The sun., 1917-05-27
GOLD WITHDRAWAL
EXPLAINED BY WAR
Finaneiers Say New York Is
Now Financial Centre
of the World.
JAPAN NEEDS THE METAL
Rapid Growth Of Industries Is
Taken as Reason for Big
Shipments.
JAPAN NEEDS THE METAL

The financial district IL not alarmed
to the Same degree as Washington and
Administration ofsicials at tho fact that
Japan has been withdrawing gold from
the United States at the rate Of $780,
0oo,o 900 to $500. 100000 a year. Promi-
nent financ1srs said yesterday that New
York has displaced London as the
worlds gold distribution centre in the
course Of the last two years and that
II has now become our duty to redistrib-
ute part OF II to other quarters OF the
globe in response to the action OF in
terpa tional exchanges.
Bankers said that in the course OF the
war the allied countries became in
debted not only to the United States but
to the neutral world at large. and the
gold that has been sent here was not
only in settlement Of debts owed In
the Cpited States but to pay other
creditor nations as we'll, who are now
demanding their share Of the yellow
metal. As the United States Is by far
the largest creditor II Is oontended that
she will in any event retain most OF
the gold that the Entente nations have
given up. Shipments of gold to this
country from all sources since the BE-
ginning Of the year amount to $780,
900. 900.
Dollar Exchange Extended.
One Of the most significant develop
ments in the realm Of international
finance caused by the war has been the
extended use Of dollar exchange through
out the werld. and sterling at New York
and dollars in London have become the
pivotal exchanges OF the world. IL Is
recognized that " exchanges between
these two great cities could be brought
upder control the exchanges In other
countries will b automatically taken
care Of.
The previous large movement Of gold
to japan ceased in November Of last
year following the sale by the British
Treasury Of $4,000, 900 OF its short
tern, bills to Japanese Investors. The
| transact involved the transfer to Brit
| ish account Of 35o.Oo0.o00 Of New York
banking funds accumulated here by Jap
| aness commercial interests.
Since that time Japanese exporters
nave been accumulating large balances
| here In tho course OF trade interchanees
between the two countries. and further
gold exports were expected by bankers
| provided the British Government did not
again arrange to make use OF the funds
by another loan in Japan.
.papAn's lndu stries 0rowins.
Japanese industries have had an alb
normal growth and her exports greatly
exceed the imports. Already Japanese
cotton goods have supplanted those from
England and America in the Far East
| tern markets TO such an extent as prac-
ticaily to snnihilate the trade Of these
two old established nations. War muni-
tions and shipbuilding have also made
Giga ntic strides, and large capital previ-
ously employed in the United States is
now needed in Japan In banking CTR
cles here the general opinion Is that
Japanese bankers have been drawing
down their reserves in this country TO
meet increased expenditures at home,
| where reserves can be put out at bet
ter interest returns. Japan now ranks
J as one Of the foremost creditor nations
| in the world.
The idea is scoffed at that any Of the
| sold exported from the United States
will reach Germany through Japan. as
that country Is regarded as doing a
tremendous work In her sphere OF the
war. giving invaluable aid to her al
lies in every way and with the full
intention Of continuing to do 80.