Evening star., 1951-02-11

to hoard.
The Treasury may care, thol
with foreign governments and
central banks. Gold is used as the
measure Of the relative values of
the worlds different currencies.
The Treasury pays $35 an ounce
for all gold offered to it: and
charges foreign governments and
the jewelry trade $35 an ounce
when It sells gold.
Many people about the world
do not think the dollar still worth
one-thirty-flfth of an ounce Of
gold. In places abroad where the
laws are not so rigid, or not so
rigidly enforced as here, individ-
uals trade in gold at prices well
above the legal limit. This trade
goes on with the use of local
currencies. Frenchmen, for in
stances. buy and sell gold quite
freely in Paris every day, using
francs as money.
American dollars are also used
in some Of this gold trade abroad.
And not all this trade is between
private parties exclusively. Gov
ernments and central banks par
ttcipate In 1t. sometimes through
the subterfuge Of selling indus
trial. gold to Industry: and
sometimes just plain gold coins to
any buyer at hand. This govern
mental activity keeps the worlds
black markets supplied with the
yellow metal. And since black
markets involve both gold and
currencies, the rules to which the
members of the International
Monetary Fund are solemnly
committed are daily being Knocked.
Type of Gold Digging
What riles. or should rile. the
United States Treasury is that
governments which are free to
turn in dollars here and get gold
for them at $35 an ounce are
busy selling gold for dollars and
other currencies at premium
prices. This means that they are
using Uncle Sans gold policy as
q good thing. Recently, It is
reliably reported. the Bank of
France was reproved for engaging
In this type Of gold digging. It
Is not a new practice with the
Bank of France. It seems to be
just a case where London got
irked about it. Why Washington
should wait for London to prod it,
If 1t did wait. is not quite clear.
Other countries have been SELL
ing gold at high prices while
simultaneously buying the metal
from the United States at the
fixed price of $35. Mexico, for
instance. South Africa's battle
with Secretary of the Treasury
Snyder in the International None
tary Fund has long been a matter
OF record. South Africa seems to
have won out. 1t has been busy
since 1949 selling all the gold
the traffic will bear at premium
prices.
Now Canada is under pressure
from it's gold miners to go and
do likewise. And Canada has
always been held forth as model
Of good international behavior.
even though, along with many
other countries, it has found a
way to subsidize its gold miners
and still be member of the fund
in good standing. For the miners,
a subsidy Is the same as higher
price.
AS the residual buyer of the
worlds gold for these many years.
the United States is the keystone
which holds the structure Of the
international gold bullion standard
together. If we stepped out, the
arch would tumble. Since the
dollar we use at home Is COM
pletely of the paper variety and
now daily losing some Of its value
in trade, the American gold stand
ard has degenerated into a form
OF global charity from which the
U. S. S. R., along with the rest of
the world, is free to benefit. Tenn
porarily, thanks to Korea, we are
in such hurry to buy materials
abroad the while we are also de-
veloping and reconstructing the
world with gifts and loans, that
we have had to send gold away
to balance the books.
Only a few days ago. for in
stance. one Of the big London
banks in an advertisement in the