The West Virginian. [volume] (Fairmont, W. Va.) 1914-1974, 1916-01-22

81.
This depreciation Of the crown, in
some cases nea:ly 40 per cent. would
be a serious matter for Austria. Hun
gary were the causes OF an economic
nature related to peace, instead OF
wartime conditions. The Anstro Hun
garian crown Is low for the reason
that the paper currency Of the country,
based principally on the national gold
reserve, is being deprived OF its base
by the many purchases the country
has made in foreign markets for which
the actual metal, gold, had to be ex-
change. With her allies, Austria Hun.
gary still trades on the normal basis
of credit, resting on an exchange OF
merchandise but in buying from neu-
trails and through neutrals from the
enemy even, nothing but the actual
transfer Of gold suff1ces. So far Aus.
tria Hungary has been obliged to de-
plete her national gold stock and re.
serve to exactly what the average OF
depreciation of the crown indicates,
roughly speaking 20 per cent.
The case is analogous to that of
Great Britain in her trade relations
with the United States. After having
realized as much credit as possible
by transfer to American holders of
much commercial paper owned In
Great Britain, the value of the pound
sterling is being kept up by ship
ping specie to New York. Austria Hun
gary has been doing the same thing,
though not with the same success be-
cause her gold reserve was never near
ly as great as that of Great Britain.
The exchange in the Austrian minis
try of finance, made day before yes.
terday, Is directly related to the prob
lem OF lettering the standing Of the
crown. OF the work towardslthis end,
the limitations Of imports for which
gold must be surrendered will be an
important part. At the outbreak Of
the war not enough attention was Civ.
this, It Is said. A stiffening up by Aus
trian banks would have kept much
gold in the country, but this would
have taken, a financial organization
which Austria did not have. The;new
minister of finance, DR.. Leth, is looked
upon as the man who will supply this.
Having successfully managed for
years the Austrian postal savings in
stitution, foated a number of large
Austrian loans In the United States,
England and France, and recently
managed the three war loans which
the country has raised, he has not
only the confidence OF his own peo-
Pile but also o high standing in for.
eign money markets, it Is said.
Just what tactics he will employ
is still unknown, but 1t is expected
that one Of his first moves will be to
close the Austrian border to foreign
shipments for which specie is demand
ed. In this way supply" would be-
come more eager for business than
demand" In other words the foreign
seller would find the Austrian buyer
less inclined to do business on a gold
exchange" basis. Hand IN hand with
this would have to go partial reor.
ganiZation Of the country's commerce
and industry. The recent change has
placed very capable man at the head
Of the Austrian ministry of commerce,
and the first essentials for the work to
be done have thus been secured, 1t Is
thought.
What ever the other details Of the
program may be, one thing is certain,
and that Is that the new chiefs OF fin.
ance and commerce will strive to
make Austria and, by cooperation
with, and on the part Of, the Hun
garian government, Hungary, more
econmically self.contained than they
have shown themselves in the course
OF the war. BY doing this the gold
stock will be kept in the country, and
the demand for foreign money and
credit will be decreased to such an ex.
tent that further depreciation of
Austro Hungarian paper will he ward
ed of. Since the dual monarchy is
financially sound internally as the rails.
ing Of the third war loan has shown,
the task is one which few remedial
measures OF the nature indicated
above will meet, according to the
Judgment Of interested circles.