The diamond drill. (Crystal Falls, Iron County, Mich.) 1887-1996, 1913-01-04


Exports : 536. sol. 73t
:! Imports 900, 500. f3i
Excess Of exports. : 3i6 0S9. 50l
In that same year tae imports Of
gold to the United States from En-.
gland were $l3, 77s.2i2. With more
than three hundred millions against
her IN the balance Of trade, London
sent us less than thirteen millions in
gold
Obviously, England has some means
Of Otfsetting this unfavorable trade
balance other than her visible exports.
The most important Of them is that she
levies tribute in interest charges on the
United States through ne. possession
OF an unrivaIed monetary system. She
pays in part for the foodstuffs and
manufactured goods we send her by
financing our foreign trade and travel.
IL has been estimated that Americans
spend one hundred millions annually
in Continental travel Their expenses
are financed. for the most part, by
drafts on London. on which London
takes toll Still greater is the profit
London takes constantly 10y discount
ing American bills of exchange, financ-
ing American spectators and promo
tiers, carrying over shares for Ameri.
cans in the London market and max
ing advances in other forms.
II is true that England has other
invisible exports besides the credit
she sells u.s. which help to offset her
unfayorable trade balances, and IL may
not loo amiss to set some OF them down
here American products are moved
to all parts of the world in English
bottoms-about 90 per cent of our ex.
ports and imports are carried in foreign
ships. Many settlers in the United
States regularly remit money to their
families in England. British investors
mold American securities which yield
them constant income in interest,
paid in American goods. Rich Amer.
cans spend money lavishly IN English
travel, IN the purchase Of art objects
andin English society; aud the dowries
American heiresses take to their titled
British husbands are factor lay no
means negligible
But the most important factor is 10
I'D fann1 In EnttIaY
ing facilities and her commanding po- |
sition as the head of international fin |
ance Primarily, her undisputed pos
session OF this place may be said to be
due % the tact that London is the only |
place IN the world where credits are |
instantly convertible into gold. in any
amount and al any time. In interna.
tional finance draft on another center
is valuable only from the readiness
with which it may Dc converted
through the machinery Of exchange.
into draft on London. The notes OF
the Bank Of France. for instance. are
convertible at its option either into
gold or silver so that If you have
credit in Paris, il may be of no value
IN New York unless you can use i To
buy credit in London The German
Reicbsbank has a single gold standard
but the bankers Of Berlin throw OBJ
stacles in the way OF those who seek TO
draw on the Imperial Banks store OF
gold to any large extent.
theoretically, draft on New York
may be converted into gold certificates
lnd so into the basic metal; but our
money panics. during which
Iuch draft may not be convertible !,
nto anything, have led foreign bank.
rs to look on us with suspicion and .
international finance !,
Toes not view such draft with tull /,
And even when confidence !,
8 restored, we can not assume the bur !,
len Of financing the world i trade. !.
ven could we capture it from London. :
we retain our present banking sys. !
en- because il does not provide the !
lasticity Of credits requisite TO that :
JUNCTION. :,
When IN 1907 England drew gold :,
rom seventeen other countries to send \
, clamouring banks here. the gold was =
ant 60 us, not direct but through Lon. -
on, because the foreign bankers knew
hey could get il back from London \,
hen they wanted it, and they knew y
othing OF the kind about New York. n
hat was special instance but the -
'me truth is illustrated constantly in
lsernational trade. II. for instance -
New Orleans cotton factory sells d
Of staple to a spinner in -
:. Gall, Switzerland. he does not drawn :,
Is bill Of exchange directly on the
inner he draws IL on London bank 20
accepting house with which tho