THE GOLD STANDARD

Southland Times, Issue 19539, 1 May 1925, Page 5

THE GOLD STANDARD

PROVISIONS OF THE BILL RIGHTS OF THE BANK OF JENGLAND OLD REGULATIONS REPEALED. (By Telegraph.— Press Assn.—Copyright.) (Australian and N.Z. Cable Association.) LONDON, April 30. (Received April 30, 11 p.m.). Gold is quoted at £4 4/114 per fine ounce. This is equivalent to £3 17/10$, which will be the Bank of England’s statutory' selling price under the Gold Standard Bill. This measure repeals the sub-section of the previous Act, under which the holder of a currency note was entitled to obtain gold payment at its face value. It repeals the regulations under which any person was entitled to have gold bullion minted, but makes an exception in the case of the Bank of England. Nevertheless it enforces on the Bank of England the responsibility for redeeming legal tender on request in the form of bars of gold bullion approximately 400 ounces. Finally, it empowers the Treasury, on any conditions it thinks fit, to raise any money necessary to exchange operations, provided such loans or credits are redeemed within two years. POSITION IN AUSTRALIA. “A MATTER FOR CONGRATULATION.” SMALL DEMAND FOR GOLD. SYDNEY, April 30. Following the announcement of the return to the gold standard, an informal meeting of representatives of the Associated Banks was held to discuss the position. A formal meeting has been called in Melbourne for to-day or to-morrow to further consider the situation. It is anticipated that one outcome will be a considerable alteration in the exchange rates an an early date. Though it was known that the Commonwealth Bank Board had advised the Federal Government to remove all restrictions on the export of gold as from May 1, the decision of the Government to fall into line with the British Government as from yesterday came somewhat as a surprise to the bankers.

Some demand was made at the banks yesterday for gold for notes, but it was not large.

The Sydney Morning Herald states: — “The return to gold is a matter for congratulation. We now enjoy a stable currency and exchange, which will fluctuate only slightly more than before the war. Certainly the health of the commerce of the world should improve. It will be possible now to take a long view in commerce and to prepare for future developments, and not to be forced to be content

with the subsistence of the month. A rectification of the exchange rates should be announced before the week closes.” Bankers and business men generally express satisfaction at the return to the Gold Standard.

Mr Bruce has requested the Associated Banks to use as little gold as possible and continue business with paper currency, a request in which bankers concur. It is considered likely that there will be a temporary demand for gold currency, chiefly by people who want to again experience the novelty of handling sovereigns, but the great bulk of business will continue to be done on a paper basis. AN IMPORTANT CHANGE. “EPOCH-MAKING EVENT.” REFERENCE BY SIR JOSEPH WARD. At the official opening of the Ohai Railway Board’s new line at Ohai yesterday afternoon Sir Joseph Ward, who was one of the speakers for the occasion, made some interesting references to the Britsh Government’s decision to revert to the gold standard basis.

“Possibly you may not all realise,” he said, “the effect of a cable message published in the papers this morning relating to the action of the Chancellor of the Exchequer in Britain having brought into operation once more the gold standard which has been suspended since 1914 when that abominable and uncalled for war went on for so long. The introduction of the gold standard not only in the Mother Country but in all important parts of the Empire will mean that the people in the Dominion will get increased value for their grain, wool and stock as a result of the reduction in the excessive rates of exchange which have been in operation for some years. I hope that as a result of this action we will not have sovereigns again in circulation in the ordinary way but if we can get a large number of millions sterling sent from this country and owners can get their money back without being murdered by the high rates of exchange we will all get better returns. Not only is this an epoch-making day so far as the district is concerned in the opening of the railway in your district but it is an epoch-making one all over the world because we are to get a big reduction in our rates of exchange.”