New Britain herald. [microfilm reel] (New Britain, Conn.) 1890-1976, 1915-08-17
European Buyers to Lose.

The maximum depreciation yester-
day in pounds sterling was 4 "a per
cent. below normal, in francs nineteen
per cent, in Italian lires twenty-five
per cent.
AS every contract made by Ameri-
can manufacturers for supplies sent
abroad calls for payment in dollars,
and not English sterling pounds, which
have been the standard of finance the
world over, the immense losses due to
the decline in foreign exchange rates
will be borne by the European buyers.
What to do to remedy the present
unprecedented situation engaged the
attention Of the bankers who attended
yesterdays conference. Among those
present were J. P. Morgan, H. p. Davi-
son, Frank A. Vanderlip, Charles H.
Sabin and Albert H. Wiggin. These
reiterated former assertions that as
the buyers of American goods are suf-
ferers by the depreciation in exchange,
it is up to their financial representa-
tives to present the remedy.
Not Continue Long.
It was generally believed, however
that the present abnormal situation
will not be permitted to continue long.
The two alternatives that have been
discussed most frequently are the pS-
tablishment here of huge loan or
credit estimated as high as $500. OOO,-
900, or the acquisition by England of a
large amount of American securities,
to be placed in this country as col
lateral for a temporary credit similar
to the one created recently by the
Rothschilds Of Paris for the French
government.
1t is estimated that the amount of
war contracts, payments for which will
be due before October /, approximates
between $500, 900 and 100000,
in addition to the huge total of more
than 81, 900, 100000 owed by Europe to
the United States at the close Of the
fiscal year June 80. 1t was stated that
the prospective profits on some Of
these contracts have been greatly ex-
aggerated. and that only normal
profits would accrue in a majority of
cases. This, it was said, has been due
to the rigid surveillance exercised by
inspectors of Great Britain and her al
lies over all deliveries.
More Gold on Way Here.
The most optimistic feature of the
foreign exchange situation yesterday
was the general belief that a second
large shipment of gold is on its way to
New York Approximately $20,000,-
900 reached here last week from Lon
DON Wall street heard that the next
shipment will be from South Africa or
Australia. One of the factors which
operated against a permanent display
of strength in yesterdays trading was
the delay in obtaining and executing
cable orders for securities. A case was
that of Union Pacific, which was down
three points in the London market,
while it made a net gain of three
eighths on the Stock Exchange.
Leading bankers are practically
unanimous in the opinion that Eng
land has failed to realize the fact that
she has lost control of the worlds
finances temporarily at least and that
by not establishing an adequate credit
here still clings to the delusion that
the pound sterling is the accepted
standard of international finance.
Unless definite steps are taken in
the near future bankers predict that
exchange on London and other Euro
pean money centers will continue
steadily downward. This tendency,
they say, will follow the continuation
of American exports in still larger
quantities with each week, due to the
completion of war contracts and the
shipments of grain and cotton from
this years crops.