GOLD POLICY OF U.S.

Press, Volume LXXIII, Issue 22197, 14 September 1937, Page 9

GOLD POLICY OF U.S.

IMPORTANT CHANGE ANNOUNCED INACTIVE STOCKS TO BE RELEASED ASSISTING GOVERNMENT'S "EASY MONEY" PLAN (UNITED TRESS ASSOCIATION—COPYRIGHT.) (Received September 13, 11.30 p.m ) WASHINGTON, September 13. The United States Treasury has temporarily reversed its gold sterilisation policy, begun on December 22, 1936, under which it accumulated 1,335,000.000 dollars. It has now accepted the Federal Reserve Board's recommendation that 300,000,000 dollars of gold should be transferred from the inactive account to a deposit account with the reserve banks in a co-or-dinated effort to maintain the Administration's "easy money" policy. Under its gold sterilisation policy the United States Treasury purchased gold at an inflated' price of 35 dollars an ounce, with the object of preventing it from coming into the money market and causing undesired fluctuations. Such gold was sterilised or kept inactive so as to retain intact the national credit structure. Early in August, six Republican members of the House of Representatives banking and currency committee urged that this hoarded gold should be applied to the reduction of the national debt. It was then stated that the United States held more than half the gold in the world and severe criticism was directed against the Administration because it was borrowing heavily to purchase gold which was only "buried."' It was claimed that the application of this gold towards the reduction of the national debt would save the taxation necessary to pay interest on the bonds with which the gold was purchased.