New-York tribune., 1907-09-16
EGTPTS COTTON CROP.
Situation Nearing a Crisis-Efect
on Credit.

According TO The London Times the dsloca-
ton Of the credit machinery caused by the Egyp-
tian failures will result in the Egyptian cotton
crop being financed TO a greater extent than usual
on a cash basis. with consequent increase in the
demand on I-ondon's sovereigns. In the ordinary
course of business the planters would have received
about S20GooO0 already the signing of the con
tracts for the crop. but thus far the pur-
chases have been much less than usual The nor
NAL shipment of. say. 10000 bales of 80 pounds
each monthly. requires about I7,@o@H. The
Times saws: Shippers of cotton appear 10 he
trying 10 make arrangements for acceptances.
but when in times like these gap has been made
in acceptance facilities, the strongest acceptance
houses are naturally unwilling fill it The Egyp
tian situation therefore is fast reaching crisis.
The planter will suffer no inconvenience from hold
ing his cotton for some time TO come, but the
spnners must consider the effect of the delay of
weeks or even months. in the delivery Of the sta
PIE at such points as Boston, St Petersburg and
Yokohama
The Frankfort ''Finanzherold'' processes ienor-
ance Of the ultimate destination Of the gold recent
II shipped from New York by way Of Ger
many" but it is increasingly probable that ship
rnents are being used 10 supply a drain Of gold to
Egypt.
The condition of the Egyptian security market
was raised in the House Of Commons through a
question by J. Robertson, which elected a vague
rep1y from Sir Edward Grey. reported in The
London Tines of August q. It must be rernem
bered that the Egyptian planters according TO
official figures. have boarded over s21,otooo in
gold. The bulk Of this is, or was, London's SOW
ereigns- The gold imported as sovereigns. and
portion has been melted down into ingots as less
liza bic TO be stolen. Continental gold coins are
largely returned 10 Europe intact. There are many
persons in Cairo who have sold property to Euro
peans which had value before the building boom
and land in Upper Egypt was sold at eXtravagant
prices which has now been found unsuitable for
cotton II is believed probable that upward Of $50
C,n 90 IS due land notes given by European spec
ulators.
The expenditure Of the Egyptian government in
1907 is estimated about Soooo0oo including such
items as repairs the Assouan Dam and conver-
sion work. while the land tax will produce only
shot s24 on 0o0 subject reduction in consequence
of the insufficient food. Sir Edward Grey Informed
Mr. Robertson that the share and debenture capital
of companies the business of which is entirely or
almost entirely confined to Egypt was s47o"o'o1
exclusive Of the suez Canal company.
The external debt of Egypt, including certain
fixed charges. may be taken at about S52o"pefl
largely held In France This amount does not take
into consideration various guaranteed loans which
are not scheduled in the official reports, but which
exceed in four items only, $50 ocoo00 1t Is evident.
therefore that a large number of Egyptians are
creditors Of European banks and bankers with
power which they will certainly exercise. Of i'm
porting at least s4oooo0o before March J. 1908. IN
gold coin. preferably sovereigns.
According to an Alexandria correspondent Of
The Manchester Guardian the whole banking
system appears TO have worked itself loose from
the cotton market, which has simplfed its own
transactions by dealing directly through the ware
hotsemen. No doubt bills Of lading can be easily
negotiated against actual shipment. but the gap to
which The Times refers appears to be widening.
The spasTnodic and. according TO Edmond Thery.
unistiaed falls in such securities those Of the
Agricultural Bank, with unified per cents quoted
below par. indicates apparently less confidence on
the part Of the French investor. It may be, how
ever also due 20 the higher rate of interest which
induces him TO shift his investments from North
east Africa TO the United States. If, then. ship
rnent of gold from New York to Alexandria should
take place It might well prove advantageous to
this country. by opening larger market in Paris
for our securities.