounces
Of silver" says Sir Hugo. That silver
was worth s4.500.000 900 in 1929-now
it is worth under S2.00O.000, 900, or
much less than half. The three-fifthS Of
the world population who use silver
have had their wealth so much reduced
that they no longer buy from the two
f1fthS and therefore our trade with the
three -fifthS is being reduced to the van
ishing point. Let us now face these
facts to which the leading economists
and industrialiStS here and in the
United States are fully alive. Let US
silver back to a fair price. 1t can be
done. Why don't we do something about
it? The world production Of silver in
1890 was under 5000. 900 ounces and
the annual consumption is estim1t ted at
230,000,000 ounces. Are we gcing to
suffer this increasing depression for the
sake of 100000 ounces of silver which
Is worth today in gold less than Ell ,0o0,-
Ooo."
Sir Henri Deterding. the head of the
giant Royal Dutch Shell Oil combine,
echoes the words of Cunliffe-Owen.
Neither Of these men suggests in so
many words the reconciliation of sill
yer. Interests that turn pale at the
gills at the mere hint of bimetalliSm
appear ready to support an interna-
tional scheme to raise the price Of sill
yer so long as they are sure that this
move will not start a landslide toward
silver In Britain and other European
countries that will give the radical ele-
ments a chance to use such slogan
man named William Jennings Bryan
onto the national American stage.
Obstacles Are Many.
The snags in the way of raising the
price are numerous enough as 1t is.
Silver largely a by-product Of the base
metals, Is in oversupply In 1880 Mex
leo produced los 100000 ounces. the
United States more than 100000
ounces, Peru more than 10000 900, and
this aggregated only 10 per cent Of the
this new production large supplies Of
silver have been set free by the de-
monetiZation of silver coinage.
Following the postwar sterilization
Of currencieS on a gold basis. European
countries made it a practice to reduce
the quality of new silver coinage. The
old coins that were withdrawn from
circulation provided not only the silver
required for the new coinage but also
surplus quantities Of silver which
found their way into the market aug
menting to an important extent the
supplies Of the new-mined metal.
The stocks Of silver held by the gov
eminent of India are huge despite
heavy realizations over the last four
years = which sales have helped the
downward trend Of silver prices. Sir
George Schuster, finance member of
the executive council Of India, felt
constrained to point out lately that
India Is large consumer Of silver, the
purchases made by her people over q
corresponding period outweighing the
amount sold by the Indian government.
But so far as the market value of silver
Is concerned this Is an eyewaSh be-
-