WORLD ACTION.

Auckland Star, Volume LXVI, Issue 58, 9 March 1935, Page 9

WORLD ACTION.

FOR STABILITY.

ON BASIS OF GOLD.

Economic and Monetary Problems.

CONFERENCE FINDINGS

(United P.A.—Electric Telegraph— Copyright) (Received 12 noon.) LONDON, March 8. An international conference was held on economic and monetary problems, attended by 63 representatives from Britain, Belgium, France, Germany, Italy, ' Holland, Norway, Sweden, Canada and the United States, over which Lord Crewe and Sir Austen Chamberlain presided.

It was recommended that leading Governments, especially France, Britain and America, should consult, with a vi?w to the provisional stabilisation of exchange on the basis of gold and the preliminary establishment of a stable world gold standard. It was also urged that Britain and America, the greatest creditor nations, should consult together and with Other Governments to enable debtors to meet their obligations in goods services. A Paris message says that owing to depreciation of sterling the Government is studying a proposal to restore the exchange compensation surtax when the Franco-British treaty expires on March 31. It is authoritatively stated that the Government will exercise the utmost circumspection on the question unless there is a further serious fall. British Exchange Equalisation. In the House of Commons Mr. D. M. Mason (Lib., Edinburgh East) raised the question of the fall of sterling. He expressed the opinion that the pound would continue to fall until the Government reversed its policy and the Bank of England contracted its note issue. Dr. C. Addison (Lai)., Swindon) asked for information concerning' the £3.50,000,000 equalisation fund. The Chancellor of the Exchequer, Mr. Neville Chamberlain, said the exchange equalisation fund was never used or intended to be used for the purpose of deliberately forcing sterling up or down. It was used to smooth out irregularities in currency values. The change in the external value of the pound was not related to anything which had taken place in Britain. There was absolutely nothing in the position which need give a moment's uneasiness. The internal value of the pound was unshaken. It would buy the same amount of goods now as three years ago. It was very different with gold, , which fluctuated considerably. "As for us attempting, in these circumstances, to try to stabilise our currency on gold," said the Chancellor, "it is clearly impossible. On either side of us there is the franc and the dollar. Both are anchored to gold. Each has no economic relation to tlic other. "Both France and America had enormous hoards of gold, which gave them a dominating position in operating the gold standard. At present we are not in a position to risk putting the pound at the mercy either of the franc or of the dollar. Some day we and other countries, in all probability, will go back to an international gold standard, but we are not prepared to take a step to put England back until we can see conditions so favourable that, having returned to the gold standard, we can be pretty certain to remain there."