WARNING TO FRANCE

Poverty Bay Herald, Volume LIX, Issue 17918, 24 October 1932, Page 7

WARNING TO FRANCE

“STERN TESTS AHEAD” FINANCIAL PROBLEMS PARIS, August 29. A striking warning to Frenchmen that they must prepare themselves for hard financial tests, was uttered to-day by M. Germain Martin, the Minister of Finance. The Minister declared that the Government was now faced with a most difficult task. It was always unpleasant to have to preach stern economy and sacrifice, but this was what France required at the moment.

It bad frequently been suggested that France might overcome the present difficulties by adopting, to a certain extent, a policy of inflation. This could easily ho clone, since the gold cover of the present bank-note circulation amounted to 76.82 per cent., whereas the law provided that it need be only 35.5 per cent. But, the Minister pointed out, to increase the fiduciary circulation woula simply create a false impression of prosperity. It would mean that the nation, as a whole, was borrowing from the bank. .Money that was borrowed had, sooner or later, to be repaid. He therefore made it perfectly clear that the Government would have nothing to do with inflation, and proceeded to warn the nation that there could be no question of postponement of existing difficulties. These would be met and overcome by general sacrifices in the immediate future.

Tu closing bis combined warning and appeal, the Minister emphasised tho courageous manner in which the British people bad faced their financial problems.