New-York tribune., 1913-05-26

the boarding or 1unuS dlioHs '"O
ha bitants who have been in fear of
general European war. Otner couh-
tries. such as France and England
have been placed in a position or Try
ing 10 keep funds on hand TO care l"i
their own requirements without us
turbing their legitimate reserves or m
dustrial progress. This active self
preservation has in itself demonstrated
the extended position of banking ins1-
tutions which, are beyond the line OF
easy money into a field Of loan contrac-
ton. which means readJustmeht re-
curing time 10 exhaust itself before
the world may be said again to be IN Il
thoroughly healthy financial condition
In the United States prior to inc
war disturbances in Europe there was
decided recovery in trade and lndus-
try exhibited and an ample supply Oh
money seemed to be available to care
for all requirements, but Europe mas
been drawing on us for gold, and since
the first Of the year has taken about
500. .OOO,OOD in the yellow metal tr'"n
New York. which, with other with
drawals, has depleted our money sup
ply. and the worst Of it is that the end
Of these requirements OF foreign couh-
tries is lot over. France has Deell,
adding TO her gold supply by paying
high prices in this market, and France
to-day is in the best financial position
of any country on the globe
The importation of gold by France at
this time is not the result of any m
debtedness to France, but because ths
Bank of France is piling up a reserve
OF yellow metal and paying a pre-
MUM 10 secure IL in expectation oil
higher rates on loans 10 be made later.
The Bank Of France can import gold
at a loss because IT does not have 10
pay il out, but can keep ii in its :e-
serves. The country is operated on a
bimetallic basis and has the option OF
redeeming it's notes in silver, winch
option il exercises 10 preserve its
stock Of gold. The Bank of England,
however. is compelled by law to pay m
gold without a limit, and in order to
preserve its stock OF gold the bank
raises it's discount rate TO attract gold
and make money higher in London
than in other places.
In the minds Of many people why we
should export gold to Europe in view
Of the trade balance for 1872, which
amounted TO JO0,OOo.oD in our favor.
is a question they cannot answer. But
there are many items which enter into
the trade relations Of the Old and the
New worlds which are not exhibited in
the official figures Of trade balance.
These figures account for only the
visible balance dealing with the COM
modities which we export and import
Entering into the actual balance. but
not visible. are the dividends and inter
est on the securities held abroad, the
dowries Of American girls who nave
married foreign noblemen, the money
paid for freight 10 foreign ships. which
carry practically all shipments to and
from this country: the premiums paid
TO foreign insurance companies, I'M
mense sums paid for importations OF
art objects. hundreds Of millions paid
bv American travellers. who annually
snend much of their time travelling
through Europe; the funds taken by
expatriated Americans. such as Will
lam Waldorf Astor, who continue 70
live abroad. but own immense paying
nropertv interests in this country, and
remittances Of foreigners who send
their savings back TO their mother
countries.
II is estimated that $3J00OO,Ooo an
nualIv is paid TO other countries for
interest on foreign capital invested on
this side. that $3OO0co.Ooo Is expended
nv travellers each year in Europe that
5000 100000 is paid out In freight
rates TO foreign vessels. SlO,OoOVO
is expended by Americans VINO i've
abroad and that fully SJDp.voVo Is
RENTED each year by the foreigners
who come TO this country, earn their
money and send it back home. When
this vast total is taken into considera-
ton il is easy to understand how the
United States is not the creditor ma
tion and has not the favorable Dalahce
~ trade that the official figures Of the
government indicate. II the Cnlted
States has been piling up big balance
as the figures have suggested IN the
past. her wealth to-day would be be-
yond expression and some other coun-
riesSould be bankrupt. Great Britain
for instance. is big importer. the total
imports Of commodities exceeding her
total exports by hundreds OF millions OF
dollars. yet Great Britain is rlch
country and a big creditor nation.
m IN