OFFICIAL VIEW ON DECISION- British Cabinet's Policy On Devaluation

Greymouth Evening Star, 23 September 1949, Page 6

OFFICIAL VIEW ON DECISIONBritish Cabinet's Policy On Devaluation

LONDON,. September 22.—“ There is little, doubt about the lines, on which theTkitish Government’s, policy to devsiie ? the pound W. bo-defended in Parliament,”' says the political correspondent of the Daily Telegraph. “The country will be., told that it was the only alternative to unemployment. “The Minister of National: Insurance; (Mr James Griffiths) has already suggested,that the choice was between devaluing the pound or- devaluing the .-workers. The Chancellor of the Exchequer (Sir Stafford Cripps); said in his, broadcast last Sunday that ‘in the old days’ the price-reduction desired would; have been forced ‘by creating unemployment and bankruptcy.’ .

, "‘'‘The Prime Minister (Mr- Attlee);, who will address, a Socialist'rally in North Wales next Saturday, (v.jli probably take the same, line and it will be Sir Stafford; Cripps’s main argument when he meets the general, council of the Trades Union, Coxir. gress next. Monday.” , ' . The labour correspondent of The Times says: “There is not at present any indication that the general council of the T.U.C. will revolt against the Government’s policy. A significant pointer, was yesterday’s decision of the National Union of General and Municipal Workers, which, with more, than 800,000 members, is Britain’s, second largest union. “Grave Situation” “The union considered ‘the grave situation, which has resulted in the revaluation of the British currency,’ but concluded that there was no reason to depart-from its support of the Government's- wage-curbing.; policy. This ? - however, added -the union, would not preclude it from making a demand for wage increases for its lower paid members.” The political correspondents of the Daily Telegraph and the Daily Mail say that Mr Attlee made the final decision on devaluation while Sir Stafford Cripps was undergoing treatment in Zurich. The first indication Sir Stafford Cripps had that his policy against devaluation had been thrown overboard by Mr Attlee, was a message to him in Switzerland, according to the Daily Mail. When Sir Stafford Cripps returned to London, Mr Attlee told him- that there could be no reversal of his decision. Price Of Argentine Meat The British Ambassador to the Argentine (Sir John Balfour) has denied that the devaluation of .sterling entitles the Argentine Government to increase by 30 per cent, the price of meat sold to Britain under the recent trade treaty. He cited Article IX of the which, he said, fixed the prices-for the first year of the treaty, and left no way of altering them until after that period. t Earlier, high Argentine officials had said that devaluation would “obviously entail a parallel 30 per cent, increase in meat prices.” The boom in gold shares which was started on the London market by sterling devaluation was put into re--1 verse yesterday by the South African Government’s statement that the Erfdeel gold strike was a fraud. Instead of the expected rush to buy, the new account started with losses of up to 5s in as many minutes. British speculators vied with those of Johannesburg to unload shares on dealers. Industrial shares fell on the London Stock Exchange yesterday as the result of a rumour that the Trades Umpn Congress would urge the Government

tn introduce a 100 per cent, tax on excess profits. The general council of the. T.U.C. has not made any definite announcement of such a move.

Buying Surge A buying surge inspired on the New York Stock Exchange by hopes that the threatened American steel strike would be averted increased values yesterday by a few cents to around two dollars a share. The final prices were the best of the day, the market ■ closing on a strong confident note. Almost every group joined in the forward movement. Yesterday’s rally followed one of the steepest slides of the year when substantial selling was inspired by the deepening gloom which surrounddr the labour outlook.