THE £ AT 16/.

Auckland Star, Volume LXII, Issue 283, 30 November 1931, Page 10

THE £ AT 16/.

WHAT "EXCELSIOR" SAYS. WAS IT MR. MONTAGU NORMAN ? FINANCIAL STABILISATION PROBLEMS. (From Our Own Correspondent.") LONDON, October 24. iProbably no point in tlie present crisis ie intriguing the world so much as at what point the pound will be-stabilised. Lord Reading some days- ago mentioned 100 francs, or 16/, and I Save been given that figure by a Paris journalist in London even earlier than that date. * Now we have the Paris paper "Excelsior" publishing a long interview with an unnamed who, from internal evidence, can be none other than Mr. Montagu Norman, director of the Bank of England, repeating the 16/ figure. What France Needs. "/ This interview in "Excelsior" is important for more than its figure for stabilising the -pound. The unknown director of the jsank of England says "the French, public need instruction in financial matters, and should learn that there are great differences between one country and another. There are nations that still, know how to keep their word and will always honour their engagements." .' Not Avarice! "He does not agree with Lord Rothschild in the view that the real cause of the world crisis was the avarice of France and the United States. "Not in the least," was the reply. "It is true," the director said, "that France was keeping a large quantity of gold in her safes instead of allowing it to circulate, but, to be frank, he quite understood this attitude. The French public had had disastrous experiencee in the matter of foreign loans —for example, the Russian and Ottoman debts—and after these misfortunes it was not surprising that Jacques Bonhomme, hesitated to take his savings out of. his stocking." "•■,'..■•

The English public, said, was calm and disciplined, and that was enough to guarantee that stabilisation would not cause a greater shock than the abandonment of the gold standard. If, the director said, the public had lost their heads at the moment when the pound depreciated, and there had been a run on the banks, England would not have got out of the affair without great injury. i Change in City Finance. """ He stated definitely that stabilisation could be realised without there .being any necessity for a loan of any sort. Further, he said that the restoration of British finance depended to a great extent in a change in the financial policy of the City, which hitherto consisted in forcing loans on £be foreign markets. This policy was no longer practicable, and those that had pursued it" had paid dearly for their experience. He gave, after some consideration, hie vie.w of President Hoover's credit plan. "It had," he said, "made more noise than it deserved." "The 'big banks, he continued, had always been ready to help active enterprise whose prosperity was paralysed only by lack of capital, and President Hoover's idea was only the same thing on a larger scale. The , director went on: "We muet not expect miracles from an operation of this kind*. The New World is as sick as the Old. When I wae recently travelling in Canada X saw not far from Ottawa thousands and, thousands of tone of wheat being burnt because they could not be sold."