Carolina watchman. [volume] (Salisbury, N.C.) 1871-1937, 1932-01-08
Uncle Sans Golden
Yardstick Measures
All World Money
BY CALEB Johnson


the world over. That is not because
gold in itself is any more valuable
than any other metal, but because it i.
rather easily stored and does not rust
or corrode. When it comes % actua.
value in usefulness, there is no doub,
that a ton of steel or of copper il
more useful than a ton of gold.
But from time immemorial gold has
been the principal standard of wealth:
as it is today practically the worlds
sole standard. 1t is a yardstick, in
fact. All units of measure are arbi-
trary. They represent something
agreed upon between individuals and
nations, and individuals and nations
are unanimous in agreeing that gold,
measured by weight, is the standard by
which all money and all wealth is
measured. For thousands of years,
when silver was less plentiful than it
is now, silver was the principal money
standard in many parts of the world
and until comparatively recent times
both silver and gold were used as
measures of wealth everywhere. Until
after the great European wa the gold
unit, by which all other money and
wealth was measured was the English
pound sterling. 1t is curious that the
name of this unit comes down from
the days when silver was the stand
ard. A pound in money was a pound
of silver. But by the early part of the
nineteenth century silver had begun
to be so plentiful by comparison with
gold that it no longer served as the
best standard of money, and first Eng
land and then one by one the other ma
lions of the world accepted gold as
the sole monetary standard. The val
lie Of the gold pound, measured by
United States dollars, is $4.8665. That
represents substantially a quarter of
one ounce of the precious metal,
which is SO compact that a bar of gold,
6 "a inches long, 3 IL inches wide,
and l "a inches thick, is worth $10,-
600.
All over the world statesmen and
economists are now discussing the pos
sibility of arriving at some new agree
ment by which silver will be restored,
in part at least, to its former position
as a standard Or measuring stick for
money. And the reason for that is that
with the exception of the United
States and France. none of the great
nations of the world has been able to
hold on to enough gold to be able to
pay its bills in gold when gold is ask
ed for.
The English pound is no longer the
standard money of the world. The
American dollar has taken its place.
For England went off the gold stand
ard last summer and the pound today
represents merely the British Govern
ment's promise to pay. And the Brit
ish Government is in such serious fl
nancial difficulties, as compared with
the United States, that the price Of the
paper pound has been as low as 500,
and we'll under $3.50, instead of $4.-
Sc, for several months past.
In other words, the nations of the
world are measuring their money and
their wealth by the standard Of the
United States dollar. That is because
we have in the vaults of the United
States Treasury, the Federal Reserve
Banks and other banks, the largest
volume of gold that has ever been &C
cumulated under one flag in the his
tory of the'world. We hold, in round
figures, about forty-five hundred
thousand thousand dollars $(4,5e0,-
ooo,ooo) worth of gold, France has
between two and a half and three bill
lion dollars worth of gold behind its
currency.
The trouble in England has been
that her trade with foreign nations
got to a point where she could not col
lect gold for the commodities she ex-
ported as fast as she had to pay out
gold for the commodities which she
imported. For while gold cuts very
little figure in business transactions
inside of national boundaries, it is the
only universally acceptable medium of
exchange in international trade. So, in
order to prevent the complete loss of
all Of her gold reserves, England had
to begin to refuse all demands for
gold and to offer instead unsecured
promises to pay, which is what the
notes of the Bank of England amount
to today. Nobody questions that event
ually England will come back to the
gold standard. Nobody in a position to
prophesy, however, is >,wi1ling to pre-
dict how long it will be before that
happens. In the meantime, the money
of the British Colonies has deprccia-