File:Bell telephone magazine (1922) (14569440700).jpg

Identifier: belltelephonemag4344amerrich (find matches)
Title: Bell telephone magazine
Year: 1922 (1920s)
Authors: American Telephone and Telegraph Company American Telephone and Telegraph Company. Information Dept
Subjects: Telephone
Publisher: (New York, American Telephone and Telegraph Co., etc.)
Contributing Library: Prelinger Library
Digitizing Sponsor: Internet Archive

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is an obligation of membership inthe IMF, even though it may involveacquiring unwanted stocks of a depreciat-ing currency. Conversely, if dollars arepreferred to pounds sterling in the NewYork market at the official $2.80 rate, theFederal Reserve System is obliged to be-gin selling dollars (buying pounds) whenthe exchange rate falls to $2.78. Sincethese requirements may strain the re-sources of the countries complying withthem, other procedures are also institutedfor dealing with speculative stresses. International Cooperation. When spec-ulators feel that a particular currency isgoing to decline in value relative to gold(devaluation) or relative to other cur-rencies (depreciation) they convert theirholdings from the suspect currency intoother currencies or into gold. By thefamiliar mechanics of supply and demandthis tends to reduce the value of the cur- 45 me Balance ol Paymeois Dilemma U.S. Gold Stock and Short - Term Liabilities (Debts)to Foreigners Source: Federal Reserve Bulletin
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1956 1957 1958 1959 1960 1961 1962 1963 1964 rency being traded away, relative to thecurrencies (or gold) being sought. Butthe value of money is not allowed to fluc-tuate beyond relatively narrow limits.The interests of a nation and the rules ofthe International Monetary Fund requirea stability in the value of currencies.Therefore speculators must be suppliedwith the gold or foreign exchange theydesire, at or near the oflicial exchangerate. There are a number of possible waysof doing this. Political pronouncements (We shallmaintain the value of the dollar, etc.)and administrative rulings are sometimessuflicient to discourage speculation. Gov-ernments may also directly enter themoney market to counter speculativetrends by their own sales and purchasesof domestic and foreign currencies forfuture delivery. These forward exchangeoperations are designed to add to the supply of currencies whose prices are ris-ing and add to the demand for currencieswhose prices are falling. Support of theof

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