New-York tribune., 1912-01-09
DUEL ON CHINESE LOAN
Baron Cottu Alone Against the
Four Chief World Powers.
FRENCHMAN NOW IN EUROPE
His Government Having Refused
Him a Bourse Quotation He
Tries England.
Gy the regular correspondent Of The Tribune in

d7y tho regular correspondent Of The Tribune IN
PeknGD
Pekng, December
Tho imperial government OF China still
exists. and the position Of the government
has materially improved. Yuan Shlh-Kal
during the last week or ten days has ac-
complished much after a period OF seem
ing inactivity. The imperial victory at
lIankow has tremendous importance, ana
at last gives the government the prestige
Of sovereignty and control which has oeeh
so necessary. and also SC lacking hitherto.
on the other hand, the rebels have ac-
quircd much prestige by driving the Inn
perials out OF Nanking. There are mum
ber Of indications. however, that the rebels
are ready 10 reach compromise.
Yuan has already recovered the province
OF Shang rung. tremendous state and an
important one, which, several weeks ago.
declared its independence. Shan Tung'
through the efforts of Yuan, Is now back
In the fold, and the Governor, who led the
malcontents astray has been pardoned.
West of Shan Tung lies Chih Ii. wherein
Poking is situated. Chh Ii is not as I'M
peralistic In It's tendencies as might be
presumed OH account OF tPe presence OF
the government and It's troops In her very
midst, and Yuan has work 10 do here. too.
This he has already undertaken, and pres
entity Chih Ii will be purely governmental.
Emissares have been sent into Shan NJ
province, to the westward, where there are
many rebels. many of whom do not seem
10 he particularly militant. These agents
of Yuan are expected to bring the rebels
back into the imperial fold. All these
things dOne-and they arc by no means Inn
possible; in fact. they are quite probable
and Yuan Shih-kai will have tremendous
portion Of China back under imperial CON
troll. The moral effect Of such imperial
progress as this will he great, and will
tend 10 make the rebels agree 20 an ad-
justmcnt
Failed to Float Loan.
or equal importance To the effect such
progress will have on the rebels Is the ef-
feet II will have upon the world at large.
and particularly upon lenders OF money.
Yuan Shih-kai has I'm vain endeavored 10
float a foreign loan The powers will not
sanction the lending OF money. and with
out such sanction tho bankers will not
lend. The imperial funds are running lower
and lower, till, strange as It may seem
in this tremendous country. the central
government has scarcely n tael left In the
treasury. The lack OF funds continues 10
be a distinct menace Tho rodiers NAV
shortly be without their pay. and the ar
rearages OF foreign loans are constantly
growing greater and greater.
This matter is one Of distinct concern 10
the powers. whose bankers have lent money
e., t, -. - A.,
will bc necessary 10 seize the salt mo
nopoly and the customs which were put up
a guarantees for the loans and indemnity.
Some weeks ago the Chinese government
signed an agreement with Baron Cottu. the
French financlcr. for loan of 100000
francs Ninety million francs was TO be
borrowed at once and tho remainder at
some later date on December ! an agent
Of the Cottu syndicate and the government
signed an agreement for the remaining
100000 francs. In the mean time. how
ever. although much time has elapsed,
Baron Cottu. who is in Europe. has failed
to float his loan The French government
has refused 10 give II a quotation and
Cottu has moved 10 England. according 10
latest reports He will enleavor 10 ae.
the money there and In Belgium.
Banking Groups Surprised.
Baron Cottu's loan forms an interesting
financial story. lie came 10 Peking unan-
nounced. and when it was made known
that he had signed a contract for the loan
there was great surprise. particularly
among the agents Of the four banking
groups-of America. Germany, France and
Great Britain-which had hitherto con
trollcd the money market out here. They
had hoatcd the IIu kuang and the currency
reform loans. and were considered as the
only ones In a position 10 lend the Chinese
government any great sum " money.
Times were perilous at the morlsp;, tut
Baron Cottu expressed his conitdenc, IN
the ability OF china TO repay. and went
ahead. The so-caled group" OF bankers
Of the four nationalltles had already turned
with a proposition. Cottu so far convinced
the government Of his ability 20 raise the
money that they readily entered into the
agreement. although any great effort at
convincing was probably unnecessary. as
the government was In dire need or funds
and ready TO jump at any possible chance
OF getting real cash.
There arc indications that there ensued
n financial duel, with the group on one
side and Cottus syndicate on the other
So far the group seems 10 be ahead for
the French government has refused a quo
taton. and without this Cottu is very much
embarrassed.