Arizona republican., 1915-08-17
ENGLISH POUND NO
 LONGER STANDARD
Immense Losses Due to Decline of Foreign EN~ change Will Be Borne by
 Foreign Buyers, Not by
 American Manufacturers.
ASSOCIATED PRESS DIsPATcHl

NEW YORK, Aug. 16.-The Ameri - can dollar ruled the financial world today with -an iron grip. Pound Sterling. francs. fires, and virtually all foreign exchange went down to new depths in the torrent of bills that poured into the exchange mar kets from American manufacturers seeking pay for big war contracts for munitions and other supplies pur- chased here by the warning nations of Europe.
 Coincident with the startling de cline in exchange rates came the as ! .sertion from ar unimpeachaOIe source that every contract made with Amer ican manufacturers for supplies sent abroad called for payment in Ameri- can dollars and not in English pound sterling which heretofore has been the standard of finance the world over.
 The maximum depreciation in pound sterling was 4% per cent be- low normal. with trancs 19 per cent below and Italian fires 25 per cent below normal. In tke last hour the presence of J. P Morgan in Wall street for the first time since the attack on his life six weeks ago. and an informal conference of bar kers to consider the exchange situa tion sent the rates upward.
 Ire immense losses due to the de cline of foreign exchange will be borne to the last penny by foreign buyers and will not be sustained by
 
 exactly opposite to what has hereto fore been the popular belief What to do to remedy the situation has engaged the attention of bankers with international connections at an informal conference. It was decided to do. nothing. chiefly because the remedy lay across the ocean with the foreign buyers. They and not the American sellers are the suffer CTS. and theirs. it is the consensus of opinion. should be the task of setting the money markets to rights.
 How this is to be done is an ob- ject of keen consideration and some speculation. It is generally believed that the present abnormal situation will not be permitted to continue long. The obvious remedy seemed to be tO sell American securities held abroad. and when this contingency was studied the situation seemed pregnant with unique possibilities.
 \ great many millions of American securities, payable of course in doi- lars. when due. are held abroad chiefly in high class railroad bonds and preferred stock of a selected list of American industrials. Should these securities he sold at the pres cnt exchange rates in foreign mar kets they would fetch far more than the purchasers paid for them. due entirely to the depression in ex- change.
 Thus thousands of American bonds sold in Paris at par would. on ac- count of the prevailing exchange rate, bring approximately six thous- and francs When purchased at a par year ago. it cost the purchaser approximately 5.050 francs The net profit would be about $50 francs. or about nineteen per cent. the percen- tage of the depression in francs on the American exchange markets In London the profit would be approx imately A per cent and in Rome the profit would approximate 25 per cent
 With these prospective profits as an inducemcnt. it is believed the holders abroad will be willing to sec that the foreign buyers of American goods will have little difficulty in procuring a large amount of Ameri- can securities abroad as collateral for which would tend to correct the ex-