New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1900-11-02
THE LATE GERMAN LOAN.

TON AND THE BERLIN EXCHANGE.
G. Won Siemens. president Deutsche Bank Of
Berlin. in Die Nation. October g.
In Germany the growth of the Stock Elk
change comedies with the Introduction Of steam
engines and the railroad. the first Of which null
tiplied production many times. while the latter
made possible sale beyond provincial bounda-
ries.
The funds required for these two new phe-
were insufficient in Germany. There
not enough private capital. Here the Elk
change interviewed While the corporate form
facilitated the concentrat ton Of capital the sala-
bility OF shares. issued TO bearer and negotiable
at the Exchange, permitted the individual owner
maintain his investment in easily con-
veTtible shape while at the same time 1t sate-
guarded the corporation against the withdrawal
Of such capital. The dealing for future delivery
and the easily obtained admittance Of any mer-
chant permitted funds to he drawn into
the economic movement which were only tenn
porarily available. Aside from the aid of sci
euce the rapid progress Of industrial develop
ment is mainly based on this service of the Ex-
change more so in Germany than in England
which enriched through the Napoleonlc
wars and France. with her climatic advan-
tages. The freedom of movement helped to
overcome the handicap Of smaller natural ad-
vantages
GREAT FORTUNES RARE IN GERMANY.
1t is a peculiar phenomenon connected with
our social and economic conditions that CO.
lossal fortunes are more exceptional in Germany
than elsewhere. Not only co the Germans who
have grown rich abroad rarely return 10 their
homes in which they differ from the English.
French and Russians but MANY who nave
grown wealthy in Germany prefer TO live IN
London and Paris. This condition continues as
l,vr lately enriched
in tie Transvaal who almost without an ex-
ception have remained in England or removed
to France This fact made il all the more I'M
portant facilitate the concentration OF snlall
bodies OF capital. Besides the immense sums
reouEed for railroads built by private initiative
the funds made available for use in exploiting
coal mines aggregate 600oo0,ND marks. While
those invested in iron mines and furnaces rep
resent / 100 100000 marks and those IN the in
dustry OF spinning and weaving textile 1aprlcs'
TO0O00OOO marks. II comparatively easy
however for Germany to procure these sums,
because its centres Berlin in particular. were
far ahead of all other exchanges until AFTER
the middle of the eighth decade OF this century
in the low rates charged, the honesty OF their
quotations. the simplicity Of their legal forms
and the punctuality of their service Money
IS liquid, like water. and will flow where 1t
meets with least resistance. With the introduc-
economic circle Of the Western nations; her po-
litical consolidation and economic development
were already incontestable. Berlin was. there
fore soon destined TO be a centre of deposit for
the funds Of the richer nations. and came to
be called upon by foreign governments that
were trying to negotiate loans. Though German
funds were not get sufficient permanently to hold
those loans. still many contracts were negotiated
with German houses. The fact that the leader
ship in such instances was with the German
market secured incidentally the command Of
the foreign capital seeking investment in such
loans. and gained through the connection itself
q series of indirect advantages. Thus Berlin
was slowly growing up to the proportions OF
the three large International exchanges, Lon
dom New-York and Paris.
All requirements in the industrial field, as well
as in that Of Government loans. which cannot
be adequately mlnistered to by individual cap
ital. naturally seek the largest market. The
more extensive the organization the greater Is
the number of purchasers reached by IT, the
latter not being confined by geographical bound
aries or the limitations of language, is illus
trated by the gold shares. which almost
exclusively dealt in in London and to a mod
crate extent in Paris. The Berlin Exchange
does not know them. though certainly several
hundred million marks of German capital are
invested in such shares In the way the
purchaser Of American railroad shares Ar
gentine, Turkish and Spanish securities has TO
turn in most cases to London, sometimes to
Paris. Vice versa, people from such countries.
or the States themselves viii! apply for their
monetary requirements to places where they
may expect to find a proper appreciation Of
their securities.
HOME CONTROL DESIRED.
A country possessed Of some wealth will en-
-sI,o,
try at its exchange. 1t felt a
serious disadvantage in Austria until recently,
and It is felt such in Spain yet, that parts
Of their railways We're controlled in France.
Weather countries naturally desire extend
their industrial activity into other countries.
Any bank railroad organized in another
country. the shares OF which have remained at
home. IS pioneer not only for the development
OF the countrys industry but for the establish
ment OF permanent relations between the two
governments. Influence abroad is largely due
20 such ownership. as in the case of the French
influence in Spain. Portugal, Italy and the
Orient. The time has passed when it would be
thought possible TO maintain friendly political
relations between two governments while the
people were in economic antagonism. With the
growing influence Of the the questions
OF the stomach growing to be political fac
and decide in the last resort the policy of
the government.
During the last decade Germany has also be-
gun to extend her industrial activity abroad
after having confined herself for years to COM
merce with foreign ports and steamship enter
prises. The invention OF the dynamo originated
in Germany and first applied there a largs
scale, introduced motive force into Ger
industry. Great new industrial establish
nlents grew up. soon branching organize
permanent enterprises abroad. During the last
fifteen years electricity has certainly required