893.51/7715: Telegram
The Ambassador in China (Gauss) to the Secretary of State
[Received October 2—3:45 p.m.]
1847. Following published by Central News Agency, Chungking, October 1:
“‘The Chinese Government would use 200 million of the U. S. dollars 500 million loan to buy and bring gold here for the purpose of combating inflation and stabilizing prices,’ said Dr. P. H. Chang, Counsellor of the Executive Yuan, at the press conference held on September 20.
Asked how the gold will be used, Dr. Chang replied that the Ministry of Finance will devise ways and means which however cannot yet be told.
A correspondent asked Dr. Chang ‘when people here are just as ready to buy gold savings certificates and gold bonds why should gold be actually imported at all?’ Dr. Chang replied that there may be some people who prefer to have more tangible things than bonds and certificates.
The same correspondent raised another question as follows: ‘In view of the difficult transportation, don’t you think that the available airplane space should be better used for carrying ammunition which has a direct bearing on your war effort?’ In reply Dr. Chang said, ‘To combat inflation and to stabilize prices is also to strengthen our war effort for sound economic conditions inside the country are as important as supplies of arms to our fighting forces.’ When the same correspondent pointed out that whereas gold is bought in America at U. S. dollars 35 or CN dollars 700 per ounce, it is sold in China for much more than CN dollars 700 per ounce and therefore it seems that the Chinese Government is making profit, Dr. Chang emphatically declared that that is a wrong conception. In this war, he said, we United Nations must not calculate profit and loss in dollars and cents; it is cooperation and mutual aid which will bring about the final victory that really counts. He asked if, by selling gold, the United States can help China most, why she should not do so. He further contended that since the prevailing price for gold in New York is U. S. dollars 35 per ounce and China pays it, there is no loss on the part of the sellers at all.”