May 20, 1933 - Editorial - The Real Gold Problem, by George Lorimer

The outturn of new gold in 1932 exceeded the equivalent of a half a billion dollars - a record. Addition to gold stocks from hoarding, in the British Empire, amounted to $350,000,000. Gold used in the arts and industries fell to less than $70,000,000. In sum, this represents an addition to the world's monetary gold of more than $700,000,000. At this rate, the monetary gold of the world exceeded $12 billion at the close of the year, and this ought to increase annually, for a number of years, at the rate of half a billion a year.

The real problem of the world in not so much to get more gold, though additions to the store of it help, as to use properly and effectively the gold we have. Gold ought to be withdrawn from use of coin and probably will be. It should be used as metallic backing for paper currency and issue of credit, in the hands of central banks of issue; and for transfer in settlement of international trade balances, again in the hands of central banks. (pg. 22)

Comment: This again shows that there was plenty of gold to back the dollar at this time.

Back to Old Weekly Press Table of Contents