Washington, January 18.

Back in 1929, long before the present era of monetary troubles began, the council of the League of Nations appointed a committee to find out the causes of fluctuation in the purchasing power of gold and the effect on the economic life of the world. Today that report, completed in June 1932, has become the basis of President Roosevelt's monetary policy.

It is interesting to examine the findings of the gold delegation, as it has since been called because light is shed on the direction in which Mr. Roosevelt may proceed now that he has in his initial steps adopted the main principles of the League's report.

First of all, it should be noted that the men who composed the gold delegation were radicals and conservatives, so to speak. There were men, for instance, who held views very much like those of Professor Warren of Cornell, who has been the President's principal adviser on monetary questions. In the minority report of the gold delegation, the emphasis on the importance of a commodity index is almost as strong as that which Mr. Warren has given to the doctrine.

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Such eminent men as Professor Cassel of Sweden and Guido Jung of Italy and Albert Janssen, former Minister of Finance in Belgium, as well as George B. Roberts, Economic Adviser of the National City Bank of New York, and Professor O. M. W. Sprague, who was then representing the Bank of England, participated in the work of the gold delegation and in the making of the report.

The findings were by no means unanimous but the majority report, which in itself represented mutual concessions by the economists and monetary experts involved, did set forth certain recommendations for an entirely different gold standard than has even before been used but embracing, of course, the experience of the past and the recognized need for a standard that would not mean such variations in purchasing power as the world has seen.

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The most interesting of the many principles outlined by the gold delegation, and which have a bearing in present day events, are those:

First, recognition of the fact that in most countries gold coin has been effectively withdrawn from circulation and monetary gold has been concentrated very largely in the vaults of central banks. With this there has developed a custom of using gold bullion instead of coin to redeem the notes of central banks.

Second, the holding of foreign exchange reserves in various countries in what has became known as ear-marked gold was commented upon as a practice that has to a large extent prevented the automatic ebb and flow of gold from operating and exercising corrective checks on purchasing power and price levels.

Third, the growing increase in the amount of short term money, as a consequence of the hesitancy of investors to make long term commitments, was a direct result of improper adjustments and stabilization of currencies in the decade following the upheaval of war.

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Fourth, the enormous increase in national debts everywhere and the maladjustment of trade relations resulted in an uneven transfer of wealth from one country to another, thus causing disturbances in the price levels, especially as gold in unprecedented amounts moved across international boundaries.

Fifth, an insistence that monetary policy alone will not correct this situation but that a removal on restrictions of exchange as well as the movement of goods must be brought about, together with better handling of national budgets so that economic restoration shall aid in financial reconstruction.

Sixth, a recommendation that if any price index is used to help measure the fluctuations of purchasing power it should be a wholesale price number consisting largely of commodities entering into international trade.

Seventh, a declaration that the world's monetary supply of gold is adequate but that its distribution and use in international trade is faulty. With better statistical information now available, there should be less occasion for sudden rises or drops in prices, provided there is international cooperation.

"We consider," said the majority of the delegation. "that monetary policy, designed to avoid violent fluctuations of purchasing power, should be based upon a variety of considerations interpreted by the judgment of central banks and expressed in national policies arrived at after due consideration and cooperative consultation concerning their international repercussions. Movements of the index numbers of wholesale prices should be used, not as a single determinant of immediate policy, but as one among many factors to be taken into consideration."

Eighth, the need for a rise in the present price level, which can be achieved by public confidence in the monetary policies of the various countries and which in turn should bring a revival in business and demand for goods.

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Ninth, the delegation recommended that gold reserves in ratio to notes issued should be materially reduced and thus large amounts of gold locked up in central banks would be released to be used as a basis of credit and currency expansion. Either 25 or 20 per cent minimum reserves were considered desirable but the suggestion that no minimum be established was rejected.

Tenth, an effort should be made to avoid the difficulties of foreign exchange reserves by using an international institution like the Bank for International Settlements in Switzerland as an agreed where the assets of gold-exchange countries might be deposited in part. The International Bank would in turn spread its deposits in the Central Banks of different countries as the requirements international exchange seemed to agitate.

Other methods of economizing on the use of gold, or rather increasing to usefulness of our present supply of metre were suggested, such as the increase use of checks by people in countries fly are not as frequent users of check currency as the American people. In commission the report emphasized the need international cooperation and international good will.

It would not be surprising, therefore if the next steps in Mr. Roosevelt's plan were distinctly international, in the best of bringing about a reform in the monetary systems of the world. If the president succeeds in this, he may go down in history as having contributed as much toward the economic welfare of the world in the reconstruction period as America did in endeavoring to bind the world together in covenants and treaties of peace