New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-07-12
Rise in Spanish
Exchange Starts
Teapot Tempest
Hea dof Baltimore Concern
Airs Troubles at Confer
ence of Experts

Foreign exchange bankers who Jour
neyed 70 Washington. on Tuesday IN
response to an urgent invitation to
confer with representatives of the
Treasury and Commerce departments
were found TO be in none too amiaoIe
frame of mind yesterday when asked
what had been accomplished as a re-
suit of their pilgrimage.
Max May, vice-president of the Guar
anty Trust Company, who was one Of
those to make the trip, described the
whole proceeding as absurd and out
rageous."
Ostensibly the conference was called
for the purpose of discussing impor-
tant phases of the general situation IN
foreign exchange, but according to
those who hurried 20 Washington 1t
soon developed this was not the case.
The high rate of Spanish exchange was
brought up for discussion, but, so 1t Is
stated, chiefly in relation to the affairs
of Baltimore concern which Is a
large importer of olive oil from Spain.
The president of this concern, y.
Muscher, is said to have convinced
some Of the government officials that
the rise in Spanish exchange to above
% cents to the peseta, the unit OF
currency in Spain, compared with
normal rate of 1913 cents, has proven
costly to American firms importing
commodities from that country.
Complaint Not General
But if other importing houses feel
any concern over the situation, they
did not take the trouble to make a
complaint, according TO local bankers
who attended the conference. In fact,
it soon became apparent, the bankers
say, that Mr.. Muscher seemed to be
the one interested party, and that his
efforts to obtain government assist
ance in bringing about reduction IN
the Spanish exchange rate were sctu-
ated solely by desire to benefit his
particular concern. As soon as the for
eign exchange experts became aware OF
the circumstances under which the
meeting had been called they began to
register impotence to end the pow
WOW, and it is frankly admitted by one
banker that the results, so far as he
was able to judge, were practically
nil"
May Study Neutral Exchanges
There was some discussion regarding
the depreciation of the dollar in the
markets of Norway, Sweden, Denmark,
Holland and Switzerland, as well as
Spain, but this was only incidental.
Unofficially, it is stated that the Treas
ury Department may in the course of
the next few weeks appoint a COM
mittee of bankers to study the neutral
exchange markets and possibly suggest
remedies.
Those who participated in the con-
ference, on behalf of the government,
were Oscar T. Crosby, Assistant Sec
rotary of the Treasury; W. p. O..
Harding. governor of the Federal Re-
serve Board, and DR.. f. +. Pratt. chief
of the Bureau of Foreign and Domestic
Commerce. The New York banks were
represented by Max May, of the Guar
anty Trust Company; George l.. Lee
blanc, head Of the foreign exchange
department of the Equitable Trust
Company, and John f. Gardin, vice
president of the National City Bank.
Spanish Exchange Situation
On the question of the Spanish ex-
change situation Mr.. May. of the
Guaranty Trust Company, said yester-
day that the assistance of the Spanish
government would have to be obtained
in order to bring about a reduction
in the peseta rate The natural remedy
would be to ship gold to Spain, but
the Bank of Spain already has more
of the metal than it can use, and,
therefore, refuses to accept more gold
except at discount of about per
cent. If the Spanish government could
be prevailed upon TO remove the dis
count on the metal this would help to
solve the difficulty. II has also been
suggested that, inasmuch as exchange
between Spain and the United States
is running against US largely because
the big British and French purchases in
Spain are being settled through New
York, a way out of the difficulty would
be the floating of joint credit in
Spain on behalf of the United States,
France and Great Britain.
The situation in the Spanish ex-
change market, it is said. is not af-
fecting a sufficiently large amount of
business, however, to make il neces-
sary for such an important step to be
taken, and most of the foreign ex-
change bankers are inclined to believe
that the market should be left to take
of itcaif