STABLE DOLLAR.

Star (Christchurch), Volume LXVI, Issue 20483, 8 December 1934, Page 23

STABLE DOLLAR.

No Further Action Likely! in U.S.A. EYE ON INFLATIONISTS. (By PAUL MALLON.) WASHINGTON, October 28. President Roosevelt does not tell all he knows in his speeches. Nor does he make his most effective speeches m public. That was evident at the recent Bank- - ers’ Convention. The bankers came to town intent on insisting upon Budget balancing and dollar stabilisation. In their resolution, adopted a few days*, later, they were just as strong as ever for Budget balancing, but the soft pedal was applied to stabilisation. It was not even mentioned directly. The reason for that certainly could not be found in Mr Roosevelt’s public speech. He made no promises of stabilisation. Certainly something must have happened on the side-lines to put the stabilisation issue in the background. There is reason to believe that he, or those competent to speak for him, did give the bankers a better private explanation of the money situation than they had when they came. The common sense of the monetary situation might be thumb-nailed as follows: The dollar is stabilised now in fact. It has been stabilised on a gold standard at this level since last January. The stabilisation is what lawyers would call de facto. The only monetary uncertainty is purely psychological; that is, some people fear that this stabilisation will be changed some day. Closing the Door. What the Conservatives have been wanting is stabilisation de jure. That is a complicated way of saying that they want irretrievable stabilisation by law. The only way that would differ from the one we have is that it would close the door to any future monetary action. Some of Mr Roosevelt’s Conservative advisers believe that kind of stabilisation would not be stabilisation at all. Look at England and France. England is supposed to have an unstable currency, but the pound has been stable in fact since the first of the year. France has legal stabilisation, yet the franc in fact has been less stable than the pound. In other words, the de facto stabilisation in the United States and Britain has afforded at least stable currencies in the last nine months as de jure stabilisation in France. A bigger point is that Mr Roosevelt’s political advisers believe that he would play directly into the hands of inflationists and soldier bonusites if he announced de jure stabilisation now. This is the usual time of the year for the inflationists to start building publicity bonfires under the White House. They will probably have a bigger majority in the next Congress than they had in the last one. If the door were shut in their faces, they might very well take the situation out of Mr Roosevelt’s hands by a two-thirds vote. At least the Congressional end of monetary uncertainty would in no way be appeased by stabilisation, but might be enraged.—N.A.N.A. Copyright.