New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-08-15
j. s. WILL PASS
ON FRENCH LOAN
Government Advice Asked
by J. P. Morgan & Co.
for Guidance.
NO FORMAL REQUEST
RECEIVED FOR SUM
Protest Against $100,000,000
Fund to Aid War Sent to
Secretary McAdoO.

J. p. Morgan & Co. issued formal
statement yesterday announcing its
position in the matter Of placing loan
here for France. In substance the firm
says that it has been asked by indi-
viduals if it would consider placing a
S100,OO0,00O loan, the money to remain
in this country and be drawn against
for goods that it had not decided
whether or not it would do so, and in
asking the government at Washington
for its advice in the matter it merely
wished to know the exact position Of
the administration, so that it might act
promptly if, and when, formal re-
quest to place loan is made.
Though the names of the indi-
viduals asking the information are with
held, it is generally understood that
the request comes through the Paris
house of Morgan, Harjes e. Co. and the
London house of Morgan, Grenfell &
Co., which, though distinct firms, are
in effect part of the New York house OF
j. p. Morgan g. Co.
There is precedent for the placing o.
a foreign loan here in time Of war 70
one of the belligerents, the case being
that of the japanese loan which Kuhn,
Loeb e. Co. foated when that country
was at war. In that case no objection
was raised, though by the terms of the
loan gold, which is contraband OF war,
was placed to the credit of the imperial
Japanese treasury in London.
Bankers yesterday said their. lawyers
had advised them that the underwriting
of foreign loans was no violation OF
neutrality, but that il was quite pos
sible Washington would prefer that
none be placed here.
Banking circles are not agreed as to
the desirability of placing a French
war loan here, because there is con-
siderable element that has strong Ger
man connections and is at bottom
strongly pro-German, and there is an
other element which is opposed to
doing anything that may even in
directly help Russia on account OF Its
treatment of its Jewish subjects.
Nobody connected with the firm OF
J. p. Morgan g. Co. yesterday would
discuss the terms of French loan If
issued, but there is no doubt that the
terms offered for money would make
the issue, even in these times, an at
tractive one TO investors.
Loan Would Help Trade.
In commercial and shipping circles
il was pointed out that the establish
ment of loan such as Morgan & Co.
NAV issue would greatly aid IN placing
American products abroad. There is
no doubt that Europe will have to come
10 these markets for much OF their sup
niles that in ordinary times would be
produced at home or in other countries,
but il was pointed out that the coun-
try which will get the bulk of the
business is that which makes It castles:
for the combatants to secure their
goods.
The Morgan statement is as follows:
ave have not been asked by the
Froncb government to make loan, but
we have been approached by private in
terests to know whether VIC would en-
tertain negotiating a loan for the
French government in case the govern
ment should desire such loan. II was
stated 10 US that if the loan should be
made, il would be for the purpose OF
creating a credit in the United States,
the proceeds Of which would be used
to buy American products for the
French people, and that no part OF the
credit would be used for gold exports.
Immediately upon receipt OF this in
ouiry, we communicated the fact 10 the
State Department, saying that we were
not at all clear that, If asked, we should
desire 10 negotiate the loan, but that IN
any event we would not give the mat
ter consideration without first ac-
the department with the
facts and ascertaining their attitude in
regard 10 foreign loans at this time.
ave advised them that, irrespective
of any legal right TO loan TO belliger-
ents, we should not care 10 consider
the subject IL the administration
should have the slightest doubt in the
matter. We have not as vet been sd-
vised of the attitude of the department
and can quite understand that possibly
they NAV desire TO refrain from ex-
pressing any opinion.
No Plans for Future.
"If they should express no opinion.
we shall be governed entirely by the
interests of the general situation as we
see them, should an application be
made for the loan. which is not yet the
case"
A protest against the proposed $780,
000, 900 loan TO France was sent 10 the
Of the Treasury yesterday
by Louis w. Fehr. secretary of the