SILVER AGREEMENT

Nelson Evening Mail, Volume LXVI, 23 December 1933, Page 7

SILVER AGREEMENT

RATIFIED BY ROOSEVELT

EFFECT OF DECISION (United Preen Association—lly Electric Telegraph—Copyright.) WASHINGTON, 21st December. President Roosevelt on 'I liursday night formally ratified the London silver agreement. and ordered the Government to purchase metal at 641 cents an ounce, which is half the legal price and about 19 cents above the current market price. WiLL STABILISE PRICE MUZZLING OF INFLATIONISTS (Received 23rd December, 8.25 a.m.) WASHINGTON, 21st December. “This proclamation,” said the ITos,dent, “in accordance with act of Congress, opens our mints to the coinage ofrstandard silver dollars from silver hereafter produced in the l nited States or its possessions. Half of the silver presented will be coined at the statutory price of 1.2!) an ounce, and the remaining half will be “surrendered to the Treasury as seigniorage and to cover the usual charges and expenses.” It is estimated that about 24,000,000 ounces will be purchased annually. This figure, approximates the amount stipulated by the London Treaty which America will buy annually.' It is understood that President Roosevelt decided to rati tv Hie agreement following India’s acceptance. Silver advocates are jubilant at tbo President’s action. Senator Pittman, author of the silver agreement, declared. that exports to oriental and other countries with silver as the base will be greatly increased. “The action of the United States will he followed byCanada, Australia, Mexico and Peru and undoubtedly will stabilise the price of silver throughout the world at (!4i -cents until some further action is taken to raise it higher.” Observer are agreed that the President has done much to muzzle congressional inflationists.

FOREIGN EXCHANGE CIRCLE TAKEN BY SURPRISE NEW YORK, 21st December. • Foreign exchange circles were taken completely by- surprise by President Roosevelt’s remonetisation of silver announcement. One silver expert declared that since the United States produce? currency- only- about one-sixth of the worlds’ production of silver the cll'ect of purchases upon the world price is likely to he no greater than has been the effect of the Reconstruction Finance Corporations’ purchases of newlymined gold upon the world gold price. The question immediately arises, therefore, whether the present announcement may not he the forerunner to purchases of silver -produced abroad. It is predicted that the immediate market response is likely to he strongly- rising prices, but it is doubtful if they- will hold unless followed by authorisation for purchases abroad.