The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1933-12-29
These developments are {:

These developments are:
l. To initiate negotiations for in
ternational currency sterilization.
2. To ask congress for authority
to seize from federal reserve banks
the gold profit inherent in devalu-
alton of currency.
Seizure of gold profits incident to
devaluation is logical step after
concentrating gold in the treasury
and in the federal reserve banks
which was the effect of the order
issued yesterday by acting Treasury
Secretary Henry Morgenthau Jr.
Gold Market Possible
A treasury official expressed the
opinion today that ultimately free
gold market may be established by
the United States. But, he said, the
disposition of gold profit should be
established regardless of profit. A
principal objection at this time to 81
free gold market is that it would
put a substantial premium on some
5000 100000 of gold and gold certifi-
Gates now boarded or for other
causes, privately held.
The third of the factors in de-
velopment of the currency program
is continued increase of the govern
ment's open bid for gold. 1t stands
today at $34.06 an ounce. 1t was
$20.67 an ounce when Mr.. Roosevelt
began to buy gold through the RFC
two months ago.
The United Press was authorita-
lively informed today that the fore
going represents administration cur
rency detectives.
Sterilization Not Determined
From the same source a fortnight
ago. the United Press was able to
obtain unqualified assurance that
failure for many days to increase
the gold bid from $34.O1 did not
mean sterilization of the dollar but
would be followed by higher bid.
1t came shortly thereafter.
Considerable time is expected to
elapse before Mr.. Roosevelt gets gold
up and the dollar down to his salts
faction. If domestic and world
trade conditions react satisfactorily /
to price well under the expected
SO per cent devaluation, gold would
be permitted to stop short of that
mark. But the effort for interna-
tional agreement is said by informed
persons to be inevitable.
Failing such agreement it would
be comparatively simple for Great
Britain and France to devalue their
currency below the final American
sterilization figure, thereby making
1t more expensive for the world to
our surplus goods for con-
abroad.
Silver Action Undecided
The foregoing does not take ac-
count of silver and what Mr.. Roose-
velt intends to do about it. Full eff
feet OF the limited coinage program
last week must be
by the administration be-
fore it can be known whether silver
shall receive further aid.
Other nations signatory to the
London silver agreement have yet
to put it into effect. Nothing more
is expected on silver from Wash
ington until the other signatories
are heard from.
Seizure of gold profits from the
federal reserve banks would be by
means of legislation calling into the
treasury all gold of which the
twelve banks hold S3,600,000 900.
The nations gold stock is S43OO,-
100000. Penalties for non COM
pliance would bring virtually all Of
it into the treasury in exchange for
gold notes on the basis of gold at
S20.67 an ounce.
Profits to Treasury
After Sterilization, holders of gold
notes could exchange them for metal
but at the new gold rate. If it
were S41.34, the note holders would
receive in exchange only half as
much gold as they originally put
into the treasury, but it still would
represent the same Il
dollars.
Foreign governments which de-
valued and then stabilized their
currencies unifo1 My arranged it so
that the inherldt profit accrued to
their treasures. Sterilization here
without some such arrangement
would deliver the proft-s3, 100000
700 for the reserve system if the
dollar We're cut in half-to the re-
serve banks which are privately
owned.
Such profit accruing to the treas
lry might be used to retire public
debt or meet current expenses