INTERNATIONAL: Gold Over Europe

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Their danders up, some of Manhattan's biggest bankers let newshawks know that Depositor France could withdraw her gold and welcome (i. e. and be damned). Straightway two things significantly did not happen : the Bank of France and other European interests with large balances in Wall Street not only made no large withdrawals but drew less U. S. gold by earmark and shipment last week than for any similar period during the month ; secondly, Manhattan banks did not up their interest rate but continued to pay only 1½% to the Bank of France which continued to take it.

Gold Hoarders. Nervous Poles, who have hoarded U. S. banknotes, recently exchanged them by the million in unreasoning panic for Polish banknotes. Not exactly pleased with themselves, the Poles next took a tip from Frenchmen, began buying U. S. gold pieces. Last week this trend made Polish bankers simply wild.

They had been eager, fortnight ago, to give Polish zlotys in exchange for dollar bills. But they winced last week at supplying dollar gold pieces in exchange for paper zloty. All this gold, declared the Bankers' Association of Poland in a manifesto to the public, was becoming "sterilized" in Polish pockets, socks and safety deposit boxes—a dreadful thing to have happen. When Poles continued doggedly to buy and hoard gold, the Bankers' Association warned Finance Minister Jan Pilsudski (brother of Dictator Josef) that there was but one thing to do: the State must ban gold imports into Poland by any individual or bank except the Bank of Poland.

Roman Jubilee. Eighty fat barrels full of U. S. gold ($22,000,000) made Romans jubilate last week. Where they came from interested Wall Street. No gold shipment of such size has cleared from the U. S. for Italy this year. Smug, the Bank of Italy (having probably obtained its U. S. gold via France) would admit only that Italy had got it, would use the precious stuff to keep her lira on the Gold Standard.

Europeans know this: many nations remain on the Gold Standard but only the U. S. will promptly give in exchange for its paper money gold coins. France mints no new gold; Great Britain minted none after the War (even while her pound was on the Gold Standard); Germany mints no gold marks. In France the state bank is obliged by law to give gold in exchange for paper only in the awkward form of gold bars weighing 25 Ib. each, costing $8,700. Private European banks traffic in gold coins at a premium as in Poland.

Canadian Silver Racket. Canada's paper dollars sagged to 86¢ each after the fall of the pound sterling, but Canadian silver dollars have continued exchangeable at face value for U. S. silver dollars in U. S. towns along the Canadian border.

Suddenly last week many a U. S. border storekeeper noticed that his till had become overloaded with Canadian silver, cursed his own stupidity. Shrewd border farmers, it appeared, have been working an ingenious rural silver racket thus:

Go to a U. S. bank and get a Canadian paper dollar for 86¢.

Cross into Canada with this paper, exchange it for a Canadian silver dollar, come home.

Buy a U. S. dollar's worth of goods at the corner store, paying for it with your Canadian silver dollar.

Net profit on each dollar wangled in this way: 14¢.