New Britain herald., 1914-08-05
WILL MAKE EUROPE
 PAY CASH DOWN
SIX Men VIII Carry Out Trade
 Campaign for Bankers.

New York, Aug. 5.-The foreign
 exchange bankers who have been
 meeting daily at the Guaranty Trust
 company since last Saturday to de-
 wise means of bringing relief to the
 chaotic exchange market voted yes-
 terday for the appointment of a nom
 mating committee of three to des-
 ignate a committee of six the latter
 to act as sort of directing board
 and to plan a campaign of action for
 the whole number.
 August Ulrich, of Ladenburg, Tha1-
 mann & Co.,, crairman of the meet
 ing, named Max May, vice-president
 of the Guaranty Trust company: l Jerome J. Hanauer, of Kuhn, Loeb
 & Co.,, and R. z. Hebden, agent of
 the Bank of Montreal, to select the
 larger committee.
 Committee of Six.
 The committee of six is to be made up to representatives of some of the l most important institutions in the l foreign exchange business, presum- 1 a ply with the power to act with au- 1 thority for the companies and firms l of which they are officers or mem- 1 bers Its personnel was not dis
 closed last night but among the prob l able members are Max May, repre-
 senting the Guaranty Trust company;
 John E. Gardin, vice. president of the
 National City Bank; some one of the , partners of Kuhn, Loeb & Co.,, and a l representa- tive of the Hanover Nation | al Bank.
 One of the most important matters | with which the committee will have 1 to deal ise the question of how cotton I and grain are to exported to Europe
 at this time, when the ocean is almost l bare of merchant ships and the rail-
 roads are finding it necessary to place | an imbargo on interior points on all
 shipments intended for export in or 1 der to prevent congestion of their 1 terminals at the seaboard.
 1 Max May Explains. 1 Another matter is to arrange for a
 way in which American exporters can | receive pay for their shipments and
 American importers can meet their 1 foreign debts. Max May said after
 the meeting yesterday:
 l We are compelled to make a com- plete change in the method of hand : ling foreign exchange in this country. 1 Heretofore, Americans have purchased 1 documentary bills of exchange and l have taken the risk of regarding the carrying out of the shipment and the payment of the bills of exchange. l Now, we shall require the govern 1 ment of England or France or Ger
 many, as the case may be. to take the | risk on the shipments and the pay I ment of the exchange.
 Must Deposit Money.
 "If England wants grain or any
 other commodity, she will have to de-
 rosit money with the Bank of England
 to the credit of the London repre- 1 sentative of the American banker,
 and the English consigneetw Twill have to l take the risk of the arrival of the con-
 sjgnment. In other words, England O. l France or Germany will have to de-
 posit money in advance of the ship
 ments. With this money deposited, we will be able to draw bills of ex- i change on our London branch and get i our money, and the risk in the ship 1 ments, so fa1Fas New York bankers
 and producers are concerned, will he ] eliminated.
 I Foreign exchange cannot be con- 1 ducted, when countries are at war, in 1 the same fashion as when countries are at peace. The position is that | England and the Continent want our l grain, our cotton and our comm modi- | ties, and that it is only a matter of prudence that we require payment in l advance an dthe government guaran- 1 tee of the delivery of the ship 1 ments.'
 Will Stay Here.
 The gold which was brought back to l the United States by the kronprinzes- l sin Cecile, said MT. May, will stay l here and be redeposited in the sub- l treasury to the credit of the banks 1 which made the shipm ents. Now tn tt ! foreign exchange transactions are to 1 be placed on a war basis, the ship 1 ment of this gold abroad is out of l the question.
 l Later some of the bankers who have 1 consignments on the Cecilie said they 1 might put their share of the gold 1 either in the vaults of the Clearing l House or keep it at their own offices Discussing the whole situation yes
 terday afternoon, we'll known bank
 CT said he thought the recent esti- 1 mates of about SS5,0O0,000 on the l amount of foreign credits accum ula ted l here in the last two weeks, through l the sale of securities on the Stock EX- f~13 hn r.al1 of 1,o,, 1,I