Der Deutsche correspondent. [volume] (Baltimore, Md.) 1841-1918, 1916-10-07

material and immaterial assets to
foreign nations AS far as national
capital at home is concerned, Eng
land has been very chary Of investing
it permanently in war loans. She
has to finance her industries and her
trade on the vastly increased scale of
war boom So she had to borrow
money by floating loans in which
business men can invest capital tenn
porarily. Her people have been
called a nation of shopkeepers; they
must keep their shops going in war
time. That is the inherent dlficulty
of British war finance England has
to run her and her Allies business
and to finance the war at the same
time. There is not enough capital
even in wealthy England TO do that
easily. Floating loans had to be re-
sorted to, the rates of interest have
been rising continually. Even bor-
rowing abroad has not helped much.
Her imports from the United States
alone have risen from $600,000,0
to 81, 1,500,000,000 If all the foreign
loans contracted by the Allies, were
at England's disposal, they just
would be sufficient to settle the diff
ference between her peace and her
war imports from the United States.
Happily for Germany, she has not
been compelled to compete with Eng
land in foreign war finance, because
she has been partly blockaded. Most
of the huge capital used in her for
eign trade is free. 1t can be invested
in national loans and national circu-
lation, for her oversea trade has
come to a standstil. English credit
and English money have to circulate
all over the world, for England gets
her supplies from all parts of the
world. In Germany things are far
more simple. The German Govern
ment borrows a few hundred million
dollars in snort-term treasury bills
The proceeds are spent in giving or
ders and in paying wages. When the
bills fall due they are taken up and
paid off from the receipts of a funded
loan. For the manufacturers, the
farmers and the wage earners have
by that time received payment for
their goods AS everybody works as
hard as possible, a high level Of ma
tional efficiency has been reached,
Notwithstanding the shortage of men.
AS consumption Is limited by strict
economy as well as by stringent legis-
latlon, large part of the income OF
all classes is saved. 1t is invested
in business or in loans The savings
banks reached the 10000. 900
marks limit (about $5,000.0 10000
last year Today, after two more big
loans have been paid up, they have
reached 100000 marks, and
the same holds good of private banks.
The Deutsche Banks deposits have
risen from 100000 in 1913 to
$6O5, 100000 in 1915. All capital
which is withdrawn from peace in
dustries, all capital which Is saved,
all capital which IL not needed, ul-
timately goes into the nations great
enterprise: The war. The growth
Of the big cities, for example, has
come to a standstll. People are
leaving, the women go and live with
their families, whilst the men are
fighting. That has no doubt affected
the income of many house owners
and deprecated some capital. But
1t has done away with the necessity
of using a huge capital every year
for building new dwellings for
hundred thousands of people. Not
withstanding good business the price
of capital has not gone up, though
lately there has been the beginning
OF a big boom in industrial shares.
Gro be continued.)