Atlanta semi-weekly journal. (Atlanta, Ga.) 1898-1920, 1917-04-10
CREDIT Of At LEAST
S2,0O0,0O0,0O0 FOR
THE ALLIES At ONCE
Vast Financial Resources of
United States to Be Unlock
ed to Entente Immediately
Without Any Profit on Loan

WASHINGTON, April 1.-Admmlstra-
tion leaders in conference today decided
10 unlock at once the vast financial re-
sources of the United states to the al
lies.
To relieve the economic needs Of the
entente governments q huge Ioan, of di-
mansions yet undetermined but not less
than $1,000, 900. will be forthcoming
from this country speedily as con-
gress can pass the necessary legisla-
tiOn.
Not penny of profit, il was auShori-
tatively stated, will be expected or re-
ceived by this country on the loan. The
loan viii be Americas Immediate contri-
button 10 the allied cause, with the
promise OF other bountiful contributions
OF money, munitions and foodstuffs to
come as needed
An immediate bond issue, possibly to-
falling $4,000, 900, 600, is forecast by to-
days action.
The exact amount is yet to be deter
mined
Legislation providing for the issue will
be introduced in congress speedily, not
later than next week, and within thirty
days. possibly before the end of the
present month, substantial portion of
the great loan is expected to be availa-
BILE for The entente governments.
The forthcoming bond issue. it was
suthOritstively said. will be placed be-
fore the public as Quickly as possible
in denominations down to S1OO, possibly
to S25, Will bear "a reasonable interest
rate" and the entire army of American
investors-banks, corporations and indi-
viduals-will be afforded an opportu-
nifty TO subscribe.
Treasury department and federal re-
serve board officials believe that a $5,-
OOO.0O0.0OO bond issue can be absorbed
without difficulty by American inves-
tors and il is likely that this will be
the first, sum offered.
A statement from the comptroller of
currency just before the bond issue an
nouncement was made showed the coun-
try to be in better financial condition
than ever before TO undertake so great
financial project.
But the fact that issuance of this
bond issue comes at the very start of
the war does not mean that future gen.
eratiOns will bear the whole burden. In
stead. the administration intends to ad-
here, so far as il may. to the principle
of "pay-as-yOu-go' through greater
taxes.
The encouragement came tonight after
Secretary of Treasury McAdoo had talk
ed long with the legislators upon whom |
deNOlves the work of shaping the ad-
ministrdtions financial course within |
the congress.
As now planned, the bond issues will be |
handled through the federal reserve sys-
tenn. instead OF as in the past by I'M |
derwriting OF big private bankers.
The Iaiion's funds. swollen by war
prosperity. are greater than ever before. |
On the last national bank call the re-
serve stood at $2,642, zoe. 900: specie and
balance on hand at $1.456. 900 900; total |
deposits at $12, 957, 900 ,O0O-greater by !
S469. 10000 than ever before: while |
loans and discounts were sS.712, OOO, 900. |
The present plan calls for the ex-
change of American money, dollar for
dollar. for foreign bonds at par Bonds
of the entente governments would be
accepted by the American government
as security for the loan. The interest
rate on the foreign bonds, it was said.
will be the same as on the bonds to be
issued by this government in raising
the big loan.
Thus. should the first loan to the
allies be $4,000, 900, 00O-a sum indicated
by one official participating in the for
nation of the program, the United
States would make this sum available
out of proceeds of its own bond issue,
taking bonds to the face value of So
OOO. 600, 900 from the allied governments
to which the loan is made. The allied
bonds would be held i'm the treasury here.
Interest on them would be paid to the
American government at the same rate
as the government would pay on the
American bonds sold in this country.
Not all of the first big bond issue.
. was intimated, would be loaned TO the
allies, sufficient reservation being made
to cover the naval and military needs
of this country not met by taxation.
A considerable proportion of the $3,-
500 ,OO0. 900 already asked of congress
for the military and naval establish
ments during the first year will be
raised by increased taxation, possibly
as much as 1850. 900 900.