Arizona republican., 1916-12-02
Republican A. p. Leased Wirel

NEW YORK, Dec. l.-The abandon ment by J. P. Morgan and company of the proposed sale of limited amount of short term British and French treasury bills at the request cf the entente allied governments, announced nere toGay, came as a sur prise to the financial community. The announcement, issued from the Nor gan offices, stated that the action of the British and French governments was taken out of regard for the at titude adopted against the sale by the federal reserve board. The sur prise was heightened by the fact that all arrangements for the offering had heen perfected.
 Other plans to finance the pressing needs of the British and French gov errments already are under way 1t is understood. but they have not yet reached a definite stage. member of the Morgan firm informally stated that no other plans had been formu- lated, but 1t was learned from reliable sources that the denial had been made as a matter of policy. The plans un- der contemplation. it is intimated. will involve large amount of dollar credits" available to Great Britain if not to her chief ally.
 British institutions and private in- vestors still retain large amounts of American securities although they have been largely motilizcd by the British treasury. There have been no cancellations of orders for war sup plies or any other materials to the countries of the entente allies, ac cording to the bankers acting for those interests and no diminution of orders is expected
 The British government continues To hold large reserves of gold in Canada and the more remote colonies. and these reserves. it is believed. will be employed to meet immediate exigencies including stabilization of exchange.
 The announcement was contained in the following statement:
 We have been instructed by the British and French governments to withdraw their treasury bills from sale
 "We have accordingly expressed to those institutions and investors which had already placed orders with us for these securities the wish tO be re- lea sed from the obligations to deliver and they have been good enough to accede.
 This action is because as explained hy the British chancellor of tfe eN- chequer and by the French minister of finance. these governments desire to show every regard to the federal reserve board. governmental body of which the secretary of the treasury and the comptroller of the currency gre ex-officio members.
 We may add that the sale of 9 limited amount of these treasury bills payable in dollars in New York have never been an essential rart Of the allied governments financial plans but have for some time been under con- alteration with a view to furnishing a credit medium that would accom- modate the American banking de- mands for an instrument of sfort ma turity and of such limited volume that the government could always un- dertake to lay down gold in New York sufficient to meet the maturei hills
 "I, was believed further that these hills would have furnished al the end of the war an excellent measure of protection to the American financi7l situation inasmuch ss these steadily maturing obligations of the foreign governments would have tended to prevent heavy drafts Of gold from this market"