Evening star., 1933-12-03
PREPARED
FOR NEW DECLINE
IN DOLLARS VALUE
Possibility Of S6.97 Pound
Spurs Plans to Guard
Empire Trade.
LONDON FAILS TO GRASP
AIMS OF U. S. POLICY
Still Attempts to Read Roosevelt's S
Mind on Orthodox Lines and
Ignores Progress.
,cial Dispatch to The Star,

Special Dispatch to The Star.
NEW YORK, December 2.-Cables
and wireless dispatches to Business
Week give the following survey of busi-
ness abroad for the week ending today
LONDON-The revolt of DR.. Sprague,
Mr.. Warburg and AL Smith is regarded
here as unlikely to check President
Roosevelt's monetary policies. London
is prepared for S6.37 pound, which
is SOC dollar.
What London has not yet grasped IS
that President Roosevelt, if his words
mean anything, is quite indifferent to
what happens to his external dollar.
London is still trying to read his mind
ON orthodox lines. There IS also a
strange ignorance of internal American
factors, so that dollar depreciation is
apt to be viewed as market phenom-
enon without reference to the genera!
progress of the Roosevelt plans.
British exporters are anxious over
the new competitive ability of American
exports under the deprecated dollar.
Chancellor Chamberlain declared this
week that trade is not yet hit, but the
government is ready to take steps If
Britain suffers from cheap dollar i'm
ports This means action not only by
Britain, but by the empire as a whole,
and the pound will be deliberately de-
prec!ated if necessary"
Trade Gains Continue.
At home, British recovery is making
steady headway despite the menace of
a cheap dollar and the probability that
France will leave gold before very long.
The recent splendid recovery of the iron
and steel industry and plans for ma
tionalized expansion of the industry
under the protection Of government
tariffs, is suddenly threatened by a
small group within the industry which.
unbalanced by the recent recovery, is
eager to break away from the joint
program Enough important leaders are
still in accord probably to end the dis
sension. but it has caused some worry
this week.
The stock market has had little turn
over. but there is firm tone with in
dustrials in favor There still are small
signs of heavy American buying. despite
constant rumors to the contrary. New
issues are again active, with favorable
response to most offers either for con-
version from high interest rates or for
new companies formed to amalgamate
old established businesses. Speculative
issues are few. Rubber restriction is
now expected early in 1884 despite the
opposition of native growers with a
consequent better tone for the rubber
and tea share market.
Paris Cabinet Disappointing.
PARASITIC new Chautemps cabinet
is disappointing from every angle largely
because it is a mere repetition of the
defeated Sarraut government. Mar
chandeau, who has been made finance
minister. is a hitherto unhead-of diplo-,
of Herriot, which probably accounts for
his presence in the government. HerrlOt
has been recognized to the extent that
he has been made special representative
to the League of Nations
The life OF the new government Is
problematic. II 1t were not for the
fact that France must handle the De
United States-and it will be refused
as in the past-the government might
be rejected at once. AS it is, Paris will
not be greatly surprised if it carries
on for the remainder of the year set
tling only routine business and side
tracking main issues.
Despite the political crisis. heavy
losses of gold for II consecutive weeks
Dy Jne Bank Oh fTdIlCe, anu Ille Sleduy
rise of both dollars and sterling over
the European gold currencies, the Paris
Bourse has been remarkably steady. AT
times it has even shown bursts OF
activity. There are still few signs that
France fears imitation, at least not to
the extent that the French are shipping
much capital outside the country
Hoarding at home continues unabated
Surtax Becomes Issue.
For some time there has been a sur
tax of Is per cent on British imports
in part to counterbalance the deprecia-
ton of the pound sterling. Within the
last few weeks the need Of the French
treasury to carry out some short-ternl
borrowing in the London market to meet
current budget expenses has caused a
controversy over the surtax, for the
British declare they will not make the
necessary loans until the French lift
this special barrier against their goods
1t is generally thought in Paris that
the demands of the British banking
houses and insurance companies have
been sufficiently firm that the French
be obliged to lift the tax, for borrowing
will become necessary shortly to keep the
treasury af1Oat