Evening star., 1933-09-03
Currency and Credit Policy
Unchanged by Easing of
Gold Embargo.
N. R. A. PLAN AT WORK,
TRADE FORCES AHEAD
Spectators, Impatient to Reap
Profits, Want Administration to
Use Artificial Stimulants.
BY CHARLES r. SPEARE.

BY CHARLES r. SPEARE.
Special Dispatch to The Star.
NEW YORK, September 2.-Lttle
encouragement has been given this
week to those who would carry the in
flation program to its extreme limits
and either issue non-interest-bearing
Treasury notes or effect a devaluation
Of the dollar.
The meeting between President
Roosevelt and Gov. Norman Of the Bank
of England, from which much was ex-
pected, was barren of results. The
dollar dropped sharply to discount
nearly as great as in July, and then
recovered
The executive order lifting the en-
barge ON newly-mined gold provided
basis for raising the prices of gold
mining stocks, in allowing American
producers of the metal the additional
profits realized from an outlet into
the free gold markets of the world.
This, however, did not change the
currency or credit policy Of the Gov
ernment, which remains one Of en-
ploying the Federal Reserve to stimu-
late banking operations in behalf Of
borrowers by means of larger purchases
Of Treasury obligations. And this at
q time when loans maturing at the end
Of December are available in large
amounts at less than l per cent.
It is apparent that the administration
Is not at present disposed to endanger
the success of its Unemployment cam
paign and purchasing power revival by
creating condition that would ad-
va -
ton TO incomes. 1t seems to be con-
fdent that the recovery plan is working
satisfactorily. 1t estimates that 2,000,-
900 persons have been directly bene-
fitted by it and that their wages add
$50, ,000, 900 a week to the publics abil-
ity TO spend. Early in September the
total of the unemployed should be be-
low 10000 900, compared with 13,000,-
900 last Winter.
Speculat0r Is Impatient.
The Spring season passed with few
bank failures. The Summer is ending
with a conspicuously low record for
commercial inSolvencies. The infation-
lists who predicted in April that We
must have devalued dollar within so
days or chaos would result are dis
credited. It is the spectators who are
impatient. They dream of a return
Of the markets Of June and July. They
are always willing to sacrifice any per-
manent gain fof a temporary advantage.
They wanted and encouraged defation
for three years. Now they seek profits
from imitation. After q man long i'll
has been rid of his fever, the best
treatment Is for him to go out and
sit in the sun and let Nature be the
restorer, rather than to try to Pc
himself up with stimulants.
A notable proof of this In cure
Business Life may be had in the re
covery Of the railroads during recen
months. Their outlook early this yea
was the most serious in their history
their securities generally at bankrupt
prices. Few roads in 1882 had mar
gin over their fixed charges. They have
been helped by the Reconstruction FL
nance Corporation and they have been
aided by their own efforts This latter
fact Is revealed in the gain of over
400 per cent in operating income In
July compared with that month last
year. Gross revenues, however, rose
only 70 per cent. The difference rep
resents the buckling down to the sit
uation by all railroad employees and the
use Of American ingenuity and eficien-
cy to make each dollar received 60
the longest way.
Roads Showing Surplus.
Not so long ago there was talk of
q receivership for the New York Gen.
trail. This has evaporated since the
road began to show monthly surplus
instead of q deficit. To July 81 it had
an increase of about s10,00o,000 in in
come over the previous year The Bal
timore & Ohio was another carrier IN
a precarious position prior to its financ-
ing last December Now it promises to
show a surplus over charges for 1888
Its July net was two and half times
seven months shows net of S4.285 o0G
while IN the same term of 1882 there
was deficit Of about this amount.
The Pennsylvania paid. dividend
last year from earnings substantially
smaller than those to date The South
ern Railway has had remarkable
comeback. Its net income this year
is 50, GAG. 900 and was only S242, 900 TO-
the FIRST seven months Of 1882. Al
lantic Coast Line and Louisville &
Nashville have IS and times, respec-
lively, the sums available for interest
that they showed last Summer.
1t Is significant that the systems in
the East and Southeast have enjoyed
in the Southwest and in the transmits
sisStppi area The Southern Pacific
Burlington, Atchison. Northern Pacific.
Rock Island and Missouri Pacific have
yet to show a positive improvement in
their returns. The Great Northern
and Chicago & Northwestern have hae
the benefit Of the industrial recover,
in the expanding ore traffic over their
lines.
u. S. Issues at Premiums.
The status of high-grade corpora
ton mortgages does not change with
the f1uctuating emotions of those who
favor or reject the philosophy Of infia-
ton. The Treasury has no difficulty
in finding buyers for its short-dated
paper at a fraction Of per cent. It's
long-term loans go steadily toward
higher premium. This remains one cf
the most convincing proofs that infla-
ton Is not to be an early resort of tn
administration to prop up prices TIL
are slowly rising Of their own accord.
tCopyright. 1e33)
ARRIVALS INCREASE