MONEY PROBLEM

Taranaki Daily News, 12 August 1932, Page 7

MONEY PROBLEM

OTTAWA ADOPTS POLICY

RAISING OF price levels CHEAT’ MONEY A NECESSITY EXCHANGE STABILISATION co-operation: by nations By Wtfiaph— Pmm Awn.— Copyrisd»L . Ottawa, Aug. 10. Th« monetary nub-committee’s report vm adopted this afternoon by the main •ommittea at the Imperial Conference M follows:--',(1) It is desirable to raise the general •level of wholesale prices. tt) The beet plan would he the raising \ *f goM prices. This can be done only by international action. ’(«) The monetary factor ' alone responsible for the fall m prices. Other factors, including the political, had had an effect, notably reparations, which were “being dealt with elsewhere but were beyond the wope of the Ottawa Conference. '(4) The British Commonwealths ‘ ‘ monetary policy should be on ' .ound lines towards raising price levels by low interest rates and a plentiful supply of short-term money. This should not take the form of financing public expenditure .but should be directed towards stimulating industry and J reviving confidence in business. . ■ ; !(5) Efforts should her made to atabilisa exchange between the various countries. («) Th« committee refrains from proposing any machinery for this purpose, but merely suggests that there should be co-operation be- •' tween the countries. (7) It also advocates international co-operation to this end. («) The stability of international' ex-changes-can best be obtained by i ,* metallic base to currency. ■ GOLD base not mentioned.

While *ome of the expert® on the subcommittee have expressed definite views on gold as the only sound base the report refrains from expressing an opinion on this subject in view of the world conference which is to be held shortly. Mr. S. M. Bruce and Mr. J. G. Coates were occupied for the greater part of the day on the currency committee, and therefore no time was spent in contact with the British delegates, .but the negotiations are being resumed to-morrow with the prospect of an early agreement. Mr. Bruce substantially approves the currency declaration, in the compilation »f which Mr. IF. (Phillips, Undef-Secre-;ary of the British Treasury, Sir Henry 5-trakosch, Sir George Schuster and Mr. [/, Melville played a prominent part. It is unlikely that the introductory ipeech.es of the Dominion’s leaders at the first currency session will 'be published simultaneously with the report because they might divert attention from the importance of the actual findings, which represent the Empire’s financial policy formulated at Ottawa. Th# report, which ie the Empire’s financial pronouncement to the world, might at first reading bo regarded as innocuous; nevertheless it has tremendous import. English and Dominion bankers and economists have drawn up the report after most mature consideration. Messrs Neville Chamberlain, H. H. Stevene, S. M. Bruce and J. G. Coates were among the members, of the committee which 1 * to-day agreed upon the policy. This represents the utmost Britain can say or do. The Dominions, particularly India, take the view that the Ottawa Conference should have gone slightly further, indicating the fixed poncy for at least a year and giving a sense of stability.