THE TRANSFER OF GOLD.

Press, Volume LXVIII, Issue 20731, 16 December 1932, Page 11

THE TRANSFER OF GOLD.

CALL ON THE BANK OF ENGLAND.

CONTRACTION OF CREDIT EXPECTED. (Received December loth, 5.5 p.m.) 'LONDON, December 14. A number of back benchers continued the debato on war debts in the House of Commons. Mr Neville Chamberlain, replying, explained that gold xvould be taken from tbo Bank of England issue department and paid for at tin. current price in Treasury Bills. Tho bank would keep £19,500,000 as the value of the purchase of its gold. Tho other £10,000,000 would go into the exchange equalisation account, where it would remain as an asset until it was requred to buy gold again. It Was true in one sense that if the fiduciary issue was not increased there would bo a contraction of credit, but sufficient credit was available to make it unnecessary to create more unless unforeseen circumstances arose. Mr Chamberlain said that tho friendly tone of the United States Notes was a good augury for the success of tho negotiations to bo undertaken to settle finally the long-vexed problem. 'An earlier message from Rugby stated that arrangements had been completed through the Bank of England and tho Federal Reserve Bank of America, whereby tho British payment of 95,550,000 dollars in gold would to-morrow bo at the disposal, in Now York, of the United States Treasury. It was believed that no further communication is likely regarding this payment. Foreign exchanges ruling in Loudon were: New York, 3.28J, against 3.27J overnight; Paris, 84-J, against 83-J overnight. BRITAIN'S PRESTIGE, IMPRESSIVE COMMONS DEBATE. (Received December 15th, 11.45 p.m.) LON'DON, December 15. Though the House of Commons is not permitted by division to register its opinion on the debts decision, the debate was both impressive and exciting. Tile House was crowded and the American and al! foreign Ambassadors were present. If a vote had been taken it would havo been overwhelmingly in favour of tho Government, as it was realised that British prestige was bound to gain as the result of to-morrow's payment. Tho "Daily Telegraph" describes the debate as a plain and unanswerable vindication of Great Britain's debt policy.

SATISFACTORY DEBATE. COMMENT BY "THE TIMES." LONDON, December 15. (; The Times," in an editorial, says: "The House of Commons debate showed the Government's decision to pay. It interpreted also tho unanimous wishes of the House, which shared the Government's opinion that anything savouring of unilateral repudiation would be a deplorable mistake. "Sir Robert Home's speech should finally dispose of the mischievous fairy tale that Mr Baldwin riveted the burden of the American debt to Great Britain's neck ,when he went to Washington in 1923. Though Mr Lloyd George derided tho House of Commons as 'gibbering ih a cornel-,' the debate proved that the Mother of Parliaments has no reason to fear comparison with either the French Chamber of Deputies or the United States Congress. INDIGNATION IN CONGRESS. THE FRENCH DEFAULT. SOME REPRISALS SUGGESTED. WASHINGTON", December 14. .Disappointed and confused by the French insistence on a conference, the United States Government to-day nevertheless held firmly to its attitude toward Europe on war debts —"pay or default" —but underneath official Washington tan a current of suppressed e±citcmont.

\ Inasmuch aB the United States Government considers it spoke plainly in its replies to every request for a moratorium extension, the indications were that White House and the State Department would keep silent until tomorrow, the date when tho payments are due. Should France, Belgium, and other nations default, President Hoover may propose a new study of the debt question, as ho has indicated. Isolation of France. France is viewed in official and Congressional quarters as being in an isolated pdsitios. Inasmuch* as the Government has not been advised officially that payment will not bo forthcoming, the State Department awaits the expiration of the time fof payment before making any announcement as to what action Will be taken. The negotiations between France and the United States for a commercial treaty probably will be suspended automatically, fss the conditions will not be favourable for its continuance. Mr Harold Knutson (Heptiblican, Minnesota) to-day introduced legislation in the House of Eepresentatives to forbid entry into tho United States of securities of foreign Governments that have defaulted on debt payments. The measuro would aiso prohibit advertising them for sale and the carrying of such obligations through the mails. Comparison -with Germany. Congress alone can alter the existing arrangements, and expressions of indignation came from members at to-day's session. Senator K. D. McKellar (Democrat, Tennessee) said it was clear that Germany was not the only European nation that" treated its obligations as scraps of paper. "I think it is the most ungrateful act in the career of any nation in the world," he said.

Mr S. D. Mcßeynolds (Democrat, Tennessee), chairman of the House Foreign Affairs Committee, said: "France has less excuse not to pay than any other nation. The settlement made with her was only 75 per Cent, of What she deceived after the war. There is no question about France's ability to pay. I admire very much the strenuous fight made by M. Herriot, but apparently his Oppositions ran wild." Senator C. L. McNary, the assistant Kepublican leader, said: "I cannot foresee what we may be up against." Senator Hiram Bingham (Republican, Connecticut) said he had not Supposed the French, whoso business sense was so acute, would default. "They forget

that had wo been unwilling to lend the money they needed when they needed it, and on reasonable terms, the result would have been fatal to Trance." Senator Harrison, a Democratic member of tho Senate Finance Committee, said: "France's attitude is incomprehensible to mo." One prominent Democratic Senator, who refused to permit his name to be used, hold tho view that the restilt would be so embarrassing, to Trance that she would regret having pursued that course. The United States could not afford to ignore it.