Show 0 national topics interpreted by william bruckart washington the presidents move now sanctioned by congress to provide us with a dollar means that bat has a higher prices ing 8 rower power ot of not dot to exceed sixty cents by comparison with the dollar that hag been our medium of circulation so long has caused about as much controversy tro versy in the national capital as anything that has been done under the new deal nor Is there at this yme any possibility of either tide side giving up in their arguments for it must be said eaid frankly that there Is merit on either aide of the proposition I 1 sir mr roosevelt has elected to adopt a course that means roughly the establishment of prices for everything you sell at levels that approximate the range of at tile the same time it means that roughly everything you buy will be proportionately higher than the prices that have obtained during the depression thus thugs tt it must become readily apparent that raw materials terl te rials als such as farm commodities for example are going to return more to those who are the source of that supply than they have been receiving lately coincidently everything that the farmer buys will have jumped up in price and in between we find the individual who lives by the sweat of his brow the so ro called white collar worker of the office and residents of towns or cities who will pay more for everything and without any perceptible addition to their income the theory that has been advanced by those who support the presidents plan Is that it will start a larger return of cash to the farmers and that when such a result Is obtained an extended expansion will take place in the general cycle of business in other words it Is their contention t that bat the agricultural industry constitutes a key hey that will unlock the door of a more prosperous era er a on the other side of the argument one hears bears the insistent contention that nothing has been gained actually by reducing the value of the dollar as measured by gold assuming that there will be tile the restoration of 1926 price levels say opponents of the presidents course what will have been gained for the farmer when the things he has to buy are increased in price and the buying power of the millions who live in cities towns or villages has been reduced and it cannot be denied that after all tile farmers market Is in those areas it Is equally true that wages never keep pace with increasing prices and the natural result of this disparity Is to force the residents of urban communities to cut down on their purchases pure bases even it if that entails reduction of the food they buy they cannot buy it if theado not have money what has happened to the dollar itself by the presidents action the answer is nothing fight over that Is correct if money one considers only the physical dollar of silver or dollar in paper currency cut but the effect of the action Is the bone of contention and from what I 1 have read of this nations political history anybody can be assured of a red hot argument over proposals for tinkering with our form of 0 money mr air roosevelt has done it ft however an and I 1 he be moved so fast that there has been argument after the fact rather than before it was accomplished for that reason it appears certain you will hear bear arguments of a serious nature and maybe a few fist lights fights over money questions through several elections to come to get back to the dollar again the president asked congress to prescribe the limits of tile the or to say it another way ho he asked congress to enact legislation for which it is responsible to the people of course that will let him proclaim a new dollar value as measured in terms of gold lie ile told congress that the upper limit should be sixty cents and tile the lower limit should be fifty cents the old dollar was rated as worth 2067 grains of fine gold the minimum or fifty cent dollar would be worth iusi just half of that amount of gold and the sixty cent dollar would be proportionately more when the terms fifty cent dollar or sixty cent dollar are used here they are for purposes of comparison with the tl long established dollar that was valued at 2007 0 grains of gold and gold Is the accepted basis of international trade whatever america does however does not alter that badts and consequently the new blew roosevelt dollar assuming it stands at 1034 grains of gold will be worth just half as much in foreign purchases as the former dollar was worth so as I 1 stated above there has been nothing happen to the tha physical currency the lias has been manifest only in the effect you can change a dollar bill into two fifty cent pieces or four quarters or ten dimes or twenty nickels or one hundred pennies under the new scheme as well as before but when you change that dollar into commodities a pair of shoes a shirt a I 1 dress or a suit of clothes it it works out to increase prices as mr roosevelt contends the tha result will be plainly apparent it Is apparent to most anyone th that at the full force and effect of the alie presidents action will not be wholly marili test feat tor for some time conditions have to adjust themselves pat lint the sponsors of 0 the new arrangement for money have not been able to explain to me why the artificial boosting ot of prices may not lead to ultimate evils I 1 mean by that to inquire why if the prices are started upward we may not expect to see them reach a level that Is disproportionately high a level that will have the same effect upon you and me in our dally daily buying that drained our resources during the world war the legislation affecting monetary matters which the president asked congress to enact in treasury eluded authora authority ty for holds Hold all sAll gold in to take tahe the gold eold that the federal reserve banks have stored up it amounted to approximately all of this gold now becomes the property of the treasury that agency of the government therefore possesses all of the gold for monetary purposes that there Is available in this country when the treasury has taken it over it will pay the federal reserve banks in gold certificates yellow backs of the type that used to be in circulation cut but the irony of the ho thing is that the reserve banks cannot cash those certificates it must simply hold them awaiting awal tind the pleasure of the treasury because they are to be redeemed at the pleasure of the treasury of course the reserve banks will be allowed to use them as they used to use gold 1 federal reserve notes can be issued with the un uncas cashable liable gold certificates as the collateral instead of gold the reserve banks therefore simply had to obey the decree of the federal government and turn in their good gold as every one else individuals or corporations the federal government Is going to use two billions of tile the gold taken from the reserve banks to establish a stabilization fund simultaneously the secretary of the treasury has been given authority to buy or sell international exchange that Is he be can buy british pounds or french francs or german marks or he can sell dollar exchange or buy dollar ell exchange dhane dhan e money aroney from the stabilization fund will il I 1 be used the purpose of this Is to bring about a balance between the amount any na tion pays the united states and the amount paid by the united states to that particular foreign country by that method no gold would have to be transferred or only small amounts would change hands thus it Is claimed the new value of the dollar will ill be maintained at what am amounts to an even trading worth insofar as foreign nations are concerned of course it Is not actually the nations that are concerned but the business of those nations that makes international trade causes the sale of wheat or cotton or corn or hogs and t the lie purchase of coffee of sugar of novelties or the hundred and one other items no one seems to know how much it will cost to maintain tire the dollar on a stable basis as measured in internal dional trade when the president provided for a two billion dollar stabilization fund he apparently was guided by the size of the british fund which was created for exactly the same purpose namely protection of the british pound from being made a currency that nobody wanted 0 a another phase of the monetary program upon which sir air roosevelt has launched seems to credit warrant discussion control the new legislation cs has the effect I 1 am told by authorities of giving the treasury the greatest power it has ever held in the matter of credit control it has taken over this power from the federal reserve system which was created under the democratic administration of woodrow wilson to provide a flexible currency for business its purpose was to make certain that as business expanded and its need for more currency developed the federal reserve banks could supply it whether that purpose has been destroyed authorities inform me it Is too early to tell but from all of tile the fear that Is evident in some quarters there must be at least some threat of danger I 1 have been told too that the legislation almost makes a central bank of the treasury if that be true the treasury will be able to tell tile the federal reserve banks to some extent how bow they shall run ran their affairs how flow high or low their rates of discount shall be perhaps that does not seem important perhaps it appears to be tar far removed from life in a small town or in a city but it Is of direct consequence to the little general store or the larger department store or the hardware denier dealer or the druggist or any other business the discount rate more frequently than not determines the interest rate which your local business man must pay for money lie he borrows nc he must figure the interest as a part of Ms his business cost and add that to the price we pay for the things we buy if I 1 were to select one phase of the central bank idea as being more objectionable than another it Is that too much control Is belner belne concentrated in washington washington is permeated with politics 0 by western newspaper union |