NEW YORK TIMES JULY 29, 1914
OUR STOCK OF GOLD EXCEEDS A BILLION
Treasury Can Meet Any Demand That May Be Made, Government Officials Declare.
GREATEST STORE IN WORLD
Treasure Chests of European Nations Insignificant In Comparison--Outflow No Embarrassment
Special to The New York Tlmes.
WASHINGTON, July 28.-Treasury officials are watching very closely every angle of the gold situation as affected by the shipments or American gold abroad. But they assert that they are not worried over these shipments and that every demand made upon the Government for gold will be met and can be met without embarrassment.In view of the great difficulties experienced by bankers in obtaining insurance for gold shipments to Europe because of the Austro-Servia Conflict, and the perils of transit in case of a general European war, Secretary Daniels was asked tonight if there were any circumstances under which the Government would allow the use of a warship for the safe carriage of gold abroad.
“No,” replied the Secretary. “Certainly not, unless the President and the Secretary of the Treasury should ask tor such use of a warship. Such a thing has never been suggested and would be a brand-new proposition. No such thing was ever dreamed of by our department.”
Mr. Daniels said that at such a time as the present, when the United States naturally would preserve an attitude of strict international neutrality, very careful consideration would have to be given to any proposal for the use of an American warship for the shipment of gold abroad.
The supply of gold bars at the New York Sub-Treasury having given out today and the use of coin resorted to, Treasury officials were asked whether more gold bars would be shipped to replenish the supply. John Burke, Treasurer of the United States, said:
Can Meet Any Demand
No details of the shipment of gold bars will be made publ1c, because we do not consider it good public policy to announce when bars or coins are to be shipped to New York or elsewhere. We do not think we ought to tell what the Government is doing in the matter of gold movements. There are several reasons why that would not be wise.
“But," continued Mr. Burke, you can say that the Government stands ready to meet any demand for gold that may be made upon it, and that the Government is in a position to do this. Whether the demand will be met with gold bars or with gold coin we do not care to discuss. We have a stock of $l,280,000,000 of gold in bullion and coin. That is more gold than any other country in the world possesses and almost twice as much as the stock of gold of any two other countries. We could meet a demand for nearly $300,000,000 of gold for shipment abroad and would still have a billion left. We have $400,000,000 of gold in the mint in Denver, nearly as much in Philadelphia, with stocks of gold in Washington, New York, San Francisco, and other places.
"The shipment of gold will not embarrass the Treasury in any way. The Treasury was never in better condition.” Mr. Burke said that some time ago certain bankers, making inquiries of a Treasury official as to gold, were told that a shipment of gold bars was being made from Denver. These bankers were able to turn their information to pecuniary account. There were complaints from ba.ks that had not obtained the information. After this incident, Mr Burke said, strict orders were issued that no information was to be made public at the Treasury regarding gold shipments.
Not Due to European War
According to Treasury officials, the present heavy exportation of gold has no connection with the war in Europe The shipments, they say, are being made to pay our obligations abroad, and are usual at this time of year, although they are slightly larger, due to the increased importations in the last six months.
The suggestion has been made that future shipments might be controlled under the new Currency act by reason of the abll1ty of the Reserve Board to change the discount rate. In the present emergency, however, there is no way to stay the flow toward Europe. The shipment, it was said, merely represents the cancellation of obligations.
The Treasury's gold supply at the close of business on July 21 represented $1,288,216,783, divided as follows: General fund $84,303,914; currency trust funds, $1,051,912,869; greenback reserve fund $150,000,000.
At the end of the same business day the gold coin and bullion stored were as follows: Philadelphia, $ 293,324,193.28; San Francisco $139,466.248.52. Denver $470,574,482.68; to Total, $903,364,824.48. The remainder of the supply, representing $384.851,959, is on deposit in Sub-Treasuries of the United States, subject to quick disposition.
The latest report from Germany shows that the Berlin Government has a war fund of $60,000,000 in addition to a gold supply of $327,710,000. Russia has the largest gold reserve of any of the European nations, amounting to $882,500,000. France comes next with $800,500,000. England's gold reserve amounts to $197,999,535. Austria-Hungary is prepared for war with a reserve of $261,500,000. Italy has a reserve of S228,500,000. These are the latest figures available at the office of the Director of the Mint, and they represent the condition of two weeks ago. The available gold of Germany and England will be increased by the heavy exportations. Treasury officials, instead of being alarmed over the increasing exportation of gold, see in the conditions abroad a return of the gold in the next year with heavy interest. Those familiar with the operations of trade balances declare that a war in Europe would end the increasing importation of manufactured goods from Germany and force the powers at war or preparing for it to buy in the American markets. It is believed by some officials here that if the great powers are drawn into the war and the struggle extends over a period of five or six months or more the United States would get back its $100,000,000 of actual gold with millions more in trade balances. The demand for American food and manufactured products would be so great, it was said, that even the war tendency abroad to hoard gold would be overcome.
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