Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1915-09-01
MAMMOTH EXPORT
TRADE |MPERILED
Alarming Drop in Foreign Ex-
change Rates, Notably in
Pound Sterling.
BREAK WITHOUT PRECEDENT
Cancellation Of Orders May Fol-
low-New York Bankers
Suggest Remedy.
BREAK WITHOUT PRECEDENT

NEW YORK, August 31.-The tre-
mendous export trade of the United
States. in which this country leads the
world for the first time. was impcriled
to dag by an alarming drop in foreign
exchange rates. notably sterling.
AT the close Of business the English
pound was worth only s4.55h I'm Ameri-
can money. This Is a drop from it's
normal valu" of 31a. cents. from it's
value or August of "a and from its
quotation of last night ga a twenty
our-hour break without precedent II
marked the lowest value Yet recorded
III an excited market where every day
recently has set new record Of de-
probation, and it indicated that sterling
was headed downward with Il momen-
tum that promised to take II TO levels
unthouEht of ten days ago.
i-lSLtt", face of this rapid depreciation.
bankers here were wondering tonight
how much longer Great Britain would
pay the premium and buy goods in this
market. when she can get similar goods
in other markets where the value of
her money is greater. They were of the
opinion that IL rates went much lower
cnncella ton of war orders for every
thing except what Great Britain can
not afford TO do without-powder and
shot. rifles and shra apnel, aeroplancs and
automobiles-would follow.
REASON AND REMEDY
SEEM CLEAR TO BANKERS
The reason and the remedy seemed
clear in the minds of international
bankers The English pound has be-
come dcpreciatcd they said, because
London has failed to provide method
here of paying the big bills now coming
due to American shippers The remedy
would be. they thought, TO establish.
quickly a mammoth credit loan in this
| market. America does not want British
gold to pay for supplies: on this point
opinion was unanimous. The vaults of
Wall Street and the banks in the in
terror already are choking with gold.
More gold would tend to create n pc
riod Of enormous imitation. What New
York bankers want TO do is TO lend
Great Britain an enormous sum Of
money to be spent in paying bills here
/ on approved collateral of high-class
I American railway and Industrial stocks
and bonds. That, II Is believed, would
! restore conditions to nearly normal.
| Apparently Great Britain intends to
adopt that course, but. officially, neither
/ Great Britain nor her inanciers has
/ given any inklng to bankers here of
what they intend to do
! When the deputation of British
! bankers reaches New York on its mis-
| sion to straighten the market they will
come with a plan. il was authoritativelv
said tonight, of which their associates
j in New York are wholly in ignorance
NOT COSTING AMERICAN
| MANUFACTURERS ONE CENT
| London has not awakened TO the full
! measure OF the situation, in the opin-
ion of most international bankers here.
| Tho tardiness of English bankers. it is
said. is being paid for in British gold
| at rates extremely dear. The deprecia-
| tion of the pound sterling 1t was en-
| phatically ascertained. is not costing
| American manufacturers one cent, for
| all bills payable by Great Britain here
are payable In dollars.
The only bright spot in the outlook
was the probability that the prevailing
| rates would persuade British holders
! Of American securities 10 part with
them now and reap the per cent profit
which thus would accrue. These Sc
curities are needed as collateral for the
contemplated British credit 1t is esti-
mated there are American securities
! now in Great Britain to the value of
$4,000. 900.
To what new levels exchange values
would plunge if all owed to follow
| their present tendency no man in Wall
| Street was prepared to say tonight
| The high .idc of foreign bills is on Its
way to New York now. BY the end OF
next month n food OF bills for cotton
| and wheat will dcluge the markcts
Never before within the memory Of
man have the foreign exchange market is
hecn so thoroughly demoralzed as to-
day. Rates tumbled. not by the usual
eights, but cent or more at time.
One big banking-house quoted n rate
on sterling TO n Havana bank shortly
before the market opened. BY the time
Havana could accept the rate was 5
cents lower.
SPECULATORS CATCH
SPIRIT OF EXCITEMENT
Spectators caught the spirit OF ex-
citement and added to the demoraliza-
tion. In some instances even messen-
gers and clerks pooled their interests
and sold sterling, figuring that they
could not lose.
a comparison of rates quoted to-day.
the last of AugustA with those that pre-
vailed August 2. the first business day
of the month, follows:
Sterling--to-day. $4.56N: August 2,
$4.76. Francs--to- day, 6.04; August @,
5.71. Lires--to-day, 6.54; August 2,
Gal. Rechmarks--to-day, S0h: Au-
gust 2, SIX.
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