HomeMy WebLinkAboutThe Seaforth News, 1945-01-25, Page 3THE ROYAL BANK OF CANADA
ANNUAL MEETING
Morris W. Wildon, President, says continued Canadian, develop-
ment depends on world-wide system of trading based -on
internationalmonetary and exchange stability. Urges
Canada be one of first to approve principles of Bretton
Woods Conference.
Sydney G. Dobson, Vice -President and General Manager, re-
ports total assets at all-time peak with year's increase
great est in history of bank; southern branches in unique
position to facilitate Latin-American trade.
The vital importance to Can-
ada's future welfare of a healthy
foreign trade based on internation-
al monetary and exchange stability
was ,emphasized by Morris W.,Wil-
son, President of The Royal Bank
of Canada •at the bank's Annual
Meeting,
Canada owed her economic de-
velopment from earliest days, said
Mr. Wilson, to foreign trade and
the level of pre-war exports would
not only have to be maintained after
the war, but actually expanded,
possibly to double their pre-war
value, if Canada was to secure an
adequate national income.
-FOREIGN TRADE PROBLEMS
"Normally we export consider=
ably roore" to Great Britain and
other "countries of the Empire than
we import from them. On the other
hand, our imports from the United
States are usually inexcess of our
,exports to that • country. Under
normal exchange conditions it was
relatively simple to adjust this
situation. Our sterlingbalances,
accumulated through exports to the
Empire, were readily exchangeable
for U.S. dollars with which to pay,
for what we purchased in the Un-
ited States..
"War -time experience, however,
has shown the diff( ulties which
arise when this multilateral adjust-
ment of trade balances breaks
down. As a result of the control
of .sterling made necessary by the
war, Canada has been forced to
depend upon her own devices for
liquidation of British balances,
through interest-free loans; mutual
aid, and the repatriation of Can-
adian securities. We were also
forced to restrict purchases and
travel in the United States, in
order to reduce the demand for U.S.
dollars, thereby making it easier
for us to pay for essential imports.
If the world should be divided into
exclusive trading areas after the
war, as is frequently suggested of
which one might be based on sterl-
ing and another on the U.S. dollar,
Canada would be in a peculiarly
disadvantageous position since she
properly belongs in neither group.
Our membership in the British
Commonwealth of Nations, and the
coincidence that our unit of cur-
rency is named "dollar" as in the
United States, create an anomalous
situation, and obscure our true
position in the eyes of many. Be-
cause of these factors, and our own
selfish interests, we are compelled
to prefer a world-wide system of
trading. There is no altruism about
it.
CANNOT STAND ALONE
"If international trade on the
broadest scale isnot fully restored,
what can Canada do independently
to preserve her foreign markets?
There arc certain obvious meas-
ures, notably maintenance and im-
provement of the quality of our
exports, vigorous salesmanship, and
the acceptance of imports from
countries to which we export, up
to the limit either of their capacity
to sell to us, or of our ability to
absorb their products. These are
basic principles which Canada can
and should adopt, whatever the
rest of the world may do.
"What other alternatives will be
normally .avialable to us? In the
first place, we _might have to re-
strict our exports to the ability of
foreign markets to pay for our
lroducts. Since many 61 our ma-
jor export, commodities are produc-
ed on a_seale out of all proportion
td our own consumption, the. sub-
sequent unemployment of men and
resources, the agricultural depres-
sion, and the social problems which
would arise, would build up a load
that our economy and constitution
.could not support. Secondly, Can-
ada might provide credits to coun-
tries desiring to import goods on
a basis similar to the credits which
have been established during the
war, but with the hope of ultimate
repayment. Finally, we could sub-
sidize exports.
"Fur'thermore, as I stated a year
ago, I believe it would be sound
policy for Canada not only to ex-
tend liberal long-term credits to
countries who are actual or poten-
tial buyers of Canadian products,
but in special cases to make out-
right gifts of foods, raw material,
finished goods and machinery to
assist, and hasten the rehabilitation
of such countries.
"Thus far could we go,'independ-
eutly of the policies of other pow-
ees. But annoment of consideration
will show howslight o'ur hopes of
success •would be without inter-
national co-operation,"
Mr. Wilson reviewed the function
of gold as an international currency
prior to and after the last tear but
pointed out that the "gold stand-
ard" was never entirely automatic
in its operation. "The system could
never have been mantained/' he
said, "'without the unrivalled su-
premacy of the City of London in
the foreign .exchange and inter -
.national investment markets, the
degree of liquidity it maintained,
the great foreign loans it floated,
the willingness .of Great Britain
to accept imports of goods and
services for payment on loans and
last but • by no means 'least, the
knowledge and experience of the
great London Hanks and financial
houses.
NATIONS FORSAKE RULES
In the secoud place, all countries
observed the code of economic
ethics set up by the gold standard.
Fundamental changes in this sys-
tem took place following the last
war, said itr. Wilson, and the in-
ternational economic system, -dis-
rupted by the war, remained out
of balance and the ,disequilibrium
became intensified. Countries ceas-
ed to abide by the rules and no
longer sought to adjust their do-
mestic policies to the requirements
of the gold standard system and
with the breakdown and abandon-
ment of the standard in 1931, each
country set out on its own course.
"Instead of adjusting domestic
prices and production to the needs
of international exchange stability
and .balanced payments on inter-
national account, countries began to
manipulate exchange rates, as a'"
means of increasing domestic and
foreign- trade in' order to maintain
employment at home. International
trade became disrupted, with every
country seeking to force its exports
on others, but to reduce imports
to -a minimum. Competitive ex-
change depreciation, 'higher and
higher tariffs on imports, quanti-
tativequotas and bulk purchases,
and similar measures, were utiliz-
ed by all countries in greater or
less degree. Well over a third of
total world' trade was conducted
on a basis of crude barter. With
the collapse of the gold standard,
there disappeared the only oper-
ative system for the co-ordination
of national economic policies; in
its absence, sovereign 'countries,
acting independently and without
regard for the external repercus-
sions of their policies, inevitably
drifted toward international econ-
omic chaos,"
Upon this chaos, said Mr. Wil-
son, had now been superimposed
the new disequilibrium' of a second
World War, The great importing
countries including Great Britain
and those- of Europe had suffered
devastation, destruction of their in-
dustrial machinery and, particularly
Great Britain, loss of overseas
markets. Other countries, notably
those of North America, had found
their industries and ,agriculture
greatly expanded. "In order to
maintain employment," said Mr.
Wilson, "it will be necessary for
these countries and particularly for
Canada, to export to an extent
greater than was necessary even
before 1910."
BRETTON WOODS
Mr. Wilson dealt at length with
the Bretton Woods Conference last
July when the experts of forty-
four countries sought to evolve a
system of international control of
foreign exchange and investment
with a view to providing exchange
stability, He readily admitted that
the Bretton Woods program was
no panacea for post-war problems
but he pointed out that practical
businessmen were largely in agree-
ment with the Bretton Woods ex-
perts. Meeting at Rye, N.Y., last
November, businessmen from fifty
two countries, including Canada,
recommended a Multilateral Trade
Convention for all countries to pro-
vide for the progressive lowering
of trade barriers; the elimination
of quotas and import embargoes;
the abandonment of discriminatory
trade practices; the abandonment
of national sales and production
monopolies,
"It appears to Hie, said Mr.
Wilson, "that the next step in pre.
paration for the general resump-
tion of foreign trade after the war
must be discussions and agreement
between governments on commerc-
ial policy. If some standard of
commercial policy is not establish-
ed prior to the resumption of gen-
eral trading, we may see the con-
tinuance of the predatory practices
of the pre-war era.
"Canadian economic develop -
men t,
evelop-Ment, itt the future asin the past,
depends upon the niaintenance'aud
development of international trade.
Monetary stability is one of the
prerequisites of international trade,
li'or Canada, therefore, monetary
stability is of paramount import-
ance.. 11 we acknowledge these
premises, our course of action is
clear. •ode Hurst implement the
measures necessary' to secure them.
1 sincerely hope that Canada will
be one of the first to approve the
principles of the Bretton Woods
agreements, leaving the Govern-
ment free to deal with matters of
detail in consultation and agree-
ment with the other countries con-
cerned."
GENERAL MANAGER'S
ADDRESS
in presenting the Annual Balance
Sheet Sydney G. Dobson, Vice-
President
icePresident and General Manager,
pointed out total assets were now
at the record level of $1,700,251,802,
and that the increase in assets dur-
ing the year was the greatest in
the history of the bank. The liquid
position was exceedingly.. strong,
he said. Total Liquid Asset repre-
senting 81.62% of the bank's Lia-
bilities to the Public. Noteworthy
was the increase in the number of
Deposit Account Customers which
now totaled - 1.,450,000; Profits for
the year, after providing for Do-'
minion Government ,Taxed, amount-
ed to $3,827,183, an increase of
$$99,89(.
O
'ON TO BASTOGNE!'
Over field microphone, Lt. -Col.
Creighton (Abe) Abrams, of Jack-
sonville, Fla., gives the order that
started the Third Army drive that
relieved the heroic 101st Airborne
Division garrison in Bastogne. Col.
Abrams commands the 4th Armored
Divisions rescue spearhead.
ACTS IN GREECE
Following signing of truce be-
tween Greek ELAS forces and
the British Army, Gen. Nicholas
Plastiras, Greek premier, is faced
with task of bringing order out
of the political chaos that spark-
ed off 40 days of bloody civil
war. Besides premiership, he
holds portfolios of War, Navy,
Air, Merchant Marine.
Mr, Dobson -reported steady de-
velopment of the bank's foreign
business in the Caribbean and
South America, "The South Amer-
ican countries," he said, "are po-
tential purchasers of large quanti-
ties of equipment of all kinds for
modernizing and expanding already
established manufacturing facilities,
for developing new industries, and
carrying out public works programs;
A. growing interest in Canada and
Canadian products is evident, and
it is hoped that our manufacturers,
exporters, and importers will reci-
procate this interest. Our well-
placed branches are in a unique
Position to offer assistance in the
development of trade between La-
tin America and Canada,"
TRIBUTE TO STAFF
The General Manager reported
that the staff, not including those
in the -armed services, now totalled
8,205, "In Canada 71% are young
women, compared with only 21%
in 1-0139. While the more experienc-
ed officers have been tinder great
personal pressure, because of the
need to train and help inexper-
ienced newcomers, these new
members of the staff have learned
quickly, fitted in readily, and per-
formed splendidly the duties allot-
ted to them. All of our officers
serve with a sense of public re-
sponsibility 'as well as of dtity to
the bank.
"Leave of absence for military
service has been granted to 2,255
of our officers since the war start-
ed, of whom 2,104 enlisted from
Canadian branches, This is equal
to 74% of the Canadian: male of-
fivers who were under 45 at the
war's outbreak,"
Looking to the problems of the.
post-war years, IsIr. Dobson stated'
that one of the bank's first con-
siderations would be the placing in
satisfactory positions of the mem-
bers of the staff who were serving
in the various armed services. "Thio
matter.," he said, "is foremost in
our minds and is being given care-
ful study. The affairs of customers
in many cases will undergo great
changes in the transition period
from - war production to peacetime
needs. In this transition we shall
is called upon to play an import-
ant part in assisting financially in
helping to bring about this change.
It may be necessary, for us to revise
to some extent the existing practice
of making loans for short terms
only, and in certain circumstances
to consider loans -extending over a
period of two, three, or five years.
to meet changed conditions,
"I am not implying- that we
should depart from our policy of
prudent banking, but because of our
large holdings of readily negotiable
Government securities, • we may,
without risk Ca our liquidity, assist
te.serving borrowers with longer
term loans.
"Your bank is strong financially
and exceedingly well equipped to
handle post-war financing, and we
shall consider it our patriotic duty
to play our full part iii'assisting
business generally in becoming re-
established."
WHY HOME FRONT MUST TIGHTEN UP
Everything expended on the War Fronts means just that much less for the Home Front, and the
promise of 5945 is that combat expenditures, some of which are pictured above, will reach hith-
erto unimagined totals. CASUALTIES: Running at the rate of 1,600,000 a year, are expected to
increase as war's tempo speeds up. AMMUNITION: More than two tons of ammunition are fired
every minute of every day at the Germans alone, with rate of fire increasing. TIRES: Life -span
of tires in combat is often measured in minutes. As supply lines lengthen, tire requirements will
increase. GASOLINE: Combat reverses, resulting in loss of gas -dumps, like that in photo; ever-
increasing mechanized strength and growing air forces, including such gas eaters as B -29s, the huge
new B -22s and other giants will use gas in unprecedented quantities. MECHANIZED EQUIPMENT:
Tanks, trucks, jeeps, ducks, tank destroyers, motorized artillery and other equipment are highly
expendable, as photo of Germans advancing past burning Allied half-track indicates. PLANES: As
enemy's defenses tighten up, plane replacements will be increased,
LST HEADS FOR SHORE AS LUZON IS INVADED
An LST, loaded with troops heads for a Lingayen beach as the invasion of Luzon got under way.
Floats for portable docks can be seen on the side of the landing ship. Other ships stand by, waiting to
send their troops ashore.
DISABLED VETERANS MAY DRIVE
Promise that serviceruenwho have lost their legs will not be
deprived of the convenience and pleasure of auto driving is seen
in the fact that the two veterans inthephoto above have just won
driver's licenses in .Georgia. They learned to drive with artifice'
limbs at Lawson General Hospital, Atlanta, At left is a sergeant
of the Georgia State Patrol, who supervised their successful road
tests.
JUST IN CASE
Advancing cautiously, his rifle held ready just in case iit's a trick,
the Alliedsoldier at left ap s.,• c ;s the body of a German in
s snow-covered farm pasture tzar La;,tcgtte, Belgium.
MANY THANKS go to
wives and mothers who
serve Maxwell House ! Yes,
Canadian families love
the delicious, -satisfying
flavor of this superb blend
of Latin-American coffees.
BEAD COLDS
ACMES—PAINNS go FAST
' CINNAMATRD
CAPSULES
This grand prescription gives you
the benefit of not ONE but FOUR
proven pain-relievinggcold-dis-
pelling. ingredients. Here's how
they work-
1—Relieves Pain and Feverish.
noes fast. -
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3—Gives the lift yoshmay need:
4—is grand for Grippe.
Geta tin today
Eadnr Swaliewsd
-ActFa,*er