1935-02-06 — Page 15

THE HONGKONG TELEGRAPH. WEDNESDAY FEBRUARY

· 1985

PREVENTING: DEPRESSION

FRUITS OF TEN YEARS' STUDY

COMMANDEERING FINANCES

Washington, Jan. 28.

A comprehensive plan to pre- vent futuro depressions com- pleted by distinguished fedoral scientist han nlrandy won sympathetic support from bankers, economists, now dealers and congressional quarters,

The scheme was devised by Dr. K. C. Dickinson, of the government Bureau of Standards, after a 10- year study. He plans to submit It to high administration authorl. tion when it is perfected.

Under Dr. Dickinson's plan, most of the new deat projects would be scrapped. In their place would be substituted a new Bacal framework which embodies a modi- fled plan of a contral bank. This, briefly, is the Dickinson plan:

If the Treasury could call upon all banks throughout the nation to turn into the federal coffers all! accumulated deposits which, for! reasons of timidity on the part of Industry, lack of confidence or other causes, are remaining idle. The government would fix and guarantee the interest paymenta ¡ on this mondy which would remain always subject to immediate with- drawal by depositors through their! local banks.

With this vast reservoir of cash reserves, the government would ask all of American industry to increase its production 10 per cent. a year. Federal credit would be made available for this expansion, Dr. Dickinson estimates It would Involve $2,600,000,000 a year. He figures that the industrial budget -production and consumption- could be balanced in two years.

ROOM FOR ALL

Death and destruction come when two trains, Cleveland bound, loaded with Christmas passengers and mail, 'crashed three miles north-east of Delaware, O. thres enginemen being killed and 13 passengers and trainman injured. This picture shows four coaches piled in a tangled mound of wreckage aeroan the tracks at the junction of the main line and the spur from Delaware.

BANKER'S WARNING

TO AMERICANS

U.S. GOVERNMENT WORK

RELIEF ERROR

a

of last summer whero, in spite of possibility of determining at this the terrible conditions which have moment the precise measures which existed, trade has been active and must be adopted to bring about the savings bank and other bank

| desired result, 'or of prophesying at balance have increased.

this time the date upon which that end can be accomplished.

He emphasized the value of the recent rapprochement between bankers and the administration and expressed relief that "this co-opern tion and this attitude of under standing will unquestionably con-

tinue. San Francisco, Jan. 31. Mr. Winthrop W. Aldrich, chairman of the Chase National the nation's biggest bank-delivered luncheon address before the Commonwealth Club of San Francisco in which he sounded a warning against continuing the government's policy of work relief:

Mr. Aldrich and a group of his New York bank as- sociates had completed a tour of the country studying economic conditions. Arriving here they reported find ing "a real upturn in the trend of business and a re- covery from the pessimism which had existed during the summer months."

"Estimates seem to indicate that much as the cost of home relief, work relief costs anywhere from and my own opinion is that ordin- twice as much to four times asarily work relief costs are at least

In saying this, I do not intend to imply that differences of opinion may not still exist nor do I menn to say that, where such differences of opinion do exist, criticism of government policy, will not be ex- pressed in the future."

He said he regretted the govern-

Unemployment relief he sees as the principal abstacle to a balanced budget. But the rellef, he be- leves. should be administered by local agencies which understand the problems involved.

"We are all agreed," he said,

that, in the last analysis, unem- ployment can be brought to an end only through private initiative and the reestablishment of private in- ment devaluation of the dollar, but dustry on a sound and profitable found good in the fixing of gold basis." content of the dollar carly this

the recent removal of year and

change the foreign exchange restrictions as on the assumption that none of his laying the basis for eventual inter-listeners "wishes to national stabilization.

fundamental character of our in- Įstitutions, p that Ave will be obliged to look to the central gov.

BALANCING BUDGET

He based his discussion of relief

"I believe further," he added, ernment to take care of the people

Virtually all of the nation's 10,- 000,000 unemployed. Dr. Dickinson stated, would be absorbed within a year. After stability has re turned, the government would use the money still accumulating In the treasury under the plan, as

three times as much as home relief."that until measures have been under any of the many forms of reserves available for instant use

When, vast public projets are taken by the Federal Government paternalism which have developed in quickening the economic pulse)

which always brings higher prices; volved, as has been the case in which convince the people that thein other parts of the world." when it shows signs of faltering.

This would be done through the Treasury fund would be pro-many of the PWA expenditures, Igovernment is determined to bring

the Dr. am satisfied that

difference the federal budget into balance He indicated that unemployment permanent public works program-fected by a federal sales tax. me. To protect its position in the Dickinson explained his plan calls must run very much higher than there can be no definite certainty might not be a temporary pheno- with regard to government credit, menon, although there were argu- event of another eri of stock for no regimentation of industry this."

"He would take relief out of the and therefore that the confidence ments on both sides. What appear- speculation Auch

existed or the individual. It would be по

gurial legislation anda of the professional welfare necessary for ultininte recovery will ed sure was that it would be some prior

to the depression. the supported by plan. enlls for recommenda- which would care for the aged, workers, eliminate the political be lacking. I appreciate, however, time before it could be sharply tions from the treasury for impost, although Dr. Dickinson feels that phase, and set up a new instrument- the tremendous difficulties with reduced, and hence the relief pro- tion of a tax on capital gains. higher wages which would be paid

which the government is faced in blen was a paramount one.-United Similarly in the event huge with- under his proposal would permit

balancing the budget, and the im-Press. drawals are made to expand and the individual to finance his own Increase the efficiency of industry security.-United Preas.

Qualifying at a bridegroom by winning the London-Melbourse air derby, taxmed with C. W. A. Scott, the British flier, T. Campbell Binck, takes lunchapa with his fiances, Florence Desmond, the actress,

model of a prehistoric monster doesn't foal the cold-

In the Berlin Zoo, nor.

allty in each locality which will study the situation, follow its de- velopment daily and see to it that relief is adequate, and economic- ally administered. ...

"Increased government expendi- ture (involved in the government work relief programme,) through the ordinary channels of trade, based on borrowed money, will in itself have a tendency to make for Increased general business activity, but where the government borrow- ing is on so vasta scale as to ale fears regarding the budg fears regarding the future of the currency, private enterprise hesita-, tes to make long time commitments, hesitates to undertake new ven tures, and the net result is to de press,

rather than to stimulate, private business activities.

"The government's activities in connection with new power develop ments which create a tremendous excess supply of power for which. ino present demand cxists undoubt- edly do give orders to certain of the heavy industries, but fears running through the public utility field as to the extent of the con- sequences of these activities of the government have means an almost total ceasation of orders from the private enterprises in this field to those same industries, and the net result. I have no doubt, is that the heavy Industries are very much less active than they would be if the government had not been in the fold at all.....

HOME RELIEF

"I submit that if we, in this country, concentrate on direct home relief and eliminate work relief as far as possible, the budgets of the municipal, county, state and federal governments can be brought into balance, and that if this is not done wo will soon be faced with a situa- tion the seriousness of which can- not be exaggerated."

On the trip from New York to San

Francisco Mr. Aldrich and his associates visited Chicago, Mil- waukee, St. Paul, Minneapolis, Seattle and Portland. From here they are going to Los Angeles and hack to. Now York by way of Texas and other southern states.

Reporting on lis Andings in the cities visited, the banker said:

BUSINESS SENTIMENT

"Business sentiment as a whole is distinctly better, and I bellave that it might be said truthfully that confidence is rapidly being reestab- lished in those communities, were it not for the fact that there is a fear on the part of many men that the recent incrense in business activity has been caused and sub- tained to too great an extent by the expenditure of government money. This-is-particularly true In the areas affected by the drought

This photo taken in Dublin shortly before their marriage, shows Lady Moira Forbes granddaughter of the late Mr. Ogden 1. Mills, U.3. mining magnato, and Count Louis de Brantas, whom sha wad despite suit instituted on iha era of the ceremony by Princais Nedaida Sharbatov, Russian emigre who named" tha count as father of her child and asked 1,000,000 francs damages,

́do those thick-coated brown bears,

for "sweat"in" any'

NOTICE

WE BEG TO ANNOUNCE THAT WE HAVE REDUCED OUR PRICES BY

20%

Off all Sports Goods, owing to the higher value of the dollar, This will remain. in. force until further notice.

Further reductions will be notified in the event of the dollar further increasing in value.

MAMAK & CO.

SPORTS OUTFITTERS 10, Peking Road, Kowloon.

TAYLOR'S LONDON DRY GIN.

SUPERLATIVE

Sole Agents:———

TAYLORS London Dry GIN

GANDE, PRICE & CO., LTD. St. George's Building, Ice House Street. Tol, No. 20135. Hongkong.

Carton Agent:--

S. LILLICRAP, 72, British Concession,

Canton.

PUALITY

THE

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HONGKONG HOTEL; REPULSE BAY HOTEL; PEAK HOTEL

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ASTOR HOUSE; PALACE HOTEL;

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LIMITED.

In association with the Grand Hotel des Wagons Lits, Paking

Penang

The Scenic Gem of Malaya

Runnymede Hotel

Malaya's Premier Hotel

also under the same management THE CRAG HOTEL Penang Hill

(A health station)

CABLES "RUNNYMEDE". RUNNYMEDE, HOTEL LTD.

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