The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1933-06-01
New Gold Exchange?

All rights Of republication OF all other
matter herein are also reserved.
New Gold Exchange?
If recent politico- economic history
in this country repeats itself, we shall
soon have New York an open
market for gold.
Under the monetary system which
depended upon gold for standard,
it was the one commodity with fix
ed price, that being the $20.67 per
fine ounce established by congress.
AS a practical matter it could sell
for no more in this country and it
certainly would sell for no less.
But even with the nation off the
gold standard the yellow metal still
plays a rather important part In the
fiscal scheme. France and some other
nations still are on a gold basis. The
tradition of its value clings to it.
And so the committee for the ma
ton, an aggregation of businessmen.
has suggested to the administration
that it set up a gold exchange in New
York to share with England regula-
ton of the world price of this COM
modify. BY demonetizing it they
would permit 1t to seek it's natural
level in relation to other commodities.
The inference suggested by the
committee is that the price of gold
would Immediately rise, thereby add
ing an additional factor to the in
flationary program. It points to the
fact that gold was selling in London
at $24.67 an ounce when it still was
on the fixed basis in this country.
Commenting on the proposed gold
exchange, James H. Rand, Jr., chair
man Of the committee, says:
CAS- the largest holder of gold in
the world. the United States, In self
protection, should establish its own
gold market.
Aside from the fact that this coun-
try has no share in the establishment
of gold price at the present time
the absence of an open market Is
causing gold to flow to other coun-
tries to the disadvantage of the Unit
ed States.
Gan advance in the market price
in New York beyond the London price
would enable Canada and other gold
producing countries to export output
of mines to New York rather than
to other financial centers. This
would tend to raise the world price
of gold bullion, and give the world
what all people desire-higher COM
modify prices.
"A curious commentary upon the
present condition may be found in the
fact that the United States Treasury
is selling gold for commercial pur-
poses at $20.67 an ounce. This per-
mits gold so released to be manu-
featured into jewelry which can then
be exported to London and recon-
verified into gold at prifit.
IF the administration were tc
promote an open market it would not
necessarily follow that there would
be an excessive and unhealthy rise in
the price of gold. The government
could minimize such a possibility by
announcing the price at which il
would be prepared to sell gold in the
open market. The committee believes
the treasury should sell no gold below
$500 an ounce, price common
surate with the commodity price leye
of 1926
TO most Of US, gold is just tho
name Of thing which We know exists
but with which we are personally un.
familiar. 1t is difficult thing To-
us to trace all Of Its ramifications ane
implications. Few are prepared t.
discuss the merits Of the committee1
suggestion.
The interesting thing, however, i
the apparent relationship betwee,
this committee and the actions o
the administration. All Of the majo
economic steps taken by Presiden
Roosevelt and his advisers recentl
have been preceded by published sug
gestions Of this committee.
On this basis. q prediction that W
are to have gold exchange would b
more than mere idle chatter.