Daily capital journal. (Salem, Oregon) 1903-1919, 1915-07-28


How will some OF the 0e.lsefen''
pay Tor the enormous wa, supplies
bought IN the United states' This Is
the problem Of tha future la American
financial circles. Orders thus lar re-
reiyed already aggregate over one hn-
lion Of dollars. and hundreds Of m.i.
lions more are practically sure 10 '''
low; for peace Is not yet 10 sight ana
the war has by no mean. reached ITS
greatest intensity Pr1ghostigau9.r.l'
are futile; yet il IS more than ptopaoie
that the problam Of financing the war
has not reached the real crisis OF 'e''
and an increasing waste OF liie ana
property must be expected as ihe sif'l.
gle grows in bitterness and destructive.
ness. II goes without saying that some
of the warning nations who are d'f'.t.
y Or indirectly purchasing war mate
rials here can not pay cash 20 an.
extent, because they are evidently
spending several times their national
savings IN prosecution Of the war
Treasury notes can only be used 70 a
limited extent, and long term credit
obligations will be the only basis on
which these orders can be- financed, be-
cause an indefinite period must eIapse
before Europe can again send us sum
cient merchandise or gold 10 even aP
pF0xlmately balance our exports G0ld
we DO not absolutely need. and Europe
cannot spare II in large enough amounts.
Thus far, Europe has returned us be
tween four 10 five hundred millions OF
our securities; but European indebted.
ness 10 American manufacturers will
increase on an enormous scale during
the next six mWihs, and the foreign
exchange situation will be- one demand
ing the highest skill and re,ourceful'
ness for solution. Foreign holders
especially British. seem unwilling to
part with their American investments
10 would seem, however, as If o partial
solution will be the sending back TO this
country Of a still larger portion Of their
holdings in Americans The Canadian
tlj,OOO,OOO per cent loan which will.
probably be promptly subscribed, will
also help the situation.
The United States /. the only i'm.
portant nation in the world that is now
accumulating capital from 10, savings
II Is also the only free investment mar.
kei ia the wWld, since all the great
powers Of Europe are pouring their
savings and energies into the wrctchel
melting pot Of war There are no in..
dlratious, however as yet, Of American
disposition to buy foreign government
bends with any freedom. 4 fair
amount might be absorbed hy institu.
lions and trust fund. here, especially
II terms were made stll more attrac.
tive; but the amount would be- relative.
Is small when compared with the many
billions already issued abroad II. then.
American manufacturers are To- continue
accepting muuitiou contracts. some very
extensive credits Bi'l have 10 be- Ar.
ranged for by American bankers. aud
these credits W short term obligations,
whatever they may be-, will eventually
have 10 bo extended or turned INTO
hNoi drh, ,u some form II is we'll
therefore, 10 kp1p lu mind AS to what
would Dee the effect Of this immense
mas, Of foreign credits upon American
finances, especially ir Wow of the fact
mat the market tor these foreign ob
hgltlons ON this side will necessarily
Doe limited az course, the credits thus
i1r granted have imposed uu fwaurial
strain here and they could undoubtedly
he greatly .ypauicd without harm. but
"a new factor Of great Importance ls
hung introduced INTO our finances. one
with which American bankers and u.