The Birmingham age-herald., 1913-05-30
Gained BY Other Countries


ing of Its market to foreign trade.
Gained By Other Countries
After the American syndicate felt JUS
| titled in retiring from the six-nation group
which had agreed to finance China, the
conviction was very strong that much Of
the market of China, especially for com
modities which enter into public works
and railroad construction. would be
gained by Great Britain, by Germany
and by France. Intimations have come
from Great Britain that in view of the
assistance which the bankers of London
have given China the new republic Is
to place in Great Britain contracts and
orders in very large amounts. That is
precisely what Japan did with the United
States at the time of her war with Russia.
Japan was able to finance here large
money loans. Much of the money thus
obtained was placed upon deposit in the
United States or was sent to London and
stood to the credit of Japan. Enormous
amounts of material equipment and food
products We're bought by Japan in the
United States and were paid for with
money which Japan obtained through the
sale of her securities in the United
States
Mr.. Dawson will be able to tell his
friends in this city how greatly manu-
facturers and the merchants have been
benefited through the action of China in
placing orders in Great Britain. So far
as any one knows, China has placed 10
orders in the United States, and does
not now contemplate doing so. Yet be-
fore the American syndicate was conf
PEELED to withdraw from the six-nation
group, soon after the new administration
at Washington came in, there were as
surances that China purposed buying
large amounts of material in the United
States and paying for it with the money
which she obtained through our own par
ticipation in the national loan
1t does not matter much, in the opinion
of our bankers, that no American money
is represented in the hotation of the new
loan with China, but it may be of some
Importance hereafter. so far as our orr
entail trade is concerned to learn that
China is buying the enormous amount of
material which it needs of the nations
which have participated in financing her
loan.
OF Course 1t Was Absorbed
| The marketing of the Chinese loan in
London last week was a matter of curl
Gus interest In this city. The curiosity
centered upon the question, Has China
| offered large enough inducements to off
set the considerable risks which all finan-
ciers feared lay behind this loan? The
| leading economic journals OF Great Brit
ain have called attention to the fact that
| the security offered by China for the pay
| ment of interest and principal can scarce
| ly be called high-grade security. No one
| is convinced that the present republic
will endure.
In order to offset the risk China found
herself at the mercy of the European
syndicate. The American bankers cannot
be termed Shylocks the drivers Of
cruel bargains with China, for they have
no part in this financing.
The fact that the Chinese loan was
oversubscribed In the London market
demonstrated to those in our financial
district who were of curious inclination
that the terms China was compelled to
accept were sufficiently tempting to call
out favorable responses from British in
vestors. The loan itself carries per cent
interest The syndicate is presumed to
have taken it at "a cents on the dollar
and to have marketed it at about 20.
These figures serve to show how great
the temptation offered by China to those
whose money she sought really was, and
explain why the Chinese loan was over
subscribed in the loan market
Our own financial world will undoubt-
edly obtain some very interesting de-
tailed information respecting the market
ing of a loan upon which China expects
to rely while establishing the new re-
public upon firm basis
A Years Record
Only two months of the present fiscal
year remain. Already the official record
of our foreign commerce from the first
of July last year to the first of May this
year has been compiled The figures
make possible a fairly good estimate of
the total amount OF our visible trade bal
ance In this fiscal year. In 10 months
this visible balance Is approximately Ave
hundred and sixty millions 1t should be
found at the end of the present fiscal
year to be about six hundred and thirty
millions. OF course, against these figures
must be offset the heavy charges for
freight, insurance and other invisible and
unrecorded payments we have to make tc
Great Britain every year. But 1t is re-
garded here as fortunate that the excess
of our exports over imports should have
been able, without much disturbance, tc
absorb the great body of American So
curities which Great Britain has found
it expedient or compulsive to sell within
the past 10 months.