Evening star., 1935-03-17
Prospect UnsettIes Prices.
F.; Slight U. S. Effect Likely
After Decision.
ACTION WOULD SPEED
WORLD STERILIZATION
CLOSE Scrutiny of Belgian Unit
; Brings Selling-Conference To.
morrow Awaited.
BY THOMAS E. FLANAGAN,

Associated Press FINANCIAL writer.
, NEW YORK, March l6.-Wall Street
foreign exchange circles are leaning
very strongly to the belief that the
gold bloc is getting ready to devalue.
How much they may devalue, and
when, is said to be anybody'S guess.
Until definite action is taken, most
observers think the prospect will be
an unsettling factor, but once devalua-
ton is out Of the way. number think
the last serious obstacle to stabiliza-
Lion of world currencies will be found
20 have been removed
So far as the effect upon the United
States is concerned. most foreign eX-
change experts say 1t will be slight. 1t
Is the sterling bloc of currencies whose
fluctuations seem to affect American
price levels. While the lower dollar
should in theory have helped American
exports 20 gold bloc countries, the fact
has been that the gold bloc has mostly
been surrounded by high tariff walls
and import quotas.
Leaders to Confer.
The Belgian currency is being
watched for signs of cracking, and the
lhere fact that it was under scrutiny
'saS enough to bring considerable SELL
ing of that currency in New York and
London. The fact that Belgian and
French authorities are going INTO a
huddle over the monetary situation on
Monday has been enough to arouse
fresh doubts over the Belgian situa-
Jon. Belgian industry has been
severely depressed by the def1ationary
effects of the declining pound and
collar. The recent trade pact with
the United States may help, but is
thought to have come too late to make
The position of the belga secure.
Wall Street international financial
TLarterS say a number of gold bloc
financial authorities express the opin-
IN that devaluation of their cur
i..ncies is almost inevitable, but that 1t
lEas been politically dangerous even to
:sggest it publicly, because of the
h.sses suffered by the thrifty French
aMd Belgian people as a. result of the
pS,st-war devaluation, and the pride
~ the Swiss and Dutch over the
fSility to maintain their pre-war
PARTIES.
Furthermore, all of these peoples
were close to the terrific German in
tAtion which wiped out the savings of
tSe middle class ano caused frightful
saffering.
Nothing like the postwar infations
II threatened now. Some think 20
per cent devaluation would do the
trick.
But public sentiment is such that
the ground must be thoroughly pre-
pared before t would be possible for
any French government, for instance,
tn devalue and stand
British Pound Is Strong.
Selling of the belga prompted BY
tIe fear that Belgium may devalue
lrer currency featured foreign ex-
change markets today. Weakness in
this and other gold bloc currencies
contrasted with strength in sterling.
The gold currencies were at the
level where gold shipments to the
United States would have to be made
in order to protect rates against fur
ther declines
In New York the belga weakened
.16 of a cent to 2316 cents.
In London the dollar was a little
soft, and in later transactions in New
York the pound was l cent higher at
S4805s.
In Paris the dollar strengthened at
an equivalent of 6.526 cents to tl:>
franc, and in New York francs showed
the same degree of easiness at $50
cents, off .003s of a cent.
At the closing rate for francs the
dollar was at a premium OF 66-100 of
/ per cent, compared with premium
of 60-100 of 1 per cent Friday and
premium of 53-100 of l per cent
month ago.