MONETARY MACHINERY

New Zealand Herald, Volume 81, Issue 24955, 26 July 1944, Page 4

MONETARY MACHINERY

An important advance toward assembling the financial machinery of world trade has been made at conferences first of the experts and then of the Government representatives of the 34 Allied and associated nations. Agreements have been reached on the organisation of an international bank and currency stabilisation fund. .This is an impressive achievement in itself, and a hopeful augury of post-war cooperation. Two points should be noted, however. First, certain troublesome questions have still to be answered, such as the rates of exchange between the various national currencies. Second, the agreements have in most cases to be submitted to the Parliaments of the member countries and to be ratified by their Governments. Supposing these obstacles are eventually overcome, the world will have equipped itself with the machinery of trade, but will still have to provide the material on which the machinery can work. This objection was raised in debates in both Lords and Commons, the objection that to discuss currency before trade was to put the cart before the horse. The Opposition here has offered the same sort of criticism. Certainly it is true, as Lord Bennett contended in the Lords, that there is an inseparable connection between currency on the one hand and tariffs, preferences, import and export controls and the like on the other. But, as Lord Keynes rejoined, "It is perhaps an accident that the monetary proposals got started first and are therefore more fully developed ... As we cannot talk about everything at once, let us talk about these first." Even so, machinery to facilitate the movement of goods will be useless without goods to move.