INFLATION PLAN

Taranaki Daily News, 1 May 1933, Page 7

INFLATION PLAN

BILL PASSED BY SENATE WIDE POWER FOR PRESIDENT , DEBT PAYMENT IN SILVER STOCK WILDLY FLUCTUATES DOLLAR PRICE TUMBLES By Telegraph—Press Assn.—Copyright. Rec. 6.30 p.m. Washington, April 29. Defying both the Republican and interparty opposition the Democratic leadership in the Senate to-day forced through the Administration’s inflation measure, including provision for the payment of up to £40,000,000 of war debts in silver, by a large majority, and with equal decisiveness defeated a proposal to pay the bonus in inflated currency. It then passed the Farm Bill, to which inflation was an amendment.

The passing of the Farm Bill came after three weeks’ comprehensive debate on an amendment to the inflation plan to increase from £20,000,000 to £40,000,000 the amount Mr. Roosevelt may accept in silver at 60 cents an ounce in the next six months on war debts accepted.

The legislation was the most sweeping in character ever to go through Congress, although the action under nearly all the provisions is discretionary with the Administration. The Farm Bill vests extensive permissive powers in the President to extend America’s credit and currency by at least £1,200,000,000, and places equally broad authority in the Agricultural Department to raise further the prices of basic farm commodities through the levying of taxes and licensing fees and through marketing agreements and controlled production. New York markets responded to the passage of the inflation and farm measures with wild price fluctuations in the brief space of the half-day market today. Stocks, commodities and speculative bonds soared and the dollar and gilt-edged obligations tumbled. The volume of stock trading was 3,389,000 shares—the largest for any Saturday in three years. Prices closed at the very top, the gains ranging from two to six points. Wheat at Chicago was up 5 5-8 cents and other commodities in various markets of the country took a similar course. The dollar slumped severely, losing six cents against sterling, 110 points against the German mark, 170 against the Dutch guilder and 16 to 75 points against other currencies. The pound closed six cents up on Saturday at 385 J, after touching the high level of 387.

Senator W. E. Borah in an address on war debts asserted that Britain and France seemed to be going forward in a determined effort to manipulate the currency so as to gain a decided advantage over the United States in trade. Mr. Bennett and Mr. Roosevelt announced to-day an understanding on their purposes in economic improvement. They also stated that they had agreed to begin a search for means to increase the exchange of commodities between the two countries. They declared it imperative that as soon as practicable the international monetary standard should be restored. An improvement in silver prices was also under consideration.