AMERICAN FINANCE.

King Country Chronicle, Volume XXIII, Issue 3073, 31 October 1929, Page 4

AMERICAN FINANCE.

No reason is given for the cyclonic happenings that took place on the New York Stock Exchange last week, when, as a cable message stated, over five thousand millions dollars were swept away in one day. Such a sum would liquidate our national debt nearly five times over, and in one day the people of the United States found themselves poorer by this colossal sum. America has been plunging in an orgy of speculation, and the climax came with startling suddenness. The country must begin to realise that true prosperity does not lie in possessing a huge amount of gold, but rather in keeping the wheels of industry turning and by taking part in legitimate trade. America to-day is satiated with gold, and satiation in any form brings many evils, not the least of which is, as an American economist puts it, “in thinking only of the material standard of life, and taking no account of the intangible spiritual elements. - ’ The Americans are thoroughly materialistic. Their politicians talk of ideals, but have not shown any great desire to put them into operation. Surfeited with gold, largely as a result of the country’s delayed participation in the war, the people wanted scope for investment. For the first few years there was no trouble in finding this, for besides an enoi-mous domestic trade, the United States exported huge quantities of manufactured goods to those countries where the war had crippled industries. From a manufacturing point of view, however, the country is rapidly reaching saturation point. The European countries are recovering from the ravages of the conflagration of 1914-18, and every year are becoming in a better position to rely on their own resources, besides which domestic requirements have been met. Up till a short time back the American manufacturers were making huge profits, and plenty of money being available, stocks were on a high level. These profits of late, however, have been receding, and for the last few weeks it has been quite apparent that there has been a certain amount of uneasiness on the various Stock Exchanges in the States, a crisis being reached a few days ago. What the Americans think of the position to-day is had to surmise but many years ago some of the leading economists of the country issued a warning that to try and corner the gold of the world was a distinctly dangerous experiment, and it seems that this prophecy is now being realised. It cannot be said that America is happier because of her great wealth. Her crime record is ample proof of this, while her problem of unemployment is just as acute as those countries which were impoverished as a result of the war. Gold does not represent true prosperity, which means efficiency in manufacturing and trading. iThe country has efficiency. There is no doubt of that, but the peculiar ethics of the people who seek to sell to other countries without taking anything else but gold is partly responsible for the sensational happening of last week, and with a continuance of the country’s present policy these are likely to be repeated.