The Birmingham age-herald., 1915-01-21
World Wide Financing


 This movement is reflected in some very important worldwide financing winch is now in progress and also in the expecta- ton that during that year financing by the United States on account of other na- tions will continue in larger and larger amounts. At the end of 1914 it was pos- sible to report that the United States had assisted other nations, directly and indi- rectly, by funds and credit amounting to about s1O0,0OO,O00. So competent an au- thoiity as Max May has felt free to say that we have done this while at the same time We paid off obligation on current account, including payment of New York city notes held in Europe aggregating about $2O0.000.000. These are transactions which even in the palmiest days of Lon don's financial activity would have been regarded as national events of the utmost consequence.
 Some time in the course of the year it is probable that the United States will facilitate the marketing of Canadian loan aggregating $100 0000, 600. Probably this will not be done in the customary way namely, by American bankers accepting national loan of Canada. The attitude of the administration at Washington seems to be that the United States can not finance national obligation of a bel ligerent nation without violating the spirit of neutrality. Although this is new doc Urine. nevertheless American bankers do not intend to do anything which would call Tor criticism from Washington But there are excellent facilities by means of which Canada can be furnished with this money, the capital coming from the United States without the transaction talk ing the form of a Dominion loan.
 IL cannot have been forgotten that some time in the fall the administra ton at Washington intimated to certain bankers oi New York city that it would not look With Iavor upon the negotiations of A frehcn national loan by American bank CTS giving as reason for that feeling US belief that the transa ction would vio- late the true spirit of neutrality. The bankers yielded instantly to this view of the aoninistfation. But there were other ways oi eiVing nnanc1al assistance to the nations across the sea without negotiat ing their national securities. One of thesa ways is illustrated by the means adopted Tor enabling Russia to obtain A credit here, perhaps as much as 05. .O0O. .O00 cer- tainly as much as $12.500, 900. The transec- tion will not take the form of a national loan. Instead it is to be purely q bank CTS transaction. Technically the trans action Will consist of the acceptance by American bankers of Russian drafts These drafts, having been accepted or in, dorsed by American bankers, will then be sold to anybody who wants to buy them That is not a national loan nor is 1t in any sense a loan to a belligerent nation The bankers buy short-time drafts, guar antee them and then offer them for sale to the pubic. That transaction of this Find is not regarded as worthy of crtti- cism by the federal government is shown by the fact that the federal reserve board at Washington approves the rediscountinr or these drafts by the federal reserve banks.
 Use of Russian Credits
 NO doubt greater part of this credit which Russia has negotiated here will be utilized in paying for American commod- lues bought for that country. Those who are best informed of the conditions in hussla believe that after the war Is ended Russia will be the heaviest purchaser of American commodities of all the foreign nations. In addition to Russia, Japan, which Is belligerent nation, has nego- tiated large credits here as has also Italy. There are two aspects in which these nnencfal transactions are viewed. One 10 the certainty that these funds are to be used chiefly for the purchase of Amer ican commodities. and what that will mean to American business Is not ncces- sary to set forth. The other view Is that which reflects the new attitude which inc United States has taken with regard to international financing Of | kind v,htch covers the entiro Globo.