Richmond times-dispatch. [volume] (Richmond, Va.) 1914-current, 1915-08-17
AMERICAN DOLLAR
IS RULER OF WORLD
London No Longer in Control
of Treasure Chests of
Nations.
EXCHANGE IS DEMORALIzED
New Depths Reached in Tor
rent of Bills Poured In by
Manufacturers.

NEW YORK, August 15.-The Ameri-
day with an iron grip. Pounds sterling.
francs, lires. virtually all foreign ex-
change. went down to new depths in a
torrent Of bills that poured into the ex-
change markets from American manu-
facturers seeking pay for the big war
contracts of munitions and other sup
plies purchased here by the warning
nations of Europe.
Coincident with the sterling decline
in exchange rates came the assertion
from an unimpeachable source that
every contract made by the American
manufacturers for the supplies sent
abroad called for payment in American
dollars. and not English pounds ster-
ling. which heretofore had been the
standard of finance the world over
The immense losses therefore, due to
the decline in foreign exchange rates,
will be borne TO the last penny by the
foreign buyers. and will not be sus-
tanned by the American manufacturers
EXCHANGE SITUATION
CONSIDERED BY BANKERS
The maximum depreciation to-day in
pounds sterling was ga per cent below
normal in francs. 10 per cent below
normal: in Italian lires. % per cent.
The pound sold a I one time to-day for
only s46i; 6.2 francs cqualed 81. and
81 purchased 64S lres In the last
hour OF the business day. however, tho
appearance in Wall Street OF ]. p Nor
gan. for the first time since the attack
on his life six weeks ago. and an in
formal conference of bankers to con-
slider the exchange situation sent rates
upward
Sterling closed at 4.s7la. one-half
point higher than it opened and "A point
and half under Saturdays close,
which established n new low record at
the time. Francs gained three points
over the low record, selling at 5.9e at
the close. and lires rebounded a point.
closing at 6.47
"ha, TO do to remedy the situation
engaged the attention of bankers with
international connections at the con-
ference late to-day. 1t was decided
10 do nothing. chiefly because the
remedy lay with the foreign buyers.
who Will be the sufferers
SALE OF SECURITIES
IS REMEDY SUGGESTED
One remedy suggested was to sell
American securities held abroad, but
when this contingency was studied the
situation seemed to be pregnant with
unknown possibilities. Millions of
American securities payable in dollars
are held abroad. chiefly high-class rail-
road bonds and preferred stock of 3:
selected list OF American industrials
Should these be- sold at present they
would bring far more than the pur-
chasers paid for them. due entirely to
the depression OF exchange.
With the prospective profits as an in
ducemcnt. ii was believed that holders
abroad would be willing to sell. and
that foreign buyers of American goods
would have little difficulty in procur-
ing large amount Of American securi-
ties abroad as collateral for tenn
porary loan in this country. which
would tend to correct exchange rates
The establishment here of n big for
eign credit, estimated conscrvatively
at s500.000,o 900. was thought 10 be alb
solutely necessary i exchange rates
were to be restored 70 anything like
normal.
The assertion that dollars and not
pounds sterling. had been the nancial
standard on which contracts for war
supplies had been accepted came as Il
distinct surprise. Aside from marking
the temporary passing of London's
control of the worlds treasure chests,
II relieved the anxiety of investors in
war specialties in the stock market.
who were confronted with the prospect
of large shrinkage in prospective
profits. due TO prevailing exchange
rates.
1t was learned that the amount OF
war contracts on which full or nearly
full payments will be due on October
approXim mated $4,000 900 to $500
100000. This is in addition to tho
huge total of more than $1,000, 900, 900
owed by Europe to the United States at
the close OF the fiscal year June 30.
1t was also learned that tho prospective
profits of some of these contracts had
been greatly exaggerated, and that only
normal profits would accrue.
This, 1t was said. was due 10 tho
rigid surveillance OF British INSPECTORS
over all deliveries. Goods contracted
for. 1t was said, that did not come ND
to rigid standard were rejected. en-
failing loss.
Another optimistic influence was the
general belief that second large gold
shipment was on it's way to New York.
Approximately s2O.o0o.o00 in gold coin
reached here last week from London.
Wall Street heard to-day that the
second shipment was coming from
South Africa or Australia
BRITAIN MAY PLACE
RIG EnnErrN yo.>-s