Show r T i t I 1 STUFF Politics PolitiC AND Finance re Syndicate WASHINGTON B By Paul Faul Nation Mallon The Thereal real reason for Mr 1 Roosevelt's I bold inflation program has bas been kept fairly confidential Public excuses have been offered that he was va afraid congress would run wild on inflation Also Iso that he be hei wanted a at bargaining point with Great Britain The first excuse w was u shallow Nearly Near Nur- ly Iy ev everybody in congress was was was' an in In- but no two could agree on how to do It It Those who have their ears urs to the ground round know there was very little dan danger er of congress agreeIng agreeing agree- agree ing In on any inflation legislation and Mr Nr Roosevelt still has the veto eto power The gain of a bargaining point with Premier MacDonald was only a result not Dot a a. cause Those who have the confidence of Mr Roosevelt know what he had his eye on all the time was was commodity commodity j prices His farm bill was not bringing the j desired results The markets did not have the confidence in it which his intercollegiate brain trust had Wheat went v.-ent up but not bec because se of the farm bill Its Ils advance was clearly traceable trace trace- able to bad crop reports Other markets mar mar- looked at the bill bilI and sagged Mr Roosevelt lt is rot not the kind of man manto to let failure dishearten him He went off or on n another t tack in a stronger way wac His inflationary InflatIonary program would do practically alt all that the farm bill sought ought but would have failed to do Coh Congressional leaders were told confidentially to pass the farm bill biU billas as long g as asit it had gone so far It will willbe willbe willbe be used to handle any surplus crop rop difficulties which arise The truth is that many big business businessmen men foresaw another collapse in July None of the measures in contemplation contern- contern would have been strong enough to st stop p it The closed banks were not being reopened They could not be reopened in m many instances unless commodity prices improved Much of ot the collateral of these closed banks was in warehouse depreciated depreciated depredated de de- de- de predated stocks and real estate mort gages Four billion was tied up in that category Only inflation could reach that thai problem a aThe The boys bos in congress 55 generally are ready rudy to throw up th the sponge and Continued Continue on Page Two INSIDE STUFF F rom Paw Pau Ont One concede Mr Roosevelt Is the waster ter The he game Im he Is playing is 15 so ao far above the crude rude old political game Iame they know that they have become in the woods It mere babes approaches ap apo the heights of practical statesmanship from a tactical standpoint stand point whether or or not you you like his policies Many l congressmen do not like them There Is nothing that the they can do They have hive disarmed on all aU these current issues that they must gurgle a reluctant assent when the they would like to shout In hi opposition n. n 0 The way he works is tot ke radical Ideas and give them conservative han han- dUng He starts with left wing material ma ma- tonal and to the ther r right He made nearly everyone believe inthe Inthe in inthe the inflation bill bill that he was giving them the real Huey Thomas Pat man stuff stull He even selected Senator Thomas of oC Oklahoma to handle the legislation That in itself was a master master mas mas- ter stroke Thomas did not write the bill None of the ideas in it were his original ideas He wanted the free issuance of currency payment of 01 the bonus in greenbacks All he got was a rather sided one-sided compromise compromise and and his name on the bill S The same scheme was worked on the gold and the silver people Father Coughlin's adherents think the R Roosevelt program embodies revaluation re re- valuation of the gold dollar It does docs not in the same sense that Rev Cough Cough- in tin advocated it Mr Roosevelt merely brought gold to his side by includIng Ing ng a provision permitting him to negotiate negotiate negotiate ne ne- ne- ne with the world powers for a anew anew anew new world gold sold basis if he chooses and can get an agreement The silver people were coyly coaxed into line with the purely optional Pittman Pittman Pittman Pitt- Pitt man plan It is as far lar from real silver inflation as Bryan was from irom Taft All these doses were diluted more than 50 per cent Yet the concoction concoction tion was made to look so palatable they all drank heartily That is good politics Also good statesmanship The two words are synonymous when used in their best sense They both mean good leader leader- ship S The governments government's confidential figures fig fir ures uree on silver sliver Inflation possibilities Indicate the Thomas bill could expand silver with the the- price at 35 2 cents an ounce The expansion would be at 50 cents an ounce There are already of silver sliver certificates outstanding S Confidentially Glass felt the Roosevelt Roosevelt Roose Roose- Ivett velt program would wreck the federal reserve system That's his baby Other authorities felt his fears were groundless It U may deprive the federal fed eral reserve of control over the capital capita mone money market It will certainly put the reserve system under administration tion jurisdiction The change will hardly be noticeable The federal reserve was always supposed supposed supposed sup sup- posed to tobe tob be a a separate institution but it never was Mr Harding controlled it So did Mr 1 Coolidge nad Mr Hoover Those around Premier MacDonald whisper his his v visit it was purely a stab I In the da dark k to get war debt revision I so far as he was concerned They admitted he had little Interest in anything any any- t thing else I On their arrival here they took a avery avery avery very dark view of prospects for the confer inferences conferences They knew he had netting nothing noth netti ing ng to offer and did not then know what Mr Roosevelt had 5 5 5 While the Inside facts disclose lose the hopes lopes and intentions of men at the top they carry no guarantee aders will readily tell you oU confidentIallY confidentially that no one can be certain ho things will turn out IIi In fact they hey know very little littlemore more about it itin than in yo you do That is the main reason for tor confusion in early newspaper news news- paper reports of what was up Each official had a different idea Woodin never thought the U. U S S. would go off the gold standard but his hand did not shake nor his pulse quicken when he signed the embargo author author- ration Some people give Huey Hucy Long ong credit for starting the gold cm em- jargo bargo b business siness That is not correct cor car as as' as he made his senate speech on Monday and the decision had been made nade the previous Saturday It leaked out in In the foreign exchange market in New York 24 21 hours before It t was made public The boys in inthe the know there cleaned up plent plenty NEW YORK By 1 James McMullin The authority given riven to the dent to devalue the dollar is seen seen here as an astute maneuver r to get the he q question out of congressional I clutch clutches New York Is in favor of that No Noone one here expects expect him to act acton acton acton on It unless all aU other measures fall to produce results The gold reserve behind the federal federal fed fed- eral reserve not notes s Is expected here hereto hereto hereto to be slashed from 40 per percent cent to 30 or even 30 20 0 per cent as a further gesture ture ure to appease the But this Is a very different t matter from reducing the gold content of the dolar dollar dol dol- lar ar Itself After all aU If you cant can't demand demand de de- de mand redemption of your dollar what difference does it make m If the reserve reserveS Is S 80 per cent centor or 5 per cent The senate committee amendment to the Inflation measure authorizing the federal reserve board to Increase or decrease the reserve requirements of member banks Is i rated as extremely extreme extreme- Iy ly Important It amounts to this If the member banks are willing to join voluntarily In the program by buying large larre quan quan- titles of governments well governments well and good rood If U not they can be compelled to keep more funds on deposit with the reserve re reo re- re serve servo banks as reserves reserves and the reserve reserve reserve re re- re- re serve banks can use these funds for forthe forthe forthe the same purpose S S The provision n that the government can issue three billion dollars oi of United States notes to retire or buy in federal obligations if it the federal r reserve banks dont don't coo cooperate rate in open market operations is a nifty show show- window exhibit Federal reserve statements in the next few weeks will show the reserve banks cooperating as they have never cooperated before That goes lor for the Chicago bank too too too- the rebel against the earlier open market program But the alternative has sense as an anchor to windward Even with the reserve board itself in full sympathy with administration policies it would be possible if unlikely for individual ual reserve banks to block the government gov gay program This is because majority m directors of each reserve reserve bank are named by bythe the member banks and not by bythe the government Now if by any chance they dont don't behave the government can simply take away their control of currency Governor Harrison of ot the New York Reserve bank helped the program considerably behind the scenes He may get a reserve board appointment out of ot It It but it is unlikely to be the chairmanship New York doesn't rate that today a S There Is no Ino cause for worry about aboul government bonds Determination toke to ke keep p them up to scratch Is clear between between be be- tween the lines of every measure This Is seen here as one of the most Imp Important reasons why nobody Is goIng go- go lug Ing to monkey with the number of grains of 01 gold In a dollar S S I New York bond men still haven't figured out ut what will happen to bonds in general A certain broker spent allone day filling bond buying orders from one important bank with simultaneous simul selling orders from an equally important Institution Neither bank knew what the other was doing S S S SIt If It you cash a check In New York these days you will probably find that the money you get will either be the new new federal reserve bank notes or orthe orthe orthe the bank notes of the Chase and National National Na Na- City City- banks Word has quietly gone out to stimulate the circulation of ot currency backed by bonds Instead of gold Both the Chase and National City are arc gradually s stepping epping up their note issues to the legal limit Umit That's practical cooperation with and from irom Washington The Chinese government has profIted prof through the wholesale dismissals of German civil servants by Hitler A Ii considerable number of highly placed former Germ German n government officials laIs have been hired by China to reorganize her administration The contingent Is headed by Dr Jaenicke rho who was Wal governor of Potsdam lie He has the reputation of being one of the most mOlt efficient men then In the German bu bu- bu reau rests S S Inside onlookers believe that events at it await two conditions First something to distract to-distract w world at at- elsewhere Second outcome of f the campaign recently launched seeking support from Irom Chinese fac fac- ons Japan invites any Chinese party parly willing to befriend her to sJ si signify the fact act An unde understanding with close cooperation will wUl follow The secret response of many small factions is anticipated |