Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-09-30
AMERICAN DOLLAR
GAINS IN PRESTIGE
U. S. Gold Money Is SuppIant-
ing the Pound in World
Markets.
BY J. r. BRACKET.
Associated Press Business writer


NEW YORK, September so.-Tha
American dollar is rolling speedily
forward into new fields of interna-
tional finance-while the historic pound
sterling fiutters In the wind and the
franc wheels steadily along. an nm
known quantity.
Pushed of the gold standard, the
pound has become an uncertain me-
dunn of foreign exchange. An inter
national trader who bought goods on
the sterling pound basis in the morn
ing may find that pound higher or
lower in value by night, with the re-
suit that he does not know the amount
he must pay.
Dollar Position Strengthened.
Money in international trade works
something like this:
Germany buys wool from Argentina
German marks are none too stable In
value and Argentina insists on another
medium Of payment. So Germany
takes her unstable marks and buys
dollars, because the traditionally Arm
pound is wavering Argentina converts
the dollars into iron in America and
the course of trade goes merrily along.
For scores of years the pound sterling
has stood on the highest peak, the
sympol OF unchanging strength. Now
tne dollar seems in the way of OBJ
tanning some of the pounds lost
prestige
Already several American and Brit
Ism nrn1s are in dispute regarding the
amount of payment due on sales con-
tracts on American imports into Great
Britain before the pound slipped of the
gold standard. British firms cabled
oners 70 American exporters In
pounds. The Americans accepted and
woke to find the pound not worth what
they believed 1t was when they sold
the goods.
The pound has been worth In terms
OF dollars around $3.50 at one Of the
low quotations. A few DAYS ago IL
was worth S4.S6. The American ex-
porter who sold for $4s6 pounds thus
loses $1.36 at the bottom figure.
London also has suffered a loss in
prestige in the acceptance market. Bills
OF acceptance are heavily guaranteed
notes OF business men. They are sold
by business men at a discount for
money credits with which to carry on
their commerce. Hitherto London has
been the big market. But now business
men see the pounds they have on credit
QcJcEIOTdIllB IN value. AS result the
acceptance market in New YORK has
taken on an increasing amount of bust
ness.
Currency DefiatiOn.
Frances position Is uncertain. She
had large balances in London. over
night these balances lost a substantial
portion Of their value, Frances huge
gold holdings, however, and her relative
unimportance in international trade
have made her comparatively safe from
the international viewpoint
II other European gold standard ma
lions generally slip of gold, then the
pound can be kept pegged at fairly
stable level and 1t might regain its
prestige. Several nations, however, de-
hated their currencies after the war,
as England has not. France also has
more than $4,000. 000, 900 in gold, much
more than enough for reserves. She has
moderate loans throughout Europe and
is in a position to keep on lending. She
may usurp England's financial domi-
nance In Europe, but she Is additionally
backward in international finance, and
many international bankers in New
York look for England to come back.