"In addition, the Treasury will increase its gold sales to at least million ounces monthly beginning in December."
MOSCOW'S DECISION ON GOLD AWAITED
By Russell Porter
BRETTON WOODS, N.H. July 14- Members of the United States delegation to the United Nations Monetary and Financial Conference expected tonight that the Russian delegation would make an announcement tomorrow on Moscow's decision regarding the deadlock which has developed over Russia's gold payment into the proposed international monetary fund. It is beleived that the Russians have already received new instructions.
The Americans hope the decision is to drop or substancially modify the Russian demand for a reduction in the gold payment of war-devasted countries to half or three-quarters of the gold payment of the gold payment of other countries, which has been set at 25 per cent of a nation's quota or 10 per cent of its gold holdings, whichever is smaller. This has been holding up final agreement on the fund, because it is closely linked to the demand for increased quotas, larger voting power, and greater capacity for drawing on the fund for foreign exchange with which to buy American and other foreign goods after the war.
Small Nations Lose on Fund Voting
Led by Mexico, some of the smaller countries among the forty-four United and Associated Nations participating in the conference lost a fight today to establish a voting system which would prevent the Untied States, Great Britain, and Russia from altering exchange rates of other nations through holding a combined majority of total voting ower.
Under the present proposals setting up a fund of about $8,500,000,000 with quotas of $2,700,000,000 for this country, $1,300,000,000 for Great Britain and $1,200,000,000 for Russia, the "big three" would have more than 60 per cent of the voting power, which is to go by quota strength.
The small-nations controversy came up at a meeting of the fund commisision in connection with a clause that would permit the fund by majority vote of quota strength to make uniform proportionate changes in the par value of the currencies of all members, providing each change is approved by every country which has 10 per cent of more of the aggregate quotas, and providing that any country not wishing a change can maintain the existing gold value of its currency by notifying the fund within seventy-two hours after the latter's announcement of the changes.
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"A quadrupling of previously announced gold sales by the Treasury to 1.5 billion ounces a month, beginning in December, up from the 300 million-ounce sales that have been offered so far. (The Treasury had planned to boost the sales to 700 million ounces in November.)
The $28.2 billion pool that will be used to support the dollar also includes U.S. drawings from its International Monetary Fund reserves and an increase in credit arrangements with West Germany, Japan and Switzerland.
The package - the most sweeping the United States has put toward to defend the dollar since Nixon severed the dollar's link to gold in 1971 - amounted to a complete turnabout of policy."
"The dollar has recovered partially, moving up 7 to 15 per cent against major currencies, while gold, which skyrockets when the dollar is in trouble, has declined by 18 per cent.
The United States will acquire marks, yen and other currencies by swap arrangements with other banks, by borrowing in foreign markets, by selling gold, and tapping its credit at the International Monetary Fund."
"The U.S. dollar was firm on world currency exchanges yesterday, suggesting it has found its level after fluctuating for three weeks under President Carter's rescue plan. Gold bullion prices fell in reaction to Tuesday's U.S. auction of 750,000 ounces, but they recovered again late in the day."