New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-04-05
Credit Resources
OF us. Are Called
Almost Unlimited
Forty Billion Could Be
Raised Before Per Capita
Burden Equals Allies
Expert Gives Figures
C. E. Mitchell, Opposing
short-Term Loans, Explains
Value Of Educating Public
Expert Gives Figures

rr Mitchell. president o. the Ma
..,sl CITY Company. in discussing
-.,ree,ivc government war finance
..,.r5av minated that in his opinion
=, c~,5. resources OF the United
s...es arc almost unlimited. He cited
,.s,is.ies which indicate that this oOun-
- would have to RAISE $4o,ooo,ooo,ooO
,.,vsr before its debt would be in the
,.r, proportion TO its wealth as is
y. debt Of the Entente Powers to
heir combined wealth.
Present loaniug power Of American
,.,ks alone is from $5.ooo.ooo.OoO to
q 600 100000. in addition 20 the loans
,.ev are already carrying. and with
oh tremendous resources. he said. the
...s,ro Of our success in war finance
..o~id he limited only by the degree
- r5pcst;on applied to the problem.
I, IL desirable. Mr.. Mitchell believes,
o.. keen the banks in as liquid cOndl-
.;on IS POSSIBLE. and he therefore ad-
roes+es q campaign of education OF the
1Tsricsn public as 20 the necessity for
i,rcs governmental loans and the duty
~ and advantage TO every citizen OF
ia limited States. 10 matter how small
ar large his savings, to participate IN
such loans when offered.
Opposes Short Term Financing
q, the first Of these problems of edu-
cation Nr. Mitchell said that he was
distinctly an opponent OF any lmmedi-
ale short term financing by the govern,
nent. because short term loans would
rnd field Of distribution IN no large
degree beyond banking institutions
whose LIQUID condition a. the present
lime IS essential, and which condluon
bc felt should not be impaired by eX-
rraordjnarv investment such as they
would be called upon 10 make IN Such
financing. >..,
CITY Company organization seemed 10
no that the most acceptable borrowing
would be in the form OF a loan run
ming. say, for thirty years. bearing IN
-erest al 3i2 per cent. and carrying
nrovisiop that in case, during period
Il one wear from date. the government
should find il necessary. or deem II al
disable. 70 issue securities bearing
higher interest rate than BONDS lssueo
Inder this loan, these bonds shouId De
Convertible into bonds bearing such
higher interest rate.
lie laid emphasis. however. upon the
act that the best trained minds of the
country should be brought 10 bear upon
he determination Of rate and term Of
initial government Offering, believing
- SOD a. y crCh de-
termination would result IN violent
readjustment in values OF securities
low eyistent--a readjustment when
under delicate and intelligent treat
neDt would be entirely unnecessary.
He said further that perhaps $1,000
100000 could be successfully fioated,
dependent upon the degree Of education
given TO the public prior 20 the ofer-
ne.
Need of Popular Education
As 70 the second problem in educa-
,ior Mr.. Mitchell stated that probably
rot more than 10000 persons in the
United States purchase bonds. and,
owing 70 special conditions, but few OF
these have ever bought United states
government securities, whereas IN
France government rentes have been
he popular investment for many de-
eades. Prior 10 the war there were
s.443.904 holders Of the g per cent
French rentes, Of whom about l,40O,OOO
held pieces Of 30 francs or less.
The same condition prevailed IN
Great Britain. though 10 a lesser de-
gree and the result was an enormous
popular demand for the war loans.
These facts, Mr.. Mitchell says, demon
strste that the FIRST step in the dis
iribution Of government securities must
be along the lines Of popular education.