GOLD RESERVES.

Press, Volume LXVI, Issue 20090, 20 November 1930, Page 10

GOLD RESERVES.

HOARDING IN FRANCE AND AMERICA. EFFECT ON WORLD PRICES. LORD »ARNB\''S OPINION. The hoarding ot gold reserves by I'rauce, and to a less extent by the Lnited btatea is, in the opinion of Lord Ba in by, a member of the Advisory Council to the Lconoinic Committee of the League of Nations, the chief reason for the present world-wide depression. lie hopes for a recovery by agreement thfough the Dank of International Settlements, but insists that Prance stands in the war, Apart from his work on the League, Lord Ham by is a director of Lloyds Bank, with which the National Bank ot New Zealand is affiliated, and an outstanding tiguro in British industry and finance. Hopes of Agreement Fading. "My experience on the Advisory Council to the League has definitely | been disappointing, and it sceins that the earlier hopes of international agreement on economic problems are fading,'' ho said yesterday to a reporter of The I'kkks. ' Our greatest failure is due to France's attitude on the question of gold reserves. France's attitude of accumulating gold is doing more than anything else to contribute to the protent decline in world prices. "No doubt the general perplexity of falling prices in one important part >f the problem," he continued. "Commodity prices are declining in terms of gold, which is only another way of Baying that there are insufficient gold reserves. Until the production of gold is increased by new discovery, which is not likely, or by a better distribution of the available supplies, there is not much likelihood of an improvement in world prices, or of the lifting of the depression. The attitude of France ?s :< serious handicap. Absorption of Gold. "Figures show that the absorption of gold by France and the United States in the past two yearß has not only equalled the normal new reserves, but has depleted the existing reserves. This withdrawal of gold is decreasing pur chasing power, and bringing about a decline in prices. "There is hope for agreement through the Hank of International Settlements which would bring together the heads of the different banks of the world, and enable' theni to work out a policy to make better use of the reserves, and bring about a return of world prices. I sincerely hope that this may occur, but France iH the difficult".-.''