GOLD RESERVES

Timaru Herald, Volume CXXXVII, Issue 19642, 9 November 1933, Page 6

GOLD RESERVES

THE TRANSFER PRICE. By Telegraph— Press Association WELLINGTON, November 8. The Rt. Hon. J. G. Coates in a statement to-night, said that the comments on the Reserve Bank Bill ascribed to Mr H. Jenkins, of Wanganui, were wide of the mark In their main points. Nobody had disputed the fact that, subject to banking law, the gold coin in the possession of the banks was “owned” by the banks. Equally beyond dispute was the fact that when any country established a Central Reserve Bank Its gold coin must be concentrated. The only question was the price at which the monetary gold should be transferred, and this was answered by the abundant evidence—not so far challenged—which showed that the book value of the gold (in banks’ own books) was the proper value for the purpose of transfer. It was suggested that a distinction should be drawn between further gold needed to redeem the notes and the so-called "non monetary gold reserves.” The answer was that all of the gold was held as monetary reserves. Were it not for the artffiefal measures which established the inconvertibility of notes, the holders of notes could call for gold and no less important, any bank customer with an account to his credit could draw a cheque and obtain notes and then could present the notes and demand gold. The distinction which Mr Jenkins sought to draw was not one of any substance.

Dyes lor all purposes.