Carson City daily appeal. [volume] (Carson City, Nev.) 1907-1930, 1915-08-16

(By Joseph French Johnson, T. c. S, IL. D, Dean, New York Uni
versity School of Commerce, Accounts and Finance)
The European war will probably cost the people OF the United States
several hundred millions of dollars. We shall pay the bills, as it We're
unconscious1y. And w c cannot evade the cost 10y keeping ut OF tn
conflict.
The first of the "a is ended and Europe has spent, in
direct var costs, about twenty billion dollars. Add to this IL the
many other billions that have been destroyed or lost through s1ackened
production, and you get a sum greater than any mar ever dreamed could
be destroyed in so short a time.
The benigerent nations are raising the funds necessary to prosecute
the war through increased taxes and through enormous public loans.
With their productive agencies crippled they have not been able to
realize much from taxation. The loans have been made for the most
ing bonds or short time treasury notes. Some OF the great central banks
of Europe have more than doubled their paper circulation.
During the last three months, England alone foated a three billion
dollar loan. Russia, Germany and France have been punging into deot
on the san grand scale. Before the war is over and paid for there
will be imposed upon the shoulders of each la woman and child living
in beigerent countries a debt Of from fifty to three hundred and fifty
dollars. At the same time their barns and factories will be burned, tncir
best artisans killed, and their fields and vineyards torn with ruts and
trenches.
1t is clear that they cannot buy from us as much as they have in
the past and that they cannot produce and sell to us, so cheap'y as
before, the things we have been accustomed to buy from them.
Furthermore. Europe will not be able to provide us with capital for
the development of II industries to the same extent as before the war
In fact, she may quit sending us ley capital and actually demand tha
we pay back what W e owe, or even ask rs to begin lending to her.
Our present debt 10 Europe has been estimated at five or six billions
Will Europeans val is to pay that back when it falls due, or will hey
prefer to retain their claims against a people hat Will IN all prooaohV
be more prosperous than any other?
The governments of Europe are bidding high to attract that capital
way from us and they will bid higher still as the war goes II. The
last British loan a sold to yield AZ per cen to the investor, other
nations are paying as much and even more in some cases. Some OF
them are sound beyond doubt. AS a cold business proposition o both
sides it will be hard for our railroads and industrial corporations to conf
pete with such a interest rate as that, especially when they have to
fear government persecution at home. But it is not a cold business
oropositon The nations of Europe will add to the attractive rate OF
their loans n appeal to the patriotism and pride OF their people.
believe they will be able to secur a large proportion OF the avail
able capital in Europe and that they will pull away IRON us a large part
Of what W e have borrowed, unless we are willing o pay a much higher
rate of interest than in the past when the renewal date comes.
Then Europe will probably succeed in inducing American capitalists
to invest over there.