EMPIRE CURRENCIES

Hawke's Bay Tribune, Volume XXII, Issue 204, 12 August 1932, Page 7

EMPIRE CURRENCIES

CO-OPERATIVE CREDIT USING MORE SILVER. MIDLAND BANK DIRECTOR’S SCHEME. (United Press Association—By Cabls Copyright*) (Received 12, 10.30 a.m.) Ottawa, Aug. 11. Mr. J. J. Darling, director of the Midland Bank, gave a luncheon to journalists and outlined a scheme of Imperial co-operative credit. He urged a “merger” between the pound sterling and the Canadian dollar as the first step towards bringing the whole of the Empire currencies together. He advocated creating a supercentral Empire bank with credit of £100,000,000. This credit would be created by each Empire Government undertaking to repay—in gold. at the old parity rate and bearing interest, say, at three per cent.—its share of the credit. Government obligations would take, the form of Treasury bonds ultimately payable in gold. It was unlikely that they would be called for, but they would have the force and value of gold security. The credit balances thus created would be used to settle the balances of payments between the British Empire countries and as a basis for local currencies, thus being considered as the equivalent of gold. BACK TO SILVER. Mr. Darling again emphasised his belief in the monetisation of silver as the most effective way of raising world prices. The profits of the super-central bank could be used in the first instance to purchase silver with this objective. Only 117,000,U0Q ounces of silver were lequired to restore the fineness and increase the weight of the Empire silver coinages to those of the Indian rupee at its present sterling equivalent of eighteen pence. Mr. Darling’s definite aim is the establishment of international bimetallism by using more silver as money. He used as an illustration the fact that millions of Indian women were carrying all their savings on their persons in the form of bangles, earrings, trinkets, and ornaments and said that they would purchase more goods in silver were given a new value. He said, “The credit system is not now functioning, but it is not through lack of credit; it is through lack of security on which to lend.” Mr. Darling said that he had not read the conference’s currency report, but his effort to secure new world-wide publicity for his well-known views at this juncture was obviously made because he was aware that the conference experts have not agreed upon the idea of an Empire bank and have not mentioned silver. SOUTH AFRICAN VIEW. Mr. Havenga took the view that South Africa was at present wedded to the gold standard and that a central bank was unacceptable because it might be construed as conflicting with the dominions’ prerogative powers as self-governing units. It would not be surprising, however, if aa Empire bank proposal were yet included. The report before it would be issued to-mqrrow.