AMERICAN PLAN IN OPERATION

Timaru Herald, Volume CXXXVII, Issue 19672, 14 December 1933, Page 9

AMERICAN PLAN IN OPERATION

GROWING DEMANDS FOR INFLATION INFLUENTIAL SUPPORT OF PRESIDENT United Press Association—By Electric Tel “graph—Copyright 'Received December 13, 7.30 p.m.) WASHINGTON, December 12. Consideration of the Federal Budget for the fiscal year of 1935 is attracting much attention in view of the reassembling of Congress in less than a month hence. Conference of Leaders. President Roosevelt conferred with his fiscal advisers to-day, including Mr Henry Morganthau junr. (Undersecretary to the Treasury), and the •Budget Director (Mr Douglas). It is understood that their chief concern is to bring the so-called ordinary budget into balance, and at the same time keep the extraordinary expenditures (that is emergency and relief expenditures) within reason. It is understood that Mr Douglas wishes to keep the ordinary budget of 2,600,000,000 dollars, with anticipated revenues of about 3,500,000,000 dollars, hoping the excess will adequately provide for interest charges on the public debt, including additional borrowing necessary for works, crop loans, etc. It is universally recognised that the success or failure of such aims will be an important factor in the inflation controversy, as failure to maintain the Government’s credit will be regarded as a sure path to inflation.

INFLATION FIGHT INTENSIFIED. ADEQUATE GOLD RESERVES AVAILABLE. Unlied Press Association—By tinvini Telegraph—Copyright (Received December 13, 11.40 p.m.) WASHINGTON, December 13. While the inflation debate continues to absorb statesmen and economists, the United States Federal Reserve figures disclose that on Tuesday the system had sufficient gold resources to increase the currency in circulation by more than 50 per cent, without resorting to any inflationary measure. It was described as ready to do this as rapidly as the new note issue could be pushed into the channels of industry and commerce. The difficulty is that outlets are clogged. Loans by member banks are shown to be continuing at a low level with consequent small demands by the latter upon the Federal Reserve Bank for cash and member bank deposits were high. By utilising all the eligible resources the Federal Reserve figures showed that it could issue nearly three billion dollars in new Federal Reserve notes, every dollar of which would have a gold backing of 40 per cent, required by law. CONTROLLED INDUSTRY. AMERICA’S REVOLUTIONARY PLANS. Uniieu cess Association—By Electric Telegraph—Copyright CHICAGO, December 12. The controlled profit system “as a proper rewtird for individual initiaI live in industry and thrift” must be maintained if the Government’s rej covery programme is to succeed, Mr I Peak told the American Farm Bureau Federation to-day. He said: “The great apprehension in the minds of many business men about the relations of the Government to business” is unwarranted, because “the Government has more hay down now than it will get up before it rains. I believe under any system a Government and individual effort must be encouraged, and the property rights of individuals protcct- | ed.” GOLD PRICES IN U.S.A. DISTURBING LEAKAGE OF INFORMATION. United Press Association—By Electric Telegraph—Copyright WASHINGTON, December 12. I The gold price was unchanged, and was 1.76 above the London price on . the basis of sterling, opening at 5.101. J The persistence with which the I American Treasury figure is being made available in London before it is published here, continues to puzzle the authorities. Reports of stabilisation, conferences I between Britain, France and the ; United States are denied by the j Treasury. The dollar rose in value against j foreign exchanges to-day, and against 1 j the franc and sterling, which both ; fell. ■ I Commodities fell, and the prices of 1 stocks and bonds were irregular.