Evening star., 1935-01-15
Endorsement of DevaIuati0n
Seen in Approval of Philip.
pine Currency Act.
BRAIN TRUSTERS EXPECT
CONSERVATIVE DECISION
Amendment to Constitution Dis.
cussed if Supreme Court Takes
Adverse Action.
BULLETIN.

NEW YORK, January is R.-
In the sharpest turnabout in a
year the dollar today popped up as
suddenly as a released jack-in-the-
box. The gold bloc currencies
dropped to far below the point at
which the yellow metal can be
shipped profitably to New York.
Gold shares on the Stock Exchange
were under pressure that carried
leaders of 81 to 81 a share or
more, and Homestake Mining
dropped more than 80 points.
Grains gave up a cent or so a
bushel at Chicago.
The furry was attributed to un-
certainty over the pending Supreme
Court decision on the gold clause.
BY the Associated Press.
Treasury experts contended today
that Congress already has, in effect
ratified President Roosevelt's procla-
nation devaluing the gold dollar.
Oficials busy with plans for action
turning on the Supreme Courts ruling
in the gold clause cases held that
congressional approval of last June's
currency act represented
full Endorsement of devaluation.
As emphasized by one expert, that
vote put the Senate and House
"squarely behind devaluation.
The Philippine currency act of last
June 10 appropriated money to pay
the islands the dollar profits accruing
to its gold deposits in this country
through devaluation.
Considered Direct Approval.
Treasury experts consider this law
. direct congressional approval Of de-
valuation and cited especially section
2 Of the Philippine currency act,
which said:
There is hereby authorized to be
appropriated. out of the receipts COW
cred into the Treasury under section
Z Of the gold reserve act of 1884. by
virtue of the reduction of the weight
Of the gold dollar by the proclama-
ton Of the President on January 81,
1884, the amount necessary to estab-
lish the credit provided for in sec
ton Of this act"
Oflcials declined to predict whether
the Supreme Court might take
judicial notice Of this law in de-
termining whether holders of gold
clause contracts under the old dol
lar were entitled now to receive $l.69
for every dollar Of investment.
Opinion of Solicitor General.
Angus MacLean, assistant solicitor
general, during his argument before
the court referred to the Philippine
act. He contended that while the
United States reimbursed the islands,
this action did not commit the Gov
ernment to a recognition of the right
of individuals or corporations to de-
nand gold which was on deposit in
his country.
MacLean said it was an act of
amity, in recognition Of the semi
sovereignty of the Philippines, and
was to aid that country in placing
tself on an Independent footing.
In the meantime, the Treasury said
t placed little credence in published
'eport that departmental experts"
had agreed that a return to the old
yold content of the dollar would have
definite advantages" in. the event OF
IN adverse decision.
It was made clear that If such
agreement had been reached the
Treasury had not been a participant.
With all Washington engaged in
IN intense effort to figure how the
Supreme Court will swing in its
b69, ,000, ,000, 900 gold decision, several
If the group known as the younger
brain trust" joined in the forecast
ng today.
Their prediction. on which they
lid not desire to be quoted by name
1t present, was that the decision
would be conservative" one, up
holding the New Deals action in
,anceling the gold clause in some
s100, ,00O, ,000, 900 Of public and private
securities.
They explained the adjective CON
by saying that If the de-
;ision went the other way, restoring
he gold clause and increasing the
b100, ,000, ,000, 900 Indebtedness by about
I69 ,000, ,000,0 900 in terms Of present
iollars, the administration and Con-
yress would be forced" to take
drastic and fundamental" steps
which might appear to conservatives
% be much more radical than any
hing previously done.
Denial Of "Chaos."
What the steps might be they did
lot say. but they asserted they would
,e necessary to prevent "chaos" in