Money, Money, Money

Foreign exchange was mysterious business even when the dollar was a dollar and the mark a mark. Today, what with the sum total of the world's defaults, devaluations, regulations, restrictions, registrations, quotas, permits, impounded balances, standstill agreements, stabilization funds or the lack of them, money-changing is a nightmare. Foreign exchange traders are probably the coolest, shrewdest, most tireless and nimble-witted crew in the world, but the Paris correspondent of the New York Times last week declared: "The extraordinarily complicated character of the present situation seems to have discouraged even the most hardened speculators."

A few of last week's complications could be perceived without the use of a slide rule. The pound suddenly slumped 5-c- to $4.91 1/2--lowest level since last February. Up went the London gold price to a historical high of 142 shillings 4 pence (about $34.95) Down went, the Scandinavian and other currencies which are linked to sterling through the economics of world trade. Down went the yen, so that Japanese exporters would not lose the markets they have lately gained. And when the international debate about the future of sterling grew raucous, Chancellor of the Exchequer Neville Chamberlain either lied in his teeth or confirmed the world's worst fears when he said, in effect, that old England gave not a tinker's dam what the value of sterling might be in dollars. Hope of stabilizing the world's currencies in the near future was stifled.

That meant that France, Holland, Belgium and Switzerland must rally to a last desperate defense of their gold standards. Their first stand came quickly--when Liege, fourth city of Belgium, suddenly defaulted on its debts. The Government promptly stepped to its aid but pressure on the Belga spread to other gold-bloc currencies, and for the first time in two months the dollar rose to parity with the franc.

The beginning of their last stand may well come next week, when the gold-bloc countries confer at Brussels on their monetary future. With their export markets fast slipping away to the lands of cheap money, factories are idle, citizens uproarious. Belgium will offer a plan for reciprocal and preferential treaties, segregating the gold bloc from the rest of the world. Dutch bankers are talking of pooling colonial empires and drawing in Italy. But fact remains that only France, with better than a 100% gold coverage for its currency, can hold out indefinitely--if Jean Frenchman can stand it.

This file is automatically generated by a robot program, so reader's discretion is required.