Nogales international., 1933-05-06
Hx Frank Parker stockbridge

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The United States of America has
gone off the gold standard" That
sounds shocking to people who
all change, and it takes
some mental adjusting on
the part of the rest OF
us who have not yet become accus-
toned to the rapidityt with which
everything is changing today.
What does it mean, this going off
gold? What is the purpose? What
will the effect be? What has it to
do with this talk about initiation?
What is initiation, anyway? Who will
it benefit and who will it hurt,
Those are the questions on the tip
of everybody's tongue.
In Sequence ,
The United States went off the
gold standard on March 4, when
President Roosevelt declared an
embargo on shipments of gold
abroad and called all boarded gold
back into the Federal Reserve
Banks. Since then we have shipped
no gold abroad except on contracts
already entered into. Since then no.
body holding gold certificate or
other paper money calling for pay
ment in gold had been able to get
gold for it. We still have the gold,
nearly half of all the gold there is
in the world, more than four thou
sand million dollars of it in our
Treasury and banks, but we have
stopped using it.
The purpose of our action is, as
President Roosevelt stated, to bring
about higher prices. The first place
it has affected prices is in our for
eign trade, for the principal use OF
gold as money is in settling trade
balances between nations. It is the
one commodity which every nation
in the world accepts as money.
Immediately we went off gold,
commodity prices in international
trade began to rise in terms OF dol
lars. For as soon as any nations
paper money ceases to be redeem
able in gold, people who have that
money begin to look for something
else-wheat, tobacco, cotton, lard,
steel or other non-perishable forms
of wealth-in which to redeem it.
They begin to buy those things, and
their paper money buys less Of
them than it did before. In other
words, they bid prices up.
III Farm Products
It may seem to some that we in
America are not concerned with
what happens in foreign trade. But
it is from our sales overseas tina.
a very large part of the money corr
es, which pays for our farm pro-
ducts. More than half of all cotton
grown in America must be solo
abroad if the growers Of the South
arc not to suffer. In Texas alone,
it has been figured out, the loss to
the entire state from the low price
of cotton in the export trads.. has
been over $400 for every family III
the state!
Almost half of the money which
tobacco growers get for their crop
comes from foreign sales. We nor
mally sell. abroad from a quarter to
a third of all the lard we produce, |
about one-sixth of our wheat and |
about the same share of our apple /
CROP more than half of our tl1r-
pentine, gasoline and benzol, over I
a third of our copper, and FROM a
quarter to one-half of our factory !
products in many important lines.
It seems highly important, then,
to get the highest possible prices
for these goods in the world mark
ct. But when foreign nations have
let their money depreciate they can
not buy as much or pay as good a
price, so long as we maintain our
dollar on the gold basis. On the 9TH
er hand, with their cheap money,
they can produce at less cost than
we can and sell thtir goods to us for
our gold dollars cheaper than we
can produce them when all our costs
are measured in gold
How Producer, Is Helped Il
So in going off gold we have
cheapened our dollar to meet the
other cheap moneys of the world,
and already commodity prices have