FARCE OF GOLD

Evening Post, Volume CXXIV, Issue 61, 9 September 1937, Page 7

FARCE OF GOLD

AMERICA'S MILLIONS

THE GREAf VAULTS OF TEXAS

STRANGE EVENTS

Everyone has heard of the Great Gold Panic that began in April, but how many know what it really means? asks a writer in the "News Chronicle." Hundreds of speculators were ruined, firms discontinued business, other concerns had to seek assistance, many gold shares fell to half their former value. In the wake of these tumbling gold shares there was a wholesale slide in commodity prices. Why? General Smuts has declared that the present position of gold is'as safe and sound- as ever, and that "the rumours which were'responsible for the slump were not founded on fact. They were only meant to mislead and were.calculated to persuade shareholders to sell or lose, so that others, could buy and make a profit." Thousands of workmen have toiled to complete great forts of steel and concrete. Guns grin from cunninglybuilt embrasures. Armed.men patrol the ramparts.. The forts bristle with alarm signals, automatic devices to trap the unwary- Searchlights probe I the night sky. Armoured cars apIproach the forts. Syrens wail and ! arms clash as they are admitted into j the forts to discharge their precious cargoes. Keverently the soldiers take heavilysealed boxes to a room where they are checked and listed under the eyes of guards with.restless trigger-fingers. The solemn hush deepens as other acolytes take over the mysterious cases and just as reverently bear theni down .. . down . . far below the level of the ground. There, in Texas, U.S.A., in long, spotlessly-clean vaults, where it seems improper to talk above a.whisper, ths cases are gently laid to rest. THEY DARE NOT USE IT. A few muttered words ... a few cabalistic scrawls . . . and the vaults, which contain thousands of these cases all neatly stacked away, are left in silence save where one watchful high priest pads around. Sounds like a ritualistic burial, doesn't it? And that is exactly what it is—the burial service of two-thirds i of this world's gold. It. is also the latest act,in,one of the maddest, craziest farces-the earth, has known since .Midas acquired the magic golden touch,, then found he couldn't cat gold. These forts have been built abovs vaults which contain America's "sterilised" gold, just £2,000,000,000 worth. ' Aladdin's cave looks like a pawnshop beside these vaults. The ingots and' cases are classified not in ounces or pounds, but in ton after ton of pure gold—the greatest weight man has ever hoarded in one place. And it has to stay buried. < America has bought it—and is still buying it it £7 an ounce—but. America dare not use it. . . . . • Two-thirds of the world's gold, suddenly released in America, would make a golden flood that would do more damage than the waters of the mad Mississippi. Everyone would be rich—for five minutes. Then as prices would rocket sky-high, America would realise that where everybody's a millionaire, everybody's a pauper. The gold gang started going crazy when six years ■ ago Britain suddenly boosted, the price of gold to £7 an ounce* The first act in this mad drama was the start of the most exciting series of gold-rushes, since a boastful sailor blinked at seven tiny specks' of gold on a dirty rag—and Australia was on the gold-bearing map. GOLD FEVER SPREADS. - Pathetic mining-towns, deserted and decaying, suddenly filled with excited prospectors. "Go home," sneered the old-timers, who knew that a gold-rush yields a million heartbreaks for one fortune, "all the gold about, these parts has been taken." They might as well have tried to turn back the tide. At the start of 1933 fheje were only twenty-eight gold mines in Canada. By the winter, there were nearly ninety. Swiftly the gold fever spread to Rhodesia, East and West Africa, Australia, and New Zealand. Another expedition set out to recover King John's gold from the Wash! Soviet prospectors braved the rigours of Northern Siberia. Capitalism might be condemned by Moscow, but hundreds of

bearded comrades faced the blizzard, hoping to scratch some gold from the ice-bound soil. Aeroplanes were pressed into service. . Sir Malcolm Campbell caught the fever. He took two light aeroplanes to the Namib Desert in South-west Africa where an unworked gold reef was said to exist. He trekked through the scorching desert, head bent before the scorching sixty-miles-an-hour gales which hurled burning sand in his face. . And he saw what might stand as the symbol of all gold-rushes. Skelfitons of men who had perished of tnust in this living hell, skeletons that were picked clean and polished to the whiteness of old ivory. When, he came to the site of the reef, it was buried bsnenth millions of tons of sand. Others were luckier. In 1932, enough gold was dug out of the earth to make a solid cube that would fill a room 12ft by 10ft and Bft high. That golden cube would be worth £100,000.000. There were some peonle who muttered: "This is crazy! Gold is in disgrace as a standard of value. And forty-five countries have abandoned it." HAD NO LISTENERS. But who bothered to listen to a lot of musty economists while Arabian Nights stories were going the rounds? One Johannesburg prospector bought a plant for £300. Within a year he was getting £200 worth of gold every month. Another miner, sold his claim for £25,000. His friend, after a drunken tout, sold an equally valuable claim for £25. Stories like these drive men mad. The farce was beginning to get lively. True, there were not the wild scenes of the old-time gold-rushes. Nobody drank champagne out of a bucket. Nobody shod his horse with gold. Nobody lit his cigar with a £10 note. But the grave financiers, the international speculators, outdid the old miners in crazy comedy. World production of gold rose to £240.000 000. Yet practically the whole world had abandoned gold as a standard of value. Indian princes raked out their treasure chests and sold their gold at peak prices. Queues of people gathered in every town in Britain to sell - their sovereigns for 30s apiece. The golden stream became a mighty river sweeping westwards across the Atlantic. Yet America was buying. By law. she hfd to buy all the available gold. Suddenlyl/ the whole thing tonnled over and America was left bewildered while still more gold showered in. America didn't want to use •it. So the Texas vaults were built. That gold is "sterilised." It must not, cannot, be brought above ground now. Yet even as you read these words, projectors are wrenching fresh Sold from the earth and sending it to America. RETURNS TO THE EARTH. It travels thousands of miles, chaper-j oned by machine-guns, ringed by bayo-.| nets —to return to the earth. There it must rest, for this gold is more dangerous than dynamite. A charge of dynamite might blow half a city to the sky. Release of America's gold would cause a financial and social panic that would make the Wall Street slump look like a picnic. Do you know the story financiers tell about gold today? It goes like this: Once the nations of the world decided to dump all their gold on a lonely Pacific island. Nobody was to touch it. All finance could be done by, bookkeepers who could transfer notes from one nation to the other. The total on the island would remain unchanged: They worked for years. Printed bills, instead of bullion shipments, settled international debts. Then, one summer, a big banker thought he'd take a trip to this island to see how the gold was getting on. He found that there had been an earthquake. The keepers of Treasure Island were dead. Every ounce of the gold had been swallowed up by the earth. Yet the financial business of the world still went on smoothly. The gold farce has almost reached this stage today. Men have fought nnd lied and cheated for gold. They have been whipped by the winds of the north and scorched by the storms of the desert. Gold has turned men into heroes—-and devils.' Its story is a patchwork of treachery, heroism, murder, and sacrifice. Now the financiers are supplying this touch of crazy comedy. Two-thirds of the gold so hardly won is shipped half across the world, escorted by ma-chine-guns and armoured cars, and politely put back where it came from —the depths of- the earth. There it rests, a golden memorial to mankind's most spectacular farce.