Orleans County monitor. [volume] (Barton, Vt.) 1872-1953, 1899-06-12
Tho hills Of EXCHANGE

money. The bills of exchange, in
which more than eight tenths of the
payments were made, were created
by the sale abroad of securities that
had been held by Frenchmen. France
was not rich country. It's citizens
held quantities of stocks and bonds
representing investments in Germany,
Austria, Turkey, Italy, Spain, Egypt
and America, and other parts of the
world. When the loans Of their gov
eminent were put on market these
people sold these securities on the
foreign bourses and turned the bills
of exchange thus received over to the
French government or it's agents, in
payment for it's issues. These bills Of
exchange under the direction OF ex-
perienced bankers, soon found their
way into tills of bankers acting as
agents for the German government.
Thus the obligation was discharged
by shifting of credits and III the
ownership of certain paper securi-
ties.
Some writer's have undertaken to
show that France lost nothing by pay
ment of the indemnity, because, they
argue, if you interview each of the
French investors who exchanged his
foreign securities for rentes, he will
protest that he is no worse off. Tt is
apparent, however, that the annual
income which these investors drew
from foreign securities was paid by
foreigners, while the income they
have derived since from the obliga
tons of their own government has
come from the taxpayers of France.
That country lost so much accumu-
lated capital.
M. Say, commenting upon the part
which securities filed in the settle
ment of this indemnity, said:
'Fifty years ago there was no other
international operations than mer-
chandise and money; merchandise,
gold and silver, were the only subjects
of export and import; the balance of
commerce was settled in gold and
silver. Everything which was bought
from the foreigner was paid for in
gold or silver, if not in merchandise.
'tOne might find, then, in the sta
tistics of the custom house data more
or less exact, but at least real daya,
Of the course of business between two
countries; but things have greatly
changed within fifty years.
There has appeared, especially
during the last twenty-five years, in
international commerce what may be
called new article of export-an ar
ticle which in every country has ac-
CURED a greater Importance than any
other, and which has the result of
completely distorting the meaning
of custom house returns. This new
article is securities; it is transmitting
across the frontiers of different States
the property of capital by represen
tation, which is easy to transport
viz: these capitals of the form Of bills
of exchange, public funds, shares and
obligations of railways and other COM
panies.
ssTo understand the real course of
kuS1A0SS III 1S 1ICC6SScIy
to know not only the imports and ex-
ports of merchandise, the imports and
exports OF specie, but also the i'm
ports and exports of securities; and
this last class, which is the most i'm
portant, and which is the key to the
two others, escapes all kinds of re-
turnS.0
Thus it is that the effects of any
sudden or unusual disturbance of
trade, such as result from failure of
crops in one country requiring extra
ordinary Importation of foodstuffs,
are now miminized. The great vol |
ume of securities of international
value, held in all countries and traded |
in on all exchanges, are now recog-
nized commodity for the settlement |
of international balances, and are
used to a greater extent than gold. |
They have become, in a measure, a
substitute for gold in that Office.
The Diet Fad.