Word: profit
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Dates: during 1930-1939
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...unbalanced budget should blame other nations for their unbalanced budgets is not explained officially. But the belief is growing that the real reason for delay in stabilization has not been given out and that it refers entirely to the legal snags that have been encountered in handling the gold profit...
...thing is clear--even if the President wanted to stabilize tomorrow he could not do so because Congress will have to authorize the confiscation of the gold profit. When authority to acquire the gold profit is obtained, stabilization will be hastened...
...problem with respect to gold profit is this: When American citizens went to their banks and patriotically deposited their gold and their gold certificates last March, the banks promptly turned over the metal itself to the Federal Reserve Banks, which in turn deposited it in the Treasury of the United States and received a receipt. If that gold has increased in value, and it has gone up already by nearly fifty per cent, then to whom does the profit belong...
Technically it belongs today to every American citizen who deposited his gold with his bank, but hardly anybody asked for a receipt and it would be difficult to find out just who deposited gold and gold certificates. Also it would be regarded as unfair to pay a profit to those who by accident happened to possess gold certificates in March, while the rest of the country used other legal tender currency...
...profit in gold today belongs to the twelve Federal Reserve Banks, which in turn owe it to their member banks, which in turn owe it to the persons who deposited the gold and the gold certificates. To get around this difficulty some form of confiscation of the profit, either by an outright seizure or by a tax of 100 per cent on all gold profit, is being discussed. Certain constitutional difficulties stand in the way of such a confiscatory tax and it has been suggested that the Federal Reserve Banks voluntarily sign a waiver of all possible claims...