Evening star., 1933-12-24
BUSINESS AWAITS
WORLDS REACTION
ON SILVER POLICY
Stable CurrenCies Regarded
as Vital Necessity in
FOREIGN Trade.
BY JOHN A. CRONE.
Special Dispatch to The Star.


Special Dispatch to The Star.
NEW YORK, December 23.-The
world Of commerce and trade here was
as joyful about President Roosevelt's
silver program as is the average healthy
youngster viewing his first snow. And
like this youngster. they were cautious
about slipping and falling. They agreed
that the presidential proclamation was
bulliSh. but how much so, and in what
detail, none ventured to predict.
Foreign trade circles agreed that any
move toward world currency stability
was highly desirable. Before making
statements, however, exporters and i'm
porters said they wanted to get word on
the action of the other four silver-pro-
ducing countries in the international
agreement reached at the London Eco
nomic Conference-Australia, Canada,
Mexico and Peru.
Meanwhile spectators rushed in for
silver futures, the shares of silver-pro-
ducing and consuming companies, and
of companies that operate within the
borders Of silver nations. Bullion deal
ers, supplying the arts and industries
with silver, at once differentiated be-
tween the Government price for silver
and the world official market price and
decided that the trade quotations would
not be based on the Governments pur-
chasing price. because the latter applies
only to American silver mined after
December %, 1893.
Caution Apparent.
In various commodity circles, outside
OF silver, there was also some caution,
although a long list of exports to the
s1lver-using countries might well benefit
from this silver program. Money
changes by themselves, leaders in for
eign trade were quick to point out
would not change the world situation
unless trade increases followed. Politics
here is the thorny point. If the five
producing nations take similar
action and If the principal consuming
nations, China, India and Spain, carry
out the details of the London agreement
world trade should be beneffted If,
however, there is an attempt on the
part of some of them to erect fresh
trade barriers, the silver program will
accomplish little.
One point that received little atten-
ton either in speculative or business
circles was the price fixed for silver.
the 64l2 cents an ounce level is
equivalent to the average price of sill
yer from the latter half of 1921 to the
latter half of 1925. The range of silver
during these five years was from So
TO 66 cents an ounce. Thus President
Roosevelt is carrying out in detail his
program to lift commodity prices to
levels prevalent In 1926.
Banks with branches in Bombay,
Calcutta, Shanghai and London pro-
fesSed as much puzzlement about the
ultimate effects of this silver buying
program as did foreign trade experts,
Bankers did not know whether to ac-
cept the orthodox view and say at
once that silver using nations would
be ruined through flow CT imports,
which would have def1ationary effect,
or whether to hail the newer belief
that the plan would lift buying power
in those nations.
Exporters pointed out that we send
to China, Japan and Netherland. India.
large quantities Of raw cotton, some
wheat and wheat -four, tobacco leaf
and cigarettes; lumber, considerable
petroleum and its products, automo-
miles, accessories, tires, rosin. milk,
both condensed and evaporated; some
steel and iron, industrial machinery
and paper.
Importers observed that we bought
from these countries sausage castings,
eggs, goat ana KID skins, furS, briStles,
feathers, various oils such as those
from tung, soybean, peanut and per-
lila; tea, carpet woods, silks, tungsten.
antlmony, tuna and crabmeat, cam
phor, toys, hat materials, coffee, pep
per, molasses, rubber, varnish gums
and resins, copra, palm oil, citronella
and lemon grass oil, SiSal and hene-
quen, kapok, paraffin and tin.
All OF these items and many other In
ternational articles of trade might well
De affected by this silver movement.
The effect on Latin American silver
countries might come through a series
OF exchange and trade agreements ne
gotlated with Argentina, Brazil and
other nations.
Manufacturers Of mining machinery
viewed the purchasing program
hopefully. They pointed ont that the
mixed-ore mines-that is, mines where
silver is found in association with other
metals such as copper lead and zinc
might increase production to get the
benefit of the Governments silver plan.
In the past the machine makers have
had orders largely from gold-mining
concerns. which seldom buy machinery
in the quantities taken by extractors OF
the baser metals.
Expect Indirect Spur.
The industries and arts feel the Gov
ernment silver program will stimulate
demand indirectly. Given higher val
lie officially, silver to a certain extent
takes on added value in a long line of
items starting with silverware itself and
extending TO less spectacular industrial
uses. Repeal recently created a heavy
demand for various types of silverware.
Last year only 5 per cent OF the
United States silver consumption was
for coinage. The rest went into various
industrial and art uses.
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