The Nome daily nugget., 1936-11-07
DEMOCRACIES IN LINE
(New York TimeS


 To a world troubled by conflict of will and confu- sion of purpose in many quarters that the three great democracies of France Britain and the United States have agreed joint plan to stabilize their rencieS has brought In hardpressed Fran this is hailed by the government Sgnalzing 'the start of monetary peace" London dispatches des crlbe 1t as "a turning point of many years In Wash lngton our own government finds in it hopeful pro- mise of greater stability in international relations It is already evident that many other nations-nations in the sterling bloc, in the god boc and in the dol lar area'-W follow the leadership now given them by the three great financial Powers whose currencies dominate the international money markets
 So deep is the satisfaction expressed the ag- reenen which has been reached, and so bright are the hopes vouchsafed for revival of confidence and at least gradual improvement of international trade, that will certainly be asked why the world had to wait until the Autumn of 1886 for the achieve ment of financial entente whose beneficial consequent ceS now seem to be evident. Why could not this decision have been reached an earlier stage of the recovery movement, better s in the dark days of depression?
 The answer to this question must be found in the sequence of events since 1880 and in the which these events exered upon the policies of governments
 In September of 1931 following financial panic in Central Europe and the flight of capital from Germany, Great Britain left the gold standard. The immediate reason for that step was drain the gold reserves of the Bank of England But behind this lay increas- ing pressure to resort to monetary action in order check the forces of dehaton As the Financial Com- mittee of the League of Nations has pointed out the fall of prices in all countries during the depression pro- foundly disturbed the relations between the cost of production and the prices of goods produced between the burden of domestic debts and the reduced income which the fall of prices occaSoned In the frequently expressed opinion of the British Government departure from the gold standard helped first to halt further fall in prices and then to induce moderate rise, which stored the equilibrium between costs and prices and between debt burden and income, thereby paving the way for a recovery of business.
 Meantime this depreciation of the currencies of the sterling countries exered defatonary pres upon American prices and helped undermine val which the American banking structure rested Throughout 1882 efforts were made by the United Stat and other nations to persuade the British to stabilize the pound The question played dominant part in the discussion of a resettlemen of the debts But the British government, not yet convinced that it had ach eved domestic price level satisfactory to it's intern al economy rejected this appeal for stablization
 There followed, early in 1883 the development of the American bank panic; the change of in Washington the suspension of the gold standard by the United States the meeting in London of the World Eco- homie Conference, for which arrangements had been made many months before. By this time Britain, hav- ing achieved large degree of stability in domestic prices, ready to stabilize the pound France un- der great pressure from sterling depreciation was for stablzaton. But the United States now block ed the way Pursuing monetary policy similar in purpose to that previously pursued by Britain the Am ercan government was unwilling to stabilize the doll