1938-04-04 — Page 10

For purity

quality

WATSON

ROW

AERATED WATERS

ATTAINING

Jet

the standard of perfection

PERFECTION

BISSET'S

GOLD LABEL WHISKY

SOLE IMPORTERS

OPTORG COMPANY

KAIPING COAL

HOME,

FACTORY

AND

BUNKERS

FOR ALL PURPOSES.

POWER

HOUSE,

TUGS &

LOCOS

THE KAILAN MINING ADMINISTRATION

Head Offices-TIENTSEN.

Agents:-DODWELL & CO., LTD., Hong Kong.

THE CHINA MAIL, APRIL 4, 1938.

The China Mail

Ninety-Third Year of Publication

Fand wages have not offset.

premium

But the question, as regards this greatly stimulated gold pro duction What, if any, has been or wil be its economic effect? is still left open. It is true that, for the time being at any rate, the gold standard has been wide-

SA Wyndham Street, Hong Kong y abandoned. Yet the fact re-

Telephone. 20022.

Loudon Office:

Notice To Contributors. All communications intended for

mains that every great central bank, outside perhaps of the United States, has been labour- ing to strengthen its gold

re-

7, Garrick Street, London, W.C.2serve. The United States Trea- sury, even while "sterilizing” further additions to its gold fund, a policy only recently abandoned, is still buying great amounts at the high price fixed in 1934. Gold is still used in very large quan- tity to equip the various "ex- remit from nation to nation, in change equalization funds" or to

publication should be addressed to the Editor, and be accompanied by the Writer's Name and Address,payment of an adverse trade ba- lance. Facilities for increased cre- not necessarily for insertion but dit, in the world's principal bank-

ing institutions, have been as a guarantee of good faith.

larged, by the increase in re- serves, mostly made possible by the new gold.

Subscription Bates.

3 Months

HK$ 9.09

6 Months---t H.K.$18.00-

One Year.... HK.$36.00

Postage Abroad Extra

Hong Kong, Monday, April 4, 1938.

THE GOLD-OUTPUT PARADOX

Before the war, and before, the

en-

One rarely hears this increas- ing gold output cited, as it used to be, as an essential factor in abundant credit, good prices, and trade activity generally. Yet it can hardly fail to exert some in- finence. In the post-war period as a whole, the economic paradox is that widespread talk of “de- monetizing” gold, of relinquishing the gold standard, of "steriliz ing" incoming gold for its tradi- tional monetary functions, should have been accompanied by a great advance in its market price, by its larger use in settling interna- tional balances, and by a quite unprecedented increase of the world's production.

*

*

utter derangement of currencies King Gustaf

caused by it, a large increase of annual gold production was

re-

cognised as an influence both in An interesting picture publish- sustaining prices and in promoted in the "China Mail" on Friday. ing business activity. It was re- showed King Gustaf of Sweden.

the Carlton Tennis ported recently that as a result watching

of the sudden development of Tournament at Cannes. The real mining in the Philippines, that interest, of course, did not con- American gold production in 1937 sist in that fact as such, but in was in quantity not only 9 per the natural association with it of cent greater than that of 1936, the knowledge that His Majesty, but was 85 per cent above 1933, even today at eighty years of The world's gold production, at age not only watches tennis, but the same time, exceeded 1936 by plays regularly himself, some- 1814 per cent and 1933 by nearly times several sets in an after- noon. Gustaf V will be 81 years 41 per cent.

old on June 15, and that makes This is a very extraordinary his tennis playing, his gadding increase, especially in view of the around and his unfeigned zest fact that, since 1927, a slower but for living remarkable. A king, uninterrupted annual increase even a constitutional one, leads had been in progress. In actual an exacting life. Like a Gov- quantity, no such addition has ernor, he has to appear to be ever been made in so short a time glad to see people when he isn't. to the world's stock of gold. Even He has to eat dinners when he the percentage increase has not isn't hungry and make speeches been surpassed in any four-year when he doesn't feel like talking. period since the Californian and He has to lay cornerstones, launch Australian gold discoveries, near-ships and open bazaars. ly a century ago.

In a

All this

country like Sweden he has to be The recent rapid increase has a model of the domestic and pu- not been accounted for by new blic virtues. He has to be demo- discoveries, as was that of the cratic, yet dignified. Forties and Fifties, or that which takes time and is a strain. accompanied the opening up of King Gustaf has managed it the Transvaal gold fields at the very well, being one of those end of the Nineteenth century.kings who are born with a genius Both Russia and Canada have for kingship. Even without the lately extended their gold-mine constitutional crown he would operations; but a great part of have been distinguished as a hu- the world increase has resulted manitarian, perhaps also as (as in the Philippines) from de-sportsman and an archaeologist. velopment of known gold de- His hale old age would în any case posits previously neglected For be a joy to see. Even the cynic this, the mining market's natur-about monarchs and monarchies al explanation is that the very can take pleasure in thinking of high premium on gold, measured King Gustaf going about so mo- in the depreciated currencies of destly, keeping up his tennis and important States, has made pro- not needing armoured trains or duction highly profitable where it hattalions of infantry to make

was not before. Higher prices him safe.