Evening star., 1937-04-25

gold Gin some countries less, in others
more). The U. S. S. R. has increased
its output Of the metal from 100000
ounces in 1929 to perhaps in excess of
100000 ounces in 1886, and promises
soon to overtake South Africa as
worlds leading gold producer. In the
Rand sweating Kaffirs are feverishly
digging gold miles underground q n
miles from the surface, while in Ken
lucky sweating United States Treasury
employees are carefully reburying the
metal in the bowels Of the earth.
In Washington worried officials are
comforting to evolve some formula for
keeping gold out Of the country. II
by chance the war debtor countries
were to offer us gold to pay of the
debts, we just wouldn't know how to
phrase our refusal. Only few years
ago We were insisting that they
hired the money" and should pay us
in gold, not goods And now the
authorities who regulate the country's
credit base might be embarrassed If
Europe were miraculously to find q
way of wiping of its debts with gold
At least we'd be careful to stow the
gold away in a place where it would
do least harm.
If this is not enough to make Rip
Van Winkle rub his eyes, we may read
to him current newspaper headline
On April IS leading New York daily
reported from Washington: White
House Astir Over Budget Issue-Pros-
pect Of Half Billion Rise in Deficit" !"
The item continues: "The Government
bond has shown itself sensitive of late,
following intimations that additional
borrowings of new money of from
10000 900 to $500 900, 900 would have
to be made before the end of this fiscal
year"
What the newspaper did not point
out is that the policy of sterilizing gold,
inaugurated last December, has al
ready caused an increase in the public
| debt at the annual rate Of one and one
half billions, which is material COM
plication in the path OF a balanced
budget.
What in the world" Rip Van
Wrinkle will doubtless ask, "is 'steriliz-
ing gold? Is gold too prolific? For
thousands of years it was rare metal
of which no person, no nation could
ever get enough"
Have Half Worlds Gold.
Well, yes and no. OF course, Rip.
you haven't been reading the papers,
or you'd know that we now hold about
half the worlds gold; that Europe
has sent us $1,537 100000 of capital
in 1895 and $1,141 ,O0o,0o0 more in
1896; that for three years in success
sion well over $1,000, 100000 in gold
has come here from abroad, or $4,072,-
600 900 in ALL And we paid foreigners
another $6o2,0oo,00o for practically
worthless silver during those three
years.
No, Rip, the war debts are not being
paid. But foreign capital just keeps
rolling in. The incoming gold in
creased our bank reserves to a danger.
Gus level. So we raised reserve re.
quirements. But that was not enough,
Hence we decided to sterili7e all in
coming gold. We buy 1t and hide it.
It has Mr.. Lands Of the s. E. C.
concerned, because foreigners bought
over $500 100000 (gross) of secur-
tiles in our markets in 1885 and 1885.
In the same two years they sold over
$4,000, 100000 worth. Ten billion dol
lars is heavy volume Of trading to
be out Of the control Of the S. e. G.
That's lot of money to be swishing
back and forth across the ocean.
True, tho figures mentioned include
. considerable volume Of foreign bonds
and stocks listed here ana bought up