New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1915-05-03
BRITISH AND GERMAN FINANCE
Reasons for Believing That England {
Standing Is Vastly the Stronger.

To the Editor of The Tribune
Sir: The review of Germany's financial
condition by DR.. Karl Helferich, German I'm
perial Secretary of the Treasury, recently
given out by the German Information Ser
vice here, in which he declares that the fnan-
cial position of his country Is superior in
every way to that of England and her allies,
is so wilfully misleading that it seems only
fair that Americans should read a few I'M
disputed facts and then judge for them
selves as regards the accuracy Of DR.. Helf-
ferich's statements.
say "wilfully misleading" because, al
though DR.. Helfferich is not tyro in finance,
his long experience as one of the head man
ayers of the Deutsche Bank must have
taught him something, and his remarks there
fore cannot be attributed to ignorance.
1t does not require more than an ele-
mentary knowledge of foreign finance to ap-
preciate the falsity of the statement that
Germany is in better position financially
than England Authorities on the subject
ridicule these assertions, and believe that
The only object in circulating them broadcast
is to attract subscriptions to new war loans
by convincing the uninitiated OF Germany s
"soundness."
DR.. Helfferichs statement that German
credit is superior to that of England must
strike any one as ludicrous when COMPARE
sons are made of rates at which the differ
ent countries can borrow-the only way to
ascertain a nations standard of credit. All
the war loans put out by the German gov
eminent since the war began have only been
successful because the interest rates were at
per cent and more. England's war loans
have all been we'll oversubscribed at rates
ranging from to per cent None can dis
pute these figures, which are in themselves
complete refutation of DR.. Helfferich's
statement as regards superior German
credits"
The Secretary refers to the Glow gold
stock" in the Bank of England as the weak
point in England's financial armament" The
Bank of England's gold holdings to-day are
S1OO,0OoO00 more than they were at the end
Of July, and this increase has been brought
about wholly by the ordinary and legitimate
operations of commerce because Of her posi-
ton as creditor nation and because Of her
control of the seas. Germany, however, has
used most extraordinary methods to bring
about the extremely heavy increases in her
gold supply. Circulars have been distributed
in a wholesale manner pleading with the
people to exchange their gold for paper
money, and it is common knowledge that no
one has been allowed to leave the country
without first being deprived of his gold coins
Note circulation in Germany has increased
800 per cent since the war started, and the
gold cover" for this is only about IS per
cent. In other words, for every IS in notes
Germany can only show gold to the value OF
1925. Englands gold circulation has in
creased only very moderately, but she is able
to show So In gold for every SIS in notes.
Moreover, evidences accumulate TO show that
huge amount Of German legal tender notes
have not a vestlge Of gold cover. That is
why German notes are at big discount in
every foreign country, Notwithstanding the
governments shipments Of gold to neutral
countries in order to try to rectify the ex-
change.
In America the depreciation in German
currency is about 10 per cent. 1t is true
British currency here is also at discount,
but that is due almost entirely to the pur-
chase Of enormous war supplies in America.
In every other foreign country, however,
English currency is at q premium.
German-Americans are no doubt satisfied to
accept the statements Of their ministers
without question, and the average German
in his own country is equally confident that
the facts are not misstated but for neutral
Americans the situation is entirely different,
and to them the true situation should make
powerful appeal.
If the financial situations Of England and
Germany are studied carefully by an out
slider the only conclusion he can possibly
reach is that England's standing Is vastly
superior In every way to that Of Germany.
BENSON G. II. DURANT.
New York, April Is, 1915