Evening star., 1951-12-16
Britain Will Sell Gold
10 Pay U. 5. Dec. 81
And Bolster Standing
BY the Associated Press


LONDON, Dec. 15.-Hard-up
Britain announced today she will
pay both interest and capital in
stallments, totalling sits million,
due December 81 on her postwar
loans from the United States and
Canada. She might have claimed
waiver on the interest.
Prime Minister Churchill's new
government also gave the British
pound sterling a small measure of
freedom to demonstrate its real
value in foreign money markets.
Subject to some continuing limi-
tations, the Bank of England
authorized private individuals to
trade British pounds for foreign
money for the first time in ~
years.
Both moves clearly were in
tended to restore world confidence
in Britain's wobbly economy and
weakened currency and to bolster
the British case for more military
and economic help from the
United States.
will Sell Gold to Pay.
A highly placed informant said
the government will have to sell
gold from the British-banked
sterling areas waning gold and
dollar reserves to pay the United
States and Canada.
However, Britain has asked for
$500 million in economic help
alone from hte United States Mu-
tual Security Agency for the next
six months and the United States
expects to be able to hand over
perhaps half that.
The debt installmentS are the
first of so which Britain is due
to pay yearly until the year 1000.
The United States will get S51.5
million dollars on principal and
$87 million in interest, Canada
will get $14 million on principal
and $23.7 million in interest.
Churchill Sails December 20.
The United States put out $4,-
S50.000.000 and Canada $1,185,-
100000 for Britain in 1916 when |
this country was reeling under
economic shocks from World |
War II.
Mr.. Churchill pumped for the
repayment December 81 in spite
of continuing British economic
crisis.
The 77-year-old prime minister
sails for New York December 90 to |.
call on President Truman in
Washington. He wants both eco
nomic and military help under the
Mutual Security Program.
Some United States congress
men may oppose additional help. /
Changes Symbolic"
The move to relax currency ex-
change regulations followed ru-
mors that the pound would be re-
valued or set free to find its own
level. The government did neither
of these things. The sum total
of the change is that permitted
currency transactions will take
place through the private money
market rather than through the
bank. nationalized institution.
Some risks in supporting the
pound are switched from the bank
to private traders.
A Bank Of England spokesman
stressed the changes are more
symbolic than fundamental"
In New York's Wall Street.
there was mild approval. Some
American financial sources speeu-
lated the move might be a first
step toward freeing sterling cuil-
pletely from Government control,
but others felt it could be called
only gesture at this time. They
had greater cheers for Canada's
bold move Friday in sweeping
away all artificial controls over
the Canadian dollar.
The present official exchange
rate Of $3.50 to the pound is un-
changed. But British and foreign
dealers can dicker among them
selves and arrive at their own
agreements within fixed limits on,
for example. how many dollars it
should take to buy pound.