All other items in this miscellaneous group are estimated to represent receipts of $95,000,000 and payments of $20,000,000. Receipts from abroad of communications companies aggregated roughly $13,000,000 as compared with $9,000,000 in 1932, while payments amounted to $9,000,000 as compared with $7,000,000 in the preceding year. Motion-picture royalty receipts in 1933 are estimated at $75,000,000. Minor items, such as the import of Canadian electric power, international advertising outlays, and international newspaper and periodical subscriptions, are estimated to have shown no important changes as compared with 1932.14

14 See note, Miscellaneous commodity and service items, to table in appendix L.

GOLD MOVEMENTS

The net result in the country's balance of international payments of the year's gold exports, imports, and earmarking operations was a credit of $172,700,000. The most important statistical factors in the year's movements were the heavy earmarking operations by foreign banks prior to the prohibitive orders of March 6 and 10 and the subsequent withdrawal of the metal from earmark for export by the foreign-creditor banks.

The gold movements during the early months of the year are clearly summarized by the Federal Reserve Bank of New York as follows:

During the opening weeks of 1933, the dollar was above parity with the other gold currencies and the monetary gold stock of the United States increased moderately as a result of imports, in continuation of the gain recorded during the second half of 1932. After reaching the high point for the year on January 18, however, the gold stock began to decline, and the loss of gold continued at an accelerated pace during February, accompanying the development of the banking crisis in this country and attendant weakness in the dollar in terms of other goldstandard currencies. The gold loss occurred largely through the earmarking of gold for foreign account, reflecting further withdrawals from this country of shortterm foreign funds, which already had been reduced to small proportions at the beginning of the year. Between January 18 and March 3, the monetary gold stock declined $324,000,000 to approximately $4,240,000,000, an amount which, however, remained well above the average for the decade following the war.

The gold outflow came to an abrupt halt on March 4, when banking holidays were declared in practically all States which had not already restricted banking operations, and by the Presidential Proclamation of March 6 and the Executive order of March 10 the export and earmarking of gold were prohibited, except for transactions licensed by the Secretary of the Treasury. Despite the restrictions on gold transactions, quotations on the dollar in terms of the leading gold currencies generally fluctuated within the gold export and import points between March 3 and April 13, and the gold stock rose $70,000,000 due to releases of gold from earmark for foreign account, imports from the Orient, and some return of gold bullion to the mints and assay offices out of domestic hoards.15

An Executive order of April 20 suspended the licensing of gold shipments except that the Secretary of the Treasury was authorized to issue licenses for the export of gold previously earmarked for foreign governments and foreign central banks. Until further order, the earmarking of gold for foreign account and the export of gold coin, gold bullion, and gold certificates was prohibited.

An Executive order of August 29 made it possible for gold produced in the United States to be sold at a price higher than the statutory price of $20.67 per fine ounce. Under this order the exports during September of gold recovered from natural deposits for sale abroad amounted to 89,175 fine ounces; in October they were 257,354 fine ounces; and during the first few days of November, 29,592 fine ounces. These exports then ceased as a result of an Executive order of October 25, which revoked the order of August 29, and provided for the purchase by the Reconstruction Finance Corporation of newly mined gold

Nineteenth Annual Report, for the year ended Dec. 31, 1933, p. 25.

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at prices fixed from day to day. Four days after the new order it was announced that the Reconstruction Finance Corporation would buy gold in foreign markets as well as in the United States.

Beginning in July and continuing until October, gold previously earmarked was exported in large volume. The shipments during the 4-month period aggregated $259,000,000, of which approximately 88 percent was taken by France.

More than 82 percent of the year's gold imports came in during the first 2 months of the year. Approximately $40,500,000 represented receipts of gold that had been placed under earmark in London on December 15, 1932, to the account of the Federal Reserve Bank of New York, in connection with the British debt payment of that date. Imports after the first third of the year were virtually negligible.

MOVEMENTS OF PAPER CURRENCY

For the second consecutive year the net inflow of United States paper currency was on an abnormally high level. It is likely that uncertainty as to the future value of the dollar was an important factor in the heavy inflow during 1933. In many cases economic need apparently forced currency out of foreign hoards that had accumulated in earlier years.

Paper-currency movements assume somewhat the nature of shortterm capital transfers, inasmuch as currency notes are in fact noninterest-bearing securities. Under a gold standard regime they may be normally viewed as a substitute for gold itself. This is particularly true in the case of paper-currency exports, but the return flow may be stimulated, as in 1933, by the fact that gold payments have been suspended. Owing to these factors it is believed to be desirable that currency movements be recorded as a separate item.

In accordance with a practice begun in 1923, 10 leading New York banks reported their receipts and shipments during 1933 to the Federal Reserve Bank of New York. The monthly results are shown in table 14.

Total currency imports by these banks aggregated $104,693,200 in 1933 as compared with $94,900,000 in 1932, while in each year reported shipments were small ($2,200,000 in 1932, and $5,894,350 in 1933). The greater part of the year's net receipts came from European countries, particularly Germany, the net inflow from nonEuropean countries being only slightly more than $8,000,000. The Federal Reserve Bank of Atlanta reported a net shipment of $1,280,500 to Cuba during 1933, as compared with net receipts of $14,300,000 in 1932. In addition to this net shipment, account must be taken of unrecorded exports of currency, principally in the form of money carried in the pockets of tourists, and sent abroad in the mails. Large hoards of United States currency in central Europe had returned to the United States during 1931 and 1932. This movement continued during 1933 and included the return of United States currency in the hands of people of relatively small means who had held on to their small holdings until the dollar began its rapid decline, when they tended to become alarmed. There is also reason to believe that currency which had been hoarded in Russia, Poland, and other eastern European countries was returned through Germany. The return of a substantial volume of the older large-size notes indicates that at least some of the paper currency returning to the United States during the year came out of foreign hoards.

Returns of currency from Canada through the banks exceeded shipments by $2,290,000. With the United States dollar at a premium in Canada during all but the last few months of the year, it is likely that these receipts represent the immediate return of tourist funds taken into the country by our motor travelers and other tourists. Similarly, it is likely that some currency was taken to Europe during the year.

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It is not believed, however, that such unrecorded movements were very substantial, and the estimated net inflow for balance-of-payments purposes is therefore placed at $90,000,000.

TABLE 14.-SHIPMENTS AND RECEIPTS OF UNITED STATES PAPER CURRENCY TO AND FROM FOREIGN COUNTRIES, 1933 1

1 These figures are only those reported by the 10 banks through which the major part of the currency movements take place. For reasons explained in the text, the reported figures cover a much larger proportion of all currency returning to the United States than of the total going out of the country.

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