ver, it can be said that of the three great
gold markets abroad, London is the only one which can in any sense be
called "free." In Paris, the ability of the Bank of France to pay its
notes in silver instead of gold makes it possible for the Bank of
France to control the gold movement absolutely, while in Germany the
paternalistic attitude of the government is so insistent that gold
exports are rarely undertaken by bankers except with the full sanction
of the governors of the Reichsbank.

It is a question, even, whether London makes good its boast of
maintaining Europe's only "free" gold market. The new gold coming from
the mines does, it is true, find its way to London, for the purpose of
being auctioned off to the highest bidder, but as the kind of bids
which can be made are governed so largely by arbitrary action on the
part of the Bank of England, it is a question whether the gold auction
can be said to be "free." Suppose, for instance, that the "Old Lady of
Threadneedle Street" decides that enough gold has been taken by foreign
bidders and that exports had better be checked. Instantly the bank rate
goes up, making it harder for the representatives of the foreign banks
to bid. Should the rise in the rate not be sufficient to affect the
outside exchange on London, the Bank will probably resort to the
further expedient of entering the auction for its own account and
outbidding all others. Not having any shipping charges to pay on this
gold it buys, the Bank is usually able to secure all the gold it
wants--or, rather, to keep anybody else from securing it. The auction
is open to all, it is true, but being at times conducted under such
circumstances, is hardly a market which can be called "free."

If there is any "free" gold market in the world, indeed, it is to be
found in the United States. All anybody who wants gold, in this
country, has to do, is to go around to the nearest sub-treasury and get
it. If the supply of bars is exhausted, the buyer may be disappointed,
but that has nothing to do with any restriction on the market. The
market for gold bars in the United States is at the Treasury and the
various sub-treasuries, and as long as the prospective buyer has the
legal tender to offer, he can buy the gold bars which may be on hand.
And at a fixed price, regardless of how urgent the demand may be, who
he is, or who else may be bidding. First come first served is the rule,
and a rule which is observed as long as th