GOLD RETURNS

Taranaki Daily News, 13 March 1933, Page 7

GOLD RETURNS

hoarders suddenly,act MILLIONS OF DOLLARS FLOW ROOSEVELT’S PROPOSALS VETERANS’ PENSIONS CUT CAALPS FOR WORKDESS MEN By Telegraph—Press Assn.—Copyright. New York, March 10. Gold was hot to-day, sizzling hot. It burped fingers, seared consciences and Stung hoarders into suddqn. action. By thousands all over the United States they scurried to the banks to purge themselves of the yellow stain that the Government had decreed would be a passport to prison. Ip vanity bags, steel chests, trousers pockets and armoured cars it poured in in stacks of dougle eagles and five dollar pieces that dangled on the last Yuletide tree, and in big bars of bullion. The fright which drove much of it into socks and vaults was bringing it back, fright at the prospect of 10 years’ prison and a 10,000 dollar fine. One estimate predicted that 1,000,000,000 dollars of hoarded gold would be back in a few days. It was believed that 200,000,000 dollars was restored to the Federal Reserve system throughout the country this week. Everywhere the Government has prepared a drive to punish hoarders. The Reserves Board has called for the names pf all who have secured gold in the past two years. Gold trinkets and bullion are being exchanged at the assay offices for cash. Some even tendered gold teeth and watches. One man telephoned a New York bank stating that he had 700,000 dollars in gold. “HOLIDAYS” EXTENDED. A Presidential proclamation kept rigid the restrictions clamped tightly to-day about the operations of the United States banks until possibly Saturday. Mr. Roosevelt used the power Congress has just given him by extensive holidays until a further proclamation. This means that for the time being the banks can do only what they have been doing in the last few days—enough business to prevent food shortages and to keep people from going without pay. His second attack on the United States economic crisis finds Mr. Roosevelt calling on Congress for authority to effect a 500,000,000 dollar slash in war veterans’ costs and Government salaries, and his swift developing of his emergency programme brings forward a proposal for a 500,000,000 dollar bond issue to be used in employing approximately 500,000 men in internal improvements. The cut in war veterans’ costs would amount to between 330,000,000 and 400,000,000 dollars from the present annual bill. Senators and members of the House of Representatives have been deluged with’ telegrams of protest from the veterans’ organisations, and a bitter fight looms, but the Democratic leaders express confidence that the President will win out. Without doubt the amount finally issued and put forward as a revivifying monetary transfusion will be more than 2,000,000,000 dollars. The Federal Reserve system will be the agency by which it will be started on its mission of booming business. Mr. Roosevelt asked Congress to-day for authority to reduce the veterans’ compensations and Government salaries, to take effect immediately.

BALANCING OF BUDGET. Pointing to the prospective Treasury deficit this fiscal year of 1,200,000,000 dollars, the President demanded emergency action tor balancing the Budget. “The very stability of the Government itself is concerned,” he told Congress, “and when that is concerned the benefits of some must be subordinated to the needs of all.”

Permanently and totally disabled soldiers will not be touched, or veterans whose disability is traceable to a service origin, but the President will be given full authority to fix the rates of compensation for thousands of other veterans not in these classes but receiving allowances.

The United States Treasury this afternoon began to dispatch numerous telegrams allowing banks to re-open, but no announcement was made as to the names, locations or times.

Mr. Roosevelt had previously signed an executive order making possible the resumption of early banking operations in substantial volume under the close supervision of the Treasury. Under the order the Secretary of the Treasury, Mr. W. Woodin, was given authority to issue licenses to the Federal Reserve member banks to re-open, the applications for licenses to be filed with the district Federal Reserve banks. State banks, not members of the Federal Reserve system are to be allowed to re-open after obtaining approval from the proper State banking authorities. Mr. Roosevelt has virtually ready for submission to Congress a far-flung, unemployment plan for enlisting 500,000 idle men into a civil corps, similar to an army, and placing them in camps in various parts of the country. The Speaker of the House of Representatives, Mr. Rainey, told newspapermen that such a project would be part of the President’s proposal for a 500,000,000 dollars bond issue for public works, probably to be dispatched to Congress on Saturday. Mr. Woodin, Secretary of the Treasury, announced to-day that the 12 Federal Reserve banks would re-open on Saturday. The Washington Reserve Banks are directed to make loans secured by the direct obligations of the Government and to conduct such other business as necessary to make sure of transactions by banks for necessities. This is the first step in the plan for a complete re-open-ing of sound banking institutions. The new money legalised by the Banking Act is being rushed to the banks in various sections of the country to allow them to open.