The Wilmington morning star., 1945-06-18
BY SIGRID ARNr

peso, American and Canadian ' va
lars, British pound. Then thev o W..
begin to buy the things they ne t+I
American machines. Canadisn
wheat, British overcoats, Meyicsn
silver, and so on.
Suppose they keep the franc =.
two cents, and buy a $4,000 Aner'
lean truck. 1t would cost l5OOM
francs. Suppose they droo tSs
franc to one cent. The truck wouIi
cost 100000 francs. Obvious1y
when France is buying, it womb
be to her advantage TO keep tbs
value of the franc high.
But look at t problem when ,hs
sells. Suppose the franc is at two
cents, and she begins to produce
leather gloves at $50 francs. That
would mean she would sell them
here at 81 pair. But if she drops
the franc to one cent she would
be able to sell the same pair Of
gloves here at $3.50.
She might sell more gloves and
she might Re able to sell more ma.
tons, those which couldn't afford
the higher price.
France wouldn't particularly lk,
to cut the value of the franc, But
she doesn't know what othe. a.
tons will do to their currencies.
Suppose Italy should stabiliz' the
Ira at sue a low rate, compared
to the franc, that it would be
cheaper for women in Rio De
| Janeiro to buy Italian gloves than
to buy French ones.
All of Europe is in the same boat
None of the nations know Whether
any of the others, driven by the
tremendous needs for foreign cur
| rercies, may have 10 undercu
each other.
Part of their problem, they say
would be solved if the Breton
Woods proposals for an information
al foreign exchange fund were ratl'
fed by the United Nations. But it
| may take months to year or more
for the Breton Woods plans to start
operation.
/ So the French plan to suggest
ali almost immediate meeting. Per-
haps limited to Europeans, if other
ratiors are not interested, to ty
tc set at least the interim currency
rates in relation to each other
They point out quite frankly they
nay want to keep the franc hlgn
| right now while they are in the
first rush of buying trucks, type
writer's, locomotives, raw male
rails, food, clothes, medicines
Then later, when they and the
rest of Europe begin to sell, tney
may want to set the franc lower
In Prague the Czechs are having
similar troubles. Before the war
% Czech crowns equalled one AM
erican dollar. The Germans NOV
ed in, and set the value so low lAa'
now it takes 100 Czech crowns u
buy an American dollar.
The Czechs are asking that 'le
U. S. Army, which is now occupy
ing parts of their country, asEss
to setting their crown at ~ 10 'L'
dollar. The Russians already nave
made such a concession. The Cle. ,
, crown was worth Is to one RuSSl '.
ruble when the Russian aflllt e.
moved in. Moscow has agfeeu "
drop it, so that five crowns n0"
buy a ruble. r,o
The difficulty is increasing C IT,
choslovakia's initiation, ana , ls.
fear the growth of remoraAl"'
black market. .,oor
It works this way: Say an n.il ANN,
lean soldier stationed IN fLSs u
earns $50 American a moh,l' + ~
is paid in Czech crowns i oe, OF,
crown is worth 10O-to-one' ne On st IN
E 600 crowns. If it is worth 0o., VII,
one he gets only 1900 crowns nv n,
naturally is not as 1ree ~ W. ~
high prices in black maIh', Jsr.
The Norwegians, also IN inc t 4a
about the actual value OF ., 1N sv
money, have announced { u ~ HI
chance their crown at 1896 10: 'l'
American dollar. Before the WA a5e !,
stood at Az. They admit lux. .a5!
must wait to see how their .h 1@f,
develops before they know %nS' q
err they can support the ci0""
that calue. rooney
These shifting values OF l tOats
with their effects on WoIla u. III,
was one of the prime reasons VA ~
Breton Woods conference
called. nronosa!
But the Breton WoooS ptoF tbret
give the war-wrecked nations E.T v" t
Years of grace before they na,i
announce a permanent Yal0 sro,jt
In the meantime the FIelicn a MS
that the reopening trade lanes n r-se
be aided by some interim 90
melt.