Milford chronicle., 1939-04-28

some time II II isn't possible to have
too much OF it-sO much, indeed,
that there is a danger of 1t becoming
economically valueless.
The case in point is the u. s.
government. Five years ago we had
little more than 100000 ounces
of monetary gold. Today we have
over double that amount-431,2 200, 900
ounces. And the yellow metal is
still coming into this country from
abroad at an accelerating rather
than a diminishing rate. Hardly a
week goes by without a gold ship
ment.
If this gold were melted down into
a single ingot, II wouldn't be as inn
posing a spectacle as you might i'm
agine. II would make a bar meas
uring GO by 20 by 20 feet. But that
bar would have the incredible value
at our artificially established gold
price of S35 per Ounce-Of over
$1,000, 100000.
More important than the mere
money value of our gold is the fact
that 1t represents pretty close to 60
per cent of all the monetary gold In
the world. Almost equally impOr-
tant. as the U. S. News points out,
is the fact that the remaining forty
odd per cent is extremely badly di-
Vided. England and France have the
bulk of it. A number of small pw-
ers have some. And three of the
great powers, Germany. Italy and
Japan, have practically none--not
more than per cent of the total.
Gold is flowing into this country
for a variety of reasons. One Is that
under our law, the Treasury must
accept every ounce offered and pay
$35 for it in our currency, whether
it can be used or not land today,
our gold reserve is almost infinitely
greater than our requirements, fig
uring on the most conservative ba-
sis). Another, increasingly potent
reason is that European capital is
over the possibility OF
war, and wants to get its money as
far away from the scene of pending
hostilities as possible. The outlook
then, is for our gold imports to con-
tinue to soar. Even today, it is COM
ing in at the rate of $10O0OO.OOO a /
week-and if that rate were to be
in three years we would |
have every ounce of monetary gold
in the world.
And that's what has the ecOno-
mists puzzled. 1t is obviously poss-
ible. especially in the case of war.
that we may find ourselves with
a complete corner on
gold. No other country would have
enough to be worth mentioning. And.
in that event, they would have to
tie their monetary systems to some
other standard of value. Already
that is being done in the fascist
with their infnitesimal
gold reserves. Germany, for example
has virtually announced to the world
that it can and will get along with
out gold. And by the use Of the bar
ter system, blocked marks" etc, 1t
has gotten along so far. Whether 1t
can keep going in the future without
further imperiling its more or less
lottery economic structure is a mat
ter for conjecture.
1t is hardly a matter for conJec-
ture. however, that if all the other
powers, finding themselves without
gold. got together and decided to re-
wise their monies and trade to mt
some other stannard, it could event.
lally be done. And then we would
ind ourselves with about $25,OOO.-
700 900 worth of gold which was use
ul for ornament, and for almost
nothing else. But that, OF course, Is
not an imminent possibility-France
md England, which still are the
great financial powers OF Europe
nave shown no inclination to throw
,old overheard. And the fact that
,old has been the symbol of sound
-alue and security to the human
ace for tens of centuries would /
likewise make its abolishment as
he primary instrument of interna-
ional trade and the mainstay OF
extremely difficult.
Some talk is going the rounds
bout the possibility that this gov
rnment might use its huge gold re- /
erve to bring imitation. 1t certainly
ould be done. But. judging by the
autious, "non-experimentar" atti-
ude of the present Congress, there's
mall danger of any significant IN
alton occurring soon. S
o
The stock market has been going
own in the face Of little change In
usiness. One reason Is the fear OF
yar-the day Italy invaded Albania
hares took a tremendous drop, and
he ticker couldn't keep up with
ales. Another reason is the BELIEF
nat European holders Of American
acurities have been dumping them
quantities too large for the mar
ct to absorb in orderly fashion.
AS for actual business. 1t doesn't
I've cause for any great optimism
ut neither does 1t give cause Tor
,e bleak pessimism now current IN
1me quarters. Retail sales have
cen good. So have automobile sales.
he expected reasonal upturn in in
ustrial buying has set in. though I.
OF to much extent. And the agrl-
lltural outlook is not as bad as IL
,emed a while back. 4.
You'll know more about 1t by the