The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1934-11-22
TRADE ACCORD
URGED BEFORE
STABLE MONEY
Restrictions on international
Flow of Goods Must
Be Eliminated.
BY JULES BACKMAN AND
A. l.. JACKSON


fVice-presidents. Economic Statistics Incl
NEW YORK, Nov. 22.-One of the
most hopeful signs that has been in
evidence recently is the order Of the
treasury eliminating all foreign ex-
change restrictions. These reStrlc-
lions were first imposed after the
banking holiday in March, 1888, to
prevent a flight of capital, which
was taking place because Of infla-
ton fears generated after abandon
ment of the gold standard, passage
of the Thomas amendment and
similar actions.
Although these restrictions were
steadily frightened in the first few
months after they were imposed, ii
is generally acknowledged that a
flight of capital was not entirely
prevented. Since the revaluation OF
gold last January, these restrictions
have been steadily eased. AS a mat
ter of fact it is fairly we'll known
that in recent months practically
all requests made to the treasury
for foreign exchange have been
granted.
Must Still Report
Thus, the elimination of these re-
strictions was primarily a formal
recognition of a condition that was
already existing. 1t should be
pointed out, however, that although
the restrictions have been lessened
it will still be necessary to report
all requests for foreign exchange in
excess of $1,000 a week by any one
person or organization.
The primary significance of this
step is probably found as another
sign of conservatism on the part Of
the administration, and, as such, ii
is another indication that further
devaluation of the dollar is not
likely in the immediate future. Or
the contrary the elimination OF
these restrictions must be considered
as a definite and constructive ster
toward final Sterilization of the
currency.
May Be ReimpOsed
We realize fully that these re-
strictions can be reimpOSed at 6
moments notice. But we are as
Stunning that the necessity for that
will not arise.
1t will be a long step toward re-
covery in international trade, if de
facto temporary sterilization in
the international exchange market
is accomplished. 1t is obvious that
de jure QegaD sterilization is not
feasible at the present time.
A large number Of restrictions on
trade, such as tariff carriers, i'm
port quotas, exchange restrictions
and so forth, must be eliminated
and the troublesome question of war
debts must be solved, if a free flow
of gold is to take place.
Trade Must Flow Again
Because of the close relationship
between movements of goods and
exchange Sterilization, these dlt-
f1culties must be overcome before
final sterilization on a permanent
basis can be affected. In addition
trial period must be undergone
in which time the external values
of the currency can be adjusted to
each other in light Of the relation
ships existing between the various
internal economies.
If this were not done first, the
currencies might be stabilized on a
basis which would result in malad-
justments in the future balances of
payment of the foreign countries
This, in turn, would upset any
sterilization that might be agreed
upon.
However, the step that has been
taken indicates that we are moving
in the right direction. If future
actions conform to recent indica-
tons, more hope can be had for an
international sterilization of cur
rencies and the attending recovery
of world trade.