The Waterbury Democrat., 1936-10-13
COLD STANDARD
 ]. OF 3 20 WERS !! R
United States Has Agreed ] to Join Britain, France for Stabilization
Rx MACK JOHNSON

by Uk1NN SVkA4N0ON f
 United Press Staff Correspondent
 Washington, Oct. l3.-(UP)-The United States went on new gold standard" today under an agree ment with Great Britain and France designed to further stabilize world currencies. ~ .s
 Secretary of the Treasury Henry Morgenthau, IT,, in announcing the agreement, said 1t was intended to stimulate foreign trade and stabil- ize international exchange by rout- ing money spectators.
 The agreement will permit an ex- change of gold for the paper cur rencies of the individual. countries. The three. ntaions will cooperate in establishment of exchange price of gold from day to day, orgenthau said. Gov'ts. to Cooperate
 'This agreement" he announced, represents @ divorcement of control of exchange markets from the few individual international spectators. Responsible governments of the peo- pie will now cooperate to assure a, minimum of, exchange huctuation."
 In agreeing to the proposal. the "big three" monetary powers reserv- ed the right to cancel it on 24 huors notice if any of them find 1t ad- yersely affects internal economy.
 If, for example, we find the agreement and its operations are retarding recovery. We'll scrap it." he said. England and France have the same privilege"
 Price of Gold
 Morgenthau set the price of gold for today at $35 per fine ounce, plus one quarter of one per cent for handling charges. He will consult the other participants before an- nouncing the price each day.
 Trade will be promoted and money speculators routed, Morgen- thau said, through the placing of the three powers combined $4,350.- 100000 stabilization of equalization funds behind a pledge to exchange gold for their. own currencies.
 Under the new plan,, none of this gold may be shipped to any coun- try except England and France. Other countries, however. may come into the agreement and thus be per- naitted to participate in the ex- change of gold. s s
 Door Is Wide Open
 '"The door is wide open, Morgen- thau said. Were not. going out drumming up business. but we'll welcome all other countries which want to participate." =
 Asked what effect, if any, the new development woul dhaye on the dol- lar in the pockets of the man-on- the-street, Morgenthau said.
 None at all. This move affects only the external dollar-the dollar used in international trade. But, if we find it does we'll discard the agreement"
 The American selling price of gold, Morgenthau said, could be made flexible without further devaluation of the ,dolalr, an act which would affect the value of the internal dol- lar. ess
 Buy or Sell Gold
 It was explained that under the 1884 gold reserve act, the treasury has power to buy or sell gold or silver at prices which 1t may ike without an executive order or con- gressional action.
 Administration officials said they hoped the agreement will stimulate foreign trade. bring relaxation of tariff and quota restrictions and in- crease world peace efforts.
 The. agreement-aS was the orig inal Stabilization understanding last month-was worked out after con- sultations among President Roose- welt, the state department and treasury oficials, it was learned Negotiations were kept secret until the announcement was made by Morgenthau.