The Daily Alaska empire., 1933-11-06

ICY DdS UtSl lLlduS ui oeSe 4A N reasonably calm atmosphere. The financial markets here and abroad are obviously bewildered. But they are not panicky While few of the recognized authorities profess to understand the policy, while most of those who think they un- derstand it disbelieve in it, the disposition is clearly to accept the decision and to judge the experi- ment by the results as they are made manifest. fb Several circumstances have con- tributed to this sober and matter of-fact mood. The first is the moderation of the first move; the raising of the buying price of an ounce of newly mined American gold by only 27 cents over the world price. This has been taken and presumably with good reason, as evidence that in executing the policy the Administration itself intends to feel it's way rather than to plump for a doctrinaire solu- ton. For the Governments own action in dealing with the price of gold is far less violent than has been the action of international speculators during the past four months.
 A second steadying element is the realization that in taking the control of the gold value of the dollar out of the hands of the speculators and into his own hands, the government is in a position to introduce order and purpose where there has been chance and disorder. For the government has the power not only to raise the price of gold by buying it but it has the power to lower the prlce by selling gold. The power It not merely formal. It is actual power derived from the fact that the United States possesses two-fifths of the monetary gold of the world. Therefore, whatever men may thlnk of the experiment, they know that with the exception of France, there is no other country that has such enormous resources with which to conduct it.
 A third element, which on sec ond thought tends to counteract the effects of fear and beWllder- ment is the realization that the premise of such a policy as this must be an intention to return to a currency convertible into gold. This is not an adventure into Hat money. though failure through maladministration and panic might it must be admitted, lend to Hat money. The policy, whatever else may be unclear about it, is a pol icy described to re-establish a gold currency. The currency is to De revalued gradually, but the end aimed at is stabilized and con vertible currency.
 
 To dwell upon these matters IS not just whistling to keep up one $ courage on dark night. The pol icy is obviously experimental. It lacks the support of the main body of expert opinion, and any one Is gold who feels certain he can pre- dist the result. My own view IS that the result is really unpredlc- table. because we have no eXper- fence which is really comparable. Having embarked on an adventure into unknown territory, the most necessary think to do is to remem- her those teachings Of eXperlence which apply to an adventure into tho unknown. One is to proceed slowly, exploring the ground as YOU go Another is to be well equipped with resources so that VOL can act deliberately Another is to have a sense of direction as to where you wish to go Above all in the unknown, the greatest need is a stout heart, the great est danger is fear.
 Tn this particular experiment the greatest danger lies in exaggerat- ed hopes and exaggerated fears If the experiment succeeds it will certainly not succeed suddenly. As suming it to be true that the price level responds to the gold content of the currency, this response IS not likely to be automatic ana immediate. The price structure Is very complicated thing, and It will require time for it to adjust itself upward to a cheap dollar much as it required time for it to adjust itself downward to a dear dollar The inflationary move ment lasted from the summer of 1929 to the summer of 1882. The reflationary movement is not like 1v to be completed in three weeks or three months. So those who be- ieve in the experiment must put away the impatience of optimism.
 AS for the pessimists, 1t is for them to realize that panic fear is the one sure way to bring about what they most fear. For ob- viously the danger point of the