ECONOMIC CRISIS

Wanganui Chronicle, Volume 74, Issue 115, 18 May 1931, Page 7

ECONOMIC CRISIS

RESTORATION OF SILVER BANK DIRECTOR’S PROPOSAL A SUPER-BANK OF EMPIRE [By Telegraph—Press Association—Copyright] OTTAWA, May 15. Air J. F. Darling [director of the Midland Bank), addressing the Bank ing and Commerce Committee of the House of Commons to-day, suggested that the British Empire should take the lead in a definite programme to restore the value of silver. He expressed the opinion that Canada was in a position to take the leadership. The coming Imperial Conference at Ottawa would be an excellent place to start the restoration, and the Premier (Mr R. B. Bennett) would be an excellent man to initiate the programme. Something had to be done to rescue the world from the economic morass into which it was sinking. Air Darling declared, emphasising the impossibility of carrying the stupendous debts resting on the nations of the British Empire under the existing price levels. The

same was the case with the United States and other nations. The present scales of wages could not be maintained unless something was done to lift the prices of commodities. The great need of the world was higher price levels. Air Darling outlined a scheme con templating the formation uf an Empire Banw which would make possible a bimetallic basis of currency, silver being restored to its place alongside gold with a value ratio of 1 to 20 in favour of gold instead of the existing ratio in which gobi was 70 to SO times as valuable as silver. This would restore to India and other countries using silver currency the wealth purchasing power which they enjoyed before the deflation of their metal. Enhancement of Wealth. The restoration of silver would mean, of course, the immediate enhancement of the wealth of those holding silver, but it would be permanent, enabling these people to purchase with their increased wealth. If the Empire took the lead he thought that all portions of the world using a silver currency would join in the move. He hoped that the United States would join in view of the immense international debts, fchiould silver begin to slip in value compared with gold, it coulc be regulated by the nations accepting debt payments in silver. A big step in the proposal would be the immediate acceptance oi debt payments in silver by the United ' States and Britain. With regard to the proposal for an interuationtl conference, Air Darling said: “Before the conference could meet and work out a remedy, 1 am afraid the ship would be foundcicd.’ Under hjs scheme a super-bank of Empire, to belong tc the Governments of the Empire, would be established in such a way that no single part of the Empire would have control. The bank would act as an automatic adjustment machine between the two metals. The Bank must have something with which to purchase gold and silver. He suggested that the bank have a book keeping unit, which he had termed the rex. Air Darling said that it would require 225,000,000 rex- to take over all the monetary gold in the Empire, Offices of the banks would be established in London, in convenient parts of the Empire, and in India. The bank would purchase gold at the rate of 113 grains per rex. There would be established a fixed price l'o r silver at one-twentieth that of gold. Indication from America. A Washington message says that the Under-Secretary of State (Air Castle) said that the United States was prepared to participate in an international conference to discuss the silver problem. 1