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With gold flowing swiftly out of its vaults, last week Federal Reserve Bank of New York raised its rediscount rate to 3 1/2%> a 1%, advance from the rate established last fortnight and 2% higher than the rate which prevailed from May 8 to Oct. 9. Through losses of gold to foreign countries and to U. S. hoarders, the Federal Reserve System showed last week a 61.8%, ratio of gold to deposit and notes outstanding against 67.1% the week before, 78.4%, before England suspended gold payments Sept. 21. Legal minimum is 40%. In four weeks the U. S. lost $649,000,000 in gold, largest monthly drain on record. Previous record was a loss of $99.300.000 in June 1928. Last summer when Germany and England were experiencing like movements the Reichsbank lost $247,000,000 in seven weeks, the Bank of England $779,000,000 in a fortnight. If last week's rate of decline in the Reserve ratio were maintained the legal limit of 40% would be reached in the next four weeks. Were the legal minimum exceeded there would be a currency panic, even perhaps suspension of gold payments.

> So that Canadian banks may freely discharge their U. S. obligations, the Canadian Government last week prohibited the exportation of gold save under license. Restriction of gold exports will stabilize Canada's exchange, which has lately been at a discount.

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