Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-12-02
SILVER DISCOUNTED.
AS MONETARY UNIT
Bank Does Not Believe 1t
viii Be Generally Ac-
copied for Currency.
BY the Associated Press.

NEW YORK, December 2. Silver,
which in the second half of this year
has stepped into the spotlight Of spec
ulative attention, stands little chance
of being accepted as a monetary unit
by nations of Europe or the American
continents, says the National City Bank
in its monthly review.
The once popular metal enioyed a
sharp advance in price in the last sew
eral months, but has recently lost much
of its gain. From price of 1884 cents
an ounce, an aQ-time low established
last February it has moved up to a
spot price, New York, Of 1874 cents,
with october futures moving above 40
cents. From those levels it quickly
dipped back below the 3O-cent level
Speculation, during the period Of ad-
vance, reached the highest point for
1881 to date.
Economists Claim Disputed.
The review takes issue with claims
of many economists that the prolonged
drop in silver is one Of the principal
causes for the present depression. It
points out that China and India are
the principal users of the metal and
adds: Were it true that cheap silver
has reduced the purchasing power If
China as much as has been represent
ed, it ought to show in the trade Iig
ureS. AS matter of fact, these show
that Chinese imports have fallen off
by percentage not materially greater
than that for world trade in general"
1t is q mistake to assume to the re-
monetiZatiOn Of silver would speedily
result in large additions to the none
tary stocks of the world, the review
points out. In fact, India has melted
down and sold 100, 000,000 ounces from
its silver stores and this has had de-
pressing effect upon the silver market.
Cheap silver, it contends, is a result,
not a cause, of the depression.
Referring TO the prospects Of silver
being restored to use on widespread
scale as a currency in this country and
Europe, the banks review states:
RECOMMENDATION of silver by western
nations would help the price, of course,
but there seems little prospect of such
action at this time. In the absence of
conclusive evidence that the low price
Of silver has been an important factor
in the depression it hardly seems prob
able that these countries will want to
make such a fundamental change in
their banking systems to less con-
yenient metal solely for the purposes
VI bNAICliJillS SlINNI PAOSIhSNIo' Nm
ilarly, it is doubtful whether at this
time. when budgets everywhere are
being carefully scrutinized. it would be
possible to persuade those countries
which have ceased to use silver for
subsidiary currency to return to this
metal when it Is cheaper and just as
satisfactory to use paper or alloys"
Banking Conditions Improved.
The review states that banking con-
ditions have definitely improved, in
dorses the formation of the National
Credit Corporation as a worthy sup
porting effort and refers to the Ger
man financial situation as the most
important European problem Of the
day. It states that the French are
practical people and know how vital
is complete settlement of the repara-
lions problem to Europe and to the
world and they know that settlement
rests with them"