Evening star., 1933-11-02
Administration Again Boosts
Price of Domestic Output
to $32.36.
LONDON QUOTATION RISES
FROM $31.52 TO S32.11
Dollar Remains Weak, Declining
Overnight to $4.82 to
the Pound.
PARIS, November 2 %.-The
Federal Reserve Bank began buying

Federal Reserve Bank began buying
gold in Paris today with the pur-
chase of small amount from the
Bank of France.
A similar transaction was under
stood to have been made in London.
A recent heavy flight of capital from
America was reported by exchange ex-
perts. One individual today was said
to have purchased million dollars OF
gold.
The identity of the Federal Reserves
agent here was not disclosed, but bank
ers said they believed the institution was
dealing directly with the banks OF
France and England.
Exchange traders described the Re
serve Banks purchases as too small to
make deep impression on the market
and said he believed the Reconstruc-
tion Finance Corporation intended to
hold gold purchases to the minimum.
BY the Associated Press.
The Roosevelt administration today
dangled before the world an offer to
buy all the foreign gold that is ship
ped to this country, and again advanced
Ille ~ WIllCll lllc ~ LhdhCS
purchases of the new output OF domestic
gold mines
For the latter a price of $32.36 an
ounce was established, as compared
with S3226 yesterday.
Meanwhile. the bullion quotation at
London, presumably in response to the
Roosevelt plans, rose from S31.52 yes
terday to S32.11 today.
Dollar Declines Overnight.
The dollar was weak, declining over
night to s482 to the pound. 1t also
weakened against the franc.
Details of plans for purchasing the
imported gold, including the price to
be paid, remained undisclosed. as did
the status of negotiations with Great
Britain.
These were undertaken for the pur-
pose of avoiding currency depreciation
race between the two countries as a
result of the American operations.
The theory behind Mr.. Roosevelt's
program is that If gold prices can be
raised and held at high level both
here and abroad there will be an auto
matte adjustment which will carry do
mestic commodity prices upward as
we'll. Higher prices is the first objective
of the Presidents recovery program.
Making known the first step in the
buying of foreign gold, Chairman Jesse
H. Jones of the R. F. c. last night an
nounced that the New York Federal
Reserve Bank would pay for imported
gold in r. F. c. notes, with which the
newly mined domestic metal also is
bought.
Jones made his announcement in his
10
National Broadcasting Co. Nationwide
network. The full text of the speech
appears on page B-8D
Direct Dealings Avoided.
BY this plan it appeared the Govern
ment has avoided direct dealings in
foreign gold and exchange markets,
leaving them to individuals and firms
choosing to ship gold here.
The effect of this upon world gold
prices and the exchange value of the
dollar and the pound, economists said,
would be virtually the same as though
the Government were making the pur-
chases direct.
American firms importing the gold,
it was explained, would have to buy
pounds or francs to pay for it abroad,
thereby depreciating the dollar in rela-
ton to the British and French none
tary units.
Europeans who choose to send the
gold here will be paid in the R. F. C.
notes, readily convertible into dollars,
and then would have to convert the
dollars into the currency of their own
country
The result would be an offering of
dollars for pounds or francs, just as
in the case of an American making
the transaction
It suggested unodcia1ly that the
imported gold price might be the same
as the daily quotation for newly mined
metal
If this eventuates, and the admin
istration continues to hold the domestic
figure above world quotations, it was
asserted, the world price would rise to
level very close to the American
figure, or else there would be huge ship
ments of bullion to the United States
After the fixing of today's price. Jones
remained in consultation with Under
secretary AcheSon of the Treasury De-
partment for half an hour.
He declined to make any comment,
but promised an announcement later.