1949-09-21 — Page 9

THE CHINA MAIL, WEDNESDAY, SEPTEMBER 21, 1949,

WORLD'S CURRENCIES CONFUSION, Pound Selling Over BRAATHENS

HOPE, FEAR The Official Rate

FOLLOWING STERLING IN THE UK

Lower Rates Fixed By Many Countries BOOM IN GOLD SHARES

London, September 19.

The most obvious financial result of the new Sterling rate was the boom in gold shares-notably in London, South Africa and Pa New Zealand.

In Johannesburg the change was hailed with satisfaction by the gold mining

industry as a much needed relief.

But some Washington officials Į warned that the automatic price reductions of British exports to the United States would not by it- self mean

great immediate boost

in

Fixed Price

ernment statement,

Switzerland: The Swiss Federal Council today told the British Government that the present gold parity will be maintained despite Sterling devaluation.

Earlier in the day all foreign

business between exchange

the the Swiss franc, Sterling and French frane was suspended.

London, September 19.

of basic

Com

A wide range modify stocks boomed today in the first frantic reaction to Pound devaluation and the world monetary shake-up.

White commer folk feared harder times, brokers rushed te buy shares in commodities the world always needs-ubber, tin. cotton, copper-and in specula- tive gold, hoping to safeguard their devalued money,

There was hope, tear and con- fusion in hames and Government and financial quarters through- out Europe, Asia and Africa.

Pressure continued for wage increases---which Sir Stafford Cripps has ruled out, arguing they would raise production costs in Britain and therefore raise the price of export commodities that must bring Britain dollars.

workers

Juid-

New York, September 19.

The Pound Sterling on the foreign exchange market hers today sold at $2.82-2 cents above the official exchange Agure for immediate delivery..

Dealings in the, early afternoon reflected unusually heavy commercial - buying of Sterling,

in later dealings holders of Sterling were asking four cents over the official rate, and bids wers $283-thres cents above the rate.

It was the first time in years that such a premium was ever paid above the official spot Sterling parity.

In recent years deliveries occasionally obtained a premium of 1/8th of a cent at the most above the official rate.

Today's strong demand seemed largely because of insuffi cient holdings. Same United States buying commitments which have been shelved for many months until the announcement of devaluation were also responsible.

actual

There was no official comment in banking circles.. The unofficial bellet was that the premium would be short. Ilved.--Reuter.

WILD SCENES

IN THE CITY:

RUSH FOR GOLD

"The cost of living can be ex- pected to rise by six or seven per First indications on British export prospects came from Canada, where it

cent in the near future," said the was widely predicted that British goods might undercut the home market.

Shop Stewards' Council of the Responsible sources here be 1 All banks have suspended ex-Engineering and Allied Trades, Leved that Dr. Cereijo may have change cperations periding a Gov-representing 3,000,000

who want another Pound a week. been misunderstood.

Landon railwaymen tonight A voted to "go slow" from night on Wednesday to press a demand by their union--the 450,-

Union 000-strong, National Railwaymen for an overall 10 shillings a week waze rise.

The decision.

which was taken at a meeting of delegates representing 100,000 Londer and surburban railwaymen is the first workers' reaction to the "work harder for the same pay" appeal by the Chancellor of the Exchequer.

The Economie Minister, Dr.

Roberto Ares, told reporters tha:

The Swiss Bourse was expected to set a new rate for the Swiss irane of 12.05 to the Found 'com-.

pared with last week's official rate

While the prices of other sales. In Japan, sources in the Econo- Argentine products shipped to

Britain are subject to negotia mic

which Stabilisation Board,

tion, this does not apply to meat. plans Japanese economic policy,

they said, since the price for the predicted that devaluation would

first year was fixed in the pact. speed the conclusion of long

Further, the gold guarantee protracted Sterling trade talks-by encouraging Sterling Area exports clause in the pact applied only to Sterling balances held by the ic Japan.

Swiss Government circles ex-Argentine Central Bank. pressed optimism at the probable

17.35. results

of Britain's step, believing

Swiss Government circles that while it would help the Sterl prices of Argentine goods for Bri- ing Area it would not seriously tain would be adjusted in direct thought Switzerland's exports to proportion to the devaluation of Britain-mostly high-grade goods affect Swiss exports to Britain.

Reuter

would not be sericusly affected dispatches

the Sterling. gave

Germany:-The new West Ger-by the change in Sterling. following picture of world roac-

man Govertiment at Benn will dis- tion to the new Sterling rate:

Tourist Trade cuss the devaluation question at Argentina:-A

report newspaper "La Nacion" that Brits next meeting.

These circles

uncertain of West The Central Council tain would have to pat 30 per

whether or not they would lose cent more for Argentine meat was German banks will also meet to

more than 30 per cent of the not confirmed in usually well-consider the

the position.

still owed by Western - licensed

newspapers £15.000.000 loan informed circles tonight.

Britain. The newspaper had quoted the saw devaluation as an unpopular President of the National Econo-but highly necessary step and all mic Council, Dr. Ramon Jose agreed that the West-mark could Cereijo.

Le expected to follow shortly.

in

The

He said, according to the report, that under the terms of the recent Anglo-Argentina trade pact prices

Financial circles in Berlin be- lieve that the West-mark would be devalued to a rate of between 4.20

of meat and other Argentine pro-and 4.30 to $1. The dollar stood ducts for Britain must be re- adjusted.

COMMONS MAY BE RECALLED

circles

at 6.50 marks in Hamburg today.

Dutch To Follow Spain: Financial

said that Spain was interested in first watching what other countries would do about devaluation, but an announcement on her new atti- tude was expected later today.

were

At the time of the loan the

+

DX

· London, September 19. shouting mass of stock-brokers and speculators' buying gold shares in an unofficial street mar- ket following devaluation of the Pound Steri- ing blocked roads in the Stock Exchange area today.

The Stock Exchange was closed by order of the Treasury but financiers flocked all morning to the streets outside to cash in on unofficial deals in gold shares.

who had One broker alone, Fortunes were made in minutes { amid the craziest scenes witness-been steadily accumulating gold ed in the financial hub of the City shares over the past year in the since before the war.

hope of devaluation. was known

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The decision will be one the important factors before the

Shouting jobbers added tens of to have made a pront of hun- General Council of the 8,000,000-

pounds Union

Congress millions of pounds to the marketdreds of thousands strong Trades when it meets here tomorrow to value of gold mining, industrial Sterling-Reuter and Associated consider the economic situation in and oil shares. the light of the revaluation of the Pound.

21/9

28/9

of

2/10

Press.

5/10

12/10

Two thousand brokers, jobbers and clerks shouted prices the length of Throgmorton Street. The noise was terrist.

16/10

19/10

22/10

26/10

Rubber prices in London today Swiss asked for a devaluation jumped to their highest levels for clause but this was refused. almost a year. Prices were ove

But it was thought that Ster-28. per pound higher than the

Free State Gedulds jumped 15 land devaluation would have a pre-devaluation levels.

shillings. Ashantis jumped 10/9d disastrous effect on the

After an initial uncertainty. Ventersposts

jumped 11d.

COUTS-

try's British tourist trade, and prices followed the trend of those Anglo-Iranian Ol went up 11/- it was expected that Switzer-

erin Singapore, and this afternoon | solid. land would ask for a review of the October-December delivery.

in

THE WAY OPEN FOR TRADING

Washington, September 19,

The Marshall Plan Administra-

an Anglo-Swiss trade agree-Grade 1, rubber was quoted at Rubber and tin also shot up. ment which allowed a maxi-, 13-3/84 per pound

No unofficial dealings were re-tor, Mr. Paul Hoffman, said to- against 11- mum of £4.600,000 for British 1/4d at the close of the market parted in gilt-edged securities, tourists" expenditure

the on Friday. country in the 12 months be in Singaporer at the epering-of ginning last May.

business

DEPARTURES

23/9

30/9

4/10

7/10

14/10

18/10

21/10.

24/10

28/10

For Passage & Freigh Bookings Apply to:-

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United States-American offi-

creases in

The Financial Times" today. rubber prices was complied unofficially

et between 44 and 45 corts per. und compared with about 37 on Saturday.

day that the round of carency devaluations, started by Britain,

Agents:

Index "after

has cleared the way for Europe Hong Kong & Shanghai Book Bldg, to revive her trade and attain

Tel: *34177-#

the

9

middle of 1952.

~ Devaluation of Sterling - gave frials forpeast still greater in- Jumped eight cents. Selling wis ja check of street sales; 110.1; 02 full economic recovery by

Spain an opportunity for devalu- ing the peseta "gracefuly" if she wanted to, they added.

overseas travel by American tourists as a result of

devaluation,

All foreign currency transac-

The Wall Street Journal declar tions, except in dollars, Swiss ed that globe trotting at a 30% London, September 19.

Portuguese escudos, per cent discount should prove Mr. Winston Churchill, leader francs and of the Conservatives, and the were suspended today until fur, attractive.

On the New York Stock Ex ther, notice Liberal leader, Mr. Clenten:

Holland: The Dutch Cabinet change, Sterling devaluation was Davies, today both urged an decided its attitude at a long meet-marked by an opening burst of immediate recall of Parliament ing this morning, after a statement selling before trading slowed to a to discuss the situation result- last night that it felt itself com-route industrial side, foreign ing from last night's devalua-pelled to take the same or similar;

currency devaluations were ex- tion of Sterling.

steps as Britain

pected-to-reduce drastically all demands for United States cop- per, lead and zinc.

oficial earnest

The Prime Minister, Mr. Cle ment Attlee, is not expected to -decide on-his answer before the

week; but end of the

indicated that quarters consideration

cration would be given t the Opposition leaders request,

Recovering from the first shock at last night's sweeping devalua- tion, British trade unionists and industrialists planned their next

moves.

Both the General Council of the Trade Union Congress and the National Union of Manufacturers' Administrative Committee are to! meet tomorrow to discuss new situation

the

Immediately after presenting. his budget tomorrow afternoon, Peiter the Finance Minister, Leftinck, will make a statement to the Second Chamber, and in- the evening he will broadcast. Ia Amsterdam it was learned today that the Stock Exchange there would res

would resume normal work

Cheaper Cars"

The American press gave front- page prominence to the devalua- tion news.

An important New York dealer in British motor-cars cut prices We Netherlands Federation of 20 per cent following devaluation The cut was made by Fergus Trades Unions, N.V.V., urged the Cabinet today to prohibit price-Motors in anticipation of a reduc- raising without oficial permission tion by manufacturers by that

A leading Singapore broker told Reuter the expectations were that the devaluation of the Pound

pront

would

The

operate

trade's to the

Fortunes Made

Air. Hoffman told a news con- Gold shares were hoisted as ference the devaluation measures much as 53 per cent over pre- had broken the economic log- devaluation levels.

jam that was preventing Euro- pean recovery. It Britain failed Randfontein, one of the corn- panies expected to benefit most to act, he said, the world would Singapore Government from the higher Sterling gold have fallen into three warring to 273. 9d from trade blocs the Soviet group, had not yet made any formal an- price, soared

the dollar group and sterling. nouncement on devaluatios, but Friday's level of only 17s. banks in Singapore were closed West Wits jumped by 12s. 98. to one was expected shortly. All Among higher-priced shares,

today.-Associated Press. and 70s, and Consolidated Goldfelds Reuter.

went up to 755, an--increase of

APPOINTMENTS

“IN GERMANY

Frankfurt, September 13. Mr. John J. McCloy, United States High Commissioner

30

12s.

DEATH OF SCOTS MAGNATE

Edinburgh, September 19.

the

"In my opinion, this would have been the greatest selback European

recovery programme could have suffered since only a united Western world can hope to achieve permanent recovery in Europe."

Hoffman made his optim

istic forecast to the trade union delegation from Denmark, which was one of the countries which Germany, today announced that 68, former Lord Provost of Edin-Britain

Sir William J. Thomson, aged devaluated their currencies with he has appointed Major-Gene-albugh and Chairman and Manag- Commissioner, George P. Hays, as Deputy High ing Director of the Scottish Motor

and Mr. Benjamin Buttenwieser, as Assistant Traction Company, died today.

British tourists in Holland have much.

The British Singer was reduced so far found little difficulty.

Banks were-interpreting their trom $2.150 to $1.650, the Van-High Commissioner. currency instructions liberally to guard from $2,350 to $1,850 and Triumph from $4,150 to the help visitors.

$3.500. Syrians Not Affected Most dealers in British cars

Syrian

Mr. Davies, after a meeting of the Parliamentary Liberal Party

Finance expected to increase sales Committee tod

Syria: The today,

wrote to the

an Minister announced today that the tantially. Prime Minister asking for immediate recall of Parliament devaluation of the Pound Sterling There was

1

subs-

no immediate an- to discuss the devaluation of the did not entail the devaluation of nouncement of reductions in the Pound and the Government's the Syrian currency, which was lower-priced British cars. proposal for a permanent solution (based on gold. of the economic crisis. +

Brazil was understood here.

The new rate for Sterling be-that the President of the Republic,

Parliament is not due to meet comes 613 Syrian piastres instead again until October 18-Reuter. of the previous 883,

It is prudent to insure rather than to take

chance it will never happen to you:

General Enrico Gaspar Dutra, would meet the Finance Minister, Manoel G. Da Silveira Filho, who is also President of the National Bank, to discuss the new relation- ship between the crauzeiro and the Pound Sterling.

(Continued on Page 11

He belleves the devaluation move will break down existing trade barriers and start a freer flow of goods inside Europe. "The greater the "freedom of those goods, the movement of more successful will be the Mar- in shall Plan of aid to Europe," he

said.-United Press

He built up the company in To accept this post, Mr. But 1905. He sold his transport busi- tenwieser resigned his partnership Eess for more than £10,000,000 the Government in the New York banking firm of in 1949 when

transportation Kuhn, Leeb and Company.-Reu-nationalised

Britain. Associated Press.

ter.

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