GOLD REVALUATION

New Zealand Herald, Volume LXXVI, Issue 23266, 8 February 1939, Page 9

GOLD REVALUATION

REASONS EXPLAINED NO TRACE OF INFLATION MONETARY POLICY UNALTERED (Received February 7, (>.<"> p.m.) British Wireless LONDON, Feb. 0 Before giving'the third reading, with a dobat<>, to the Export Credit Guarantees Bill, the House of Commons heard an explanation by the Chancellor of the Exchequer, Sir .John Simon, of the Currency and Bank Notes Bill. Sir John Simon emphasised several times that there was no question of any change in the monetary policy, and the bill made no sort of difference to the fundamentals of British currency, ft made certain changes in the machinery and it provided for the more accurate presentation of facts by showing the true value of the gold cover for the note issue. The proposals contained no trace of inflation or of deflation.

Recent events, Sir John Simon said, J had made it opportune to introduce I and carry this legislation. There had been a continuous increase over a long period in the gold stock of the country tip to last March, when the combined gold in the Bank of England and the exchange equalisation account reached the value of £8.'55,000,000, But much of that growth represented the deposit in London of short-term funds owned by foreigners, and in the next six months, to September last, the withdrawal of these deposits reduced the combined gold holding to £'680,000,000. The loss of the gold for the most part need not be regretted, lor it meant the removal of a volatile element which was a nuisance rather than a source of strength, and also a return of confidence in the French financial situation, which they welcomed. But there was also an element of speculation which made it advisable to carry out the operation announced in the Treasury minute made early in January. Regarding the provision for the weekly valuation of the assets of the Issue Department of the Bank of England. Sir John Simon recalled that under the present arrangements any profits on the note issue accrued to the Exchequer revenue, while there was no provision for making good any (leficieucv. It seemed the most coincident solution of this difficulty that the exchange equalisation account should receive from the Issue Department an\ profit on the note issue, including appreciation, and should make good any depreciation. The Chancellor also made a statement on the profit, about £90,000,000, resulting from the revaluation of the gold reserves of the Bank of England. "This unrealised capital appreciation could not appropriately be used as revenue, and I am not so proposing to use it,'' he said. ".My proposal is that this sum shall be passed to reserve. It wrll increase the iissets of the exchange equalisation account.'' The bill, which was favourably received by the Opposition, was given its second reading. After passing the Export Guarantee Bill the House rose. VEGETABLE SHIPMENT ARRIVAL IN SYDNEY RELIEVING ACUTE SHORTAGE (Received February 7, 10.15 p.m.) SYDNEY, Feb. 7 A consignment of 4400 bags of onions, 502 bags of cabbages, 62 cases of beans. .'l9 cases of peas, 100 bags of pumpkins and 86 sacks of swedes and turnips, as well as other vegetables arrived in excellent condition from New Zealand on the Wanganella to-day, and will be marketed to-mor-row. These will afford relief in the acute vegetable shortage. However, local reports state that the position in regard to peas and beans, is •becoming easier owing to supplies coming from Tasmania and Queensland. HEMP AND TALLOW LONDON PRICE VARIATIONS The Department of Agriculture has received the following cablegram, dated February :j, from the High Commissioner for New Zealand: Tallow. The market is steady. Present spot quotations are: —Mutton, fine, 24s 6d to 255; good, 21s to 21s (3d; fair, 16s 6d to 17s. Beef: Fine, 20s 6(1;.. to 265; good. 18s; fair, 16s to 16s * 6(1. Mixed; Good, 18s; fair, ]6s to 16s 6d; gut. lis to 15s 6d. ■Mutton: Dark to dull, 15s to 16s Gd. Reel': Dark to dull, lis to 15s fid. Hemp.—Manila". The market is inactive; value for K grade, February to April shipment, being at £'lß ss. Sisal: The market is quiet and slightly easier. Closing quotations. February to April shipment. £l6 7s 6d; sellers. April to June. £l7. The market for New Zealand stocks is nominal and nucha nged. EXPORT FRUIT MARKET QUOTATIONS IN LONDON The following cabled advice on the London fruit market has been received by the Department of Agriculture from tin. High Commissioner for New Zealand : . Apples. —There is a fair demand, principally for the large cooking varieties and coloured dessert. Prices: Washington New tons, 10s to lis; British Columbia, Ms (id. Pears.—There is less demand, and prices are easier. Prices: California!! Winter Nelis, Bs. to lis (3d; Oregon Cornice pears, to 15s. UNSHRINKABLE WOOL NEW PROCESS ON TRIAL LONDON, Feb. 6 A new method of producing unshrinkable wool by using enzymes—completed substances in living cells—is disclosed in the report of the Department of Scientific and Industrial Research. One type suitable for the process is papain, obtained in the milky juice of the pawpaw, the activity of which can be controlled chemically. Apparently the substances specifically act on certain regions of the wool fibre, but it is too early to place reliability on the treatment. SYDNEY WOOL SALES * ALL DESCRIPTIONS FIRM (Received February 7, 8.55 p.m.) SYDNEY, Feb. 7 At the wool sales to-day 10,95(3 bales were offered and 10,030 were sold, as well as 823 privately. The market was very firm for all descriptions, with widespread competition. Greasy Marino made to 24} d per