Albuquerque morning journal., 1914-10-31
CREDIT LOANS To
BELL|GE RENTS
NOT OPPOSED
Germany and Russia to Es-
tabIish Purchasing Balance
in American Banks Similar
10 That Of France,

faN NoHFlNo JOURNAL SPECIAL ttfseo WISE
washington. oct 80. - Viewing
credit loans 10 bellgercnt countries
ne private transactions. the Washing
ton administration will not attempt to
lnterpose it's influence against such
transactions on the part Of the Amer
lean bankers.
This was learned on the highest
authority today. after II became
known that German finaneiers were
contemplating the establishment of a
credit loan in this country, similar %
the $4,000, 600 credit fund negotiated
by the National City Bank Of New
York and other bankers for the
French government.
The decision Of the Washington ad-
ministration may lead to the pur-
chase in the United states of about
$50. 10000 worth of supplies by Rus
sla, and an equal If not a greater
amount by Germany Details OF the
expected transactions are lacking
here
High officials of the Washington
administration insist that President
Wilson has not changed his view, an
nouncod at the outbreak Of the war,
that the loanlng Of money to bellig-
erents would be inconsistent with
the true spirit Of American neutral
ity." A distinction was drawn up by
officials, however. between the loans
referred to at that time-such as bond
issues offered for public sale-and
credit transactions intended as 4
checking account against the pur-
chase by belligerents OF foodstuffs and
supplies from American firms.
The president realized that this
government has no legal right TO op-
pose loans OF any character. nor is
there any obligation Of international
law forbidding them During the
Russo-Japanese war loans were float
ed for Japan in the United states
through public bond issues. The presl-
dent Is understood, however, to be
opposed to that form Of loan as Liable
to stir up III feeling.
No Further Discussion.
Officials nave unanimously decided
of loans as the position Of the gov
ernment in the circumstances Is an
embarrassing one When J P Nor
gan & Co asked the opinion of the
state department several months ago
as to whether the administration
would approve of loan to France.
the Washington government express
ed itself against it.
Bankers. however. are not obliged
to ask the advice of the Washington
administration and they are at Just as
much liberty to engage In credit leans
as American ammunition Trims or
horse dealers are permitted TO md
munitions Of war and horses to bel
ligerent armies The American gov
ernment is under no obligation to pre-
vent their shipment, nor has Il any
power under the laws Of the United
states to prevent commerce in CON
traband. The burden rests In sucn
cases on the belligerents affected, VINO
can seize contraband. including ear
goes of gold on the high seas If he
stined to belligerent ports
No Intention TO Export toiu
Under what is known as cred t
loans there is no intention. it is un-
derstood, to export any gold from the
United States Large funds viii be
established by the belligerent coun-
tries with their financial agents hero,
who will pay the bill of the European
nations to American dealers in munl-
tioons Of war and supplies The bank
ers will be given short time notes
by the belllgerent governments with
a much better rate of interest Il is
said. than ordinarily could be OBJ
tanned In return for these consid-
erations European governments will
agree to spend large sums OF money
in the United States for supplies.