The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1935-01-17

Rotary Club Speech
By City Jeweler
Raises Issue.
by VINCENT s. LYONS
Times Financial Editor

CHARLES B. DYER, Indian
~ apolis jeweler, speaking before
the Rotary Club on Tuesday de-
clared that any one who has old
gold for. sale will be wise to con-
vert it into money without delay.
Substantiating this contention, Mr..
Dyer asserted that there is little
likelihood that gold will increase
in value regardless Of the Gov
ernment's future attitude toward
the gold standard.
Like every one else, Mr.. Dyer is
entitled 10 his opinion. But the
sagacity of subscribing whole
heartedly to his contention is de-
batable. II should be remembered
that on Jan. 13. 1894. the Secretary
Of the Treasury made the following
terse announcement: Until further
notice the Treasury will buy gold
at s35 an ounce" This statement
followed in the wake of the de-
valuation Of the American dollar.
Furthermore, it will be recalled
that under the Thomas amend
ment the President has power to
devalue the dollar, or increase the
price of gold, by so per cent. A 40
per cent cut in the dollar already
has been made and no additional
power would be needed by the
President to go the remainder OF
the distance.
THE Roosevelt Administration is
L unequivocally committed to
policy of dollar devaluation. One
- its chief problems in the cur
rent session Of Congress is to en-
deavor to forestall the introduction
of any wild schemes which would
tend to further reduce the value
of the dollar in the world markets.
Senator Elmer Thomas, sponsor OF
the original amendment under
which the dollar was devalued, and
leader Of the inflatiOnary bloc, has
repeatedly called for an additional
cut in the nations monetary unit.
1t seems highly doubtful that the
Government at the present time
would give any consideration to a
plan to restore the dollar to its
former worth and, consequently, to
lower the price of gold. When the
worth Of gold was raised to S35 an
ounce the Treasury was enabled
to realize a handsome profit on its
holdings sufficient to establish a
sterilization fund for the protec-
ton of the dollar in the foreign
exchange markets Of the world.
If the gold buying price of the
Administration was altered down.
ward, the Government would lose
I'll of the profit gained by the
earlier move and further cOmpli-
cate the budgetary position of the
Treasury. This is very important
point in considering the ultimate
value and one that should not be
lost sight of for the obvious rea-
sons cited.
THERE is only one thing on the
Il economic horizon at present
which would give weight to Mr..
Overs contention and that is of a
somewhat dubious quality. This
factor is the case now pending BE-
fore the United States Supreme
Court on the validity of the gold
clause in obligations. It is possible,
but not very probable, that if the
Governments action in abrogating
the clause is ruled invalid the
United States might not be able to
maintain its S35 an ounce price for
gold.
Consequently, in view of this
eventuality, there is a possibility
that the Government would reduce
the price of gold. However, such
an action would have repercusSionS
throughout the world and there
fore an alternative method I'M
doubtedly would be utilized. This
is readily available through the
simple procedure of levying a 100
pei. cent tax on profits resulting
from the increase in the buying
price Of gold.
In view of all this evidence it
would seem that the worth of gold,
in so far as the United States is
concerned at least, is not headed
for any immediate reduction. The
valuation of the precious metal is
definitely fixed at S35 an ounce
with further rise easily possible.
=
WITH Mr.. Dyer's statement
w that when you sell gold
take it to a reputable jeweler' we
heartily agree. When the Govern
ment lifted its buying price of gold
to S35 an ounce it enticed persons
to sell articles containing this
metal. "Chiselers" came upon the
scene and reaped handsome profits
for themselves.
The measurements in computing
the value of old gold are rather
complicated, especially to the aver
age person whose knowledge OF
economic functioningS is distinctly
limited at the best. As a result a
little sales talk by the buyer inter-
woven with such complex terms as
grains" grams" and fine ounces
and the seller would complete the