The Bridgeport evening farmer., 1917-06-22

4 <fhdurlo, Cpdlub y une Zz."1n0 press
ent economic situation of Spain is in
teresting and provocative of subtle
speculation from many points of view,
and it must be an influence upon in
ternationaf policy. Particularly the
financial aspect must appear extra
ordinary to those who have not fol-
lowed its development closely since
the war began, for in thu period the
almost miraculous has happened, and
Spain has been transformed from a
poor country to one that is compare
lively rich, and has rather more
money than it knows what to do with.
The action and reaction of interna-
tional politics upon the economics is
causing a multitude of perplexities.
Here is money, but where is the flu
sture trade? And the very joy of the
Gpaniard but yesterday at the soaring
value of the peseta is turning to some
misgivings
4By way of stating a simple item of
news. which nevertheless may cause
surprise to persons who have not fol-
lowed this subject. let it be mentioned
that at this moment the Spanish Pc
seta is worth more than ever before.
and is the only coin in the old world
that is consistently and unvaryingly
increasing in value in comparison
with its chief foreign rivals. AT the
moment of writing the rate of ex-
change on London is 21.63. For some
time It found it difficult to get below
the % mark, but it has been there
and gaining fractions constantly for
some days past Compare this with
the 27.17 of the French franc on Lon
don. and the 33.27of. the Italian Ira.
which are nominally of the same val
ue though the franc was better than.
the peseta in peace), and there is ma
terial for thought. = year or SO ago
there was .jubi1atfcn upon the fact
that at last Spain had made its dream
come true of having stocked a thous-
and millions of pesetas in gold in the
vaults of its banks. The storage has
continued ever since, with the result
that at present there are 1888, 900, 900
pesetas in gold in the country's pos
session. And so we have the increas7
I ing value of the peseta, with the
shortage of gold in other countries
When war comes, gold goes, and a
part of Spain looks upon the anxious
finances of a sister state, and wisely
or unwisely, may be led in reflective
moments to think that it would be
well to retain control of the gold that
has been SO long waited for.
-Dut thCiC GACi AoOiiC OiAliCuAL COii-
sfderations, and the soaring value of
the peseta is no unmixed commercial
4 blessing Obviously. its purchasing
power In foreign countries is greater
than that of other monies, but a diff
ficulty arises in trade relations with
4 one of the two chief customers Eng
land All freights from Spain to Eng
land are contracted for and paid for
In pounds sterling, this, of course, be-
ing independent Of all variation in the
value of the peseta. Having regard to
this consideration the Spanish end is
the loser by getting fewer pesetas on
the exchange than formerly. On the
other hand it is argued that the in
crease in trade and values should be
regarded as more than coInpensating
for this figuartive loss. Then iron,
copper, pyrites, exported from Spain
to England are paid for on the Eng
lish standard, so the rate of exchange
goes against the producers Again it is
the same with fruits and other ar
ticIes, and here the Spanish trader
will complain to you that he suffers
doub1y, for he has to bear competi-
tion with other countries, such as
Portugal, whose rate of exchange, be-
y ing sterling, acts in their favor, their
money values having declined. 1t Is
pointed out that in this way, a Portu-
guese product can be offered in Lon
don at an advantage of SO per cent
over the Spanish.
While other countries have done
something to remedy the unfair work
ing of the exchange as the result of
the decrease of production by the AL
Hes engaged in war;, and there being
SO much less expectation from them
to other countries whereby the ex-
change might be balanced, Spain has
done nothing, and the case is difficult
in that iron is really the only export
to England that is essential to the
matter There is one point of view,
that, wheneas, through the circum-
stances brought about by the war and
the great business done by the coun-
try with foreign countries engaged in
the struggle, and others whose nor
NAL supplies have been cut off as the
result of their providers having be-
come belligerents, there is a great ma
tional prosperity and the fluctuations
Of International currency. have caused
a great increase in the value of the
peseta, this increase is operating
against the Spanish trader when he
deals in the deprecated pounds ster-
ling without the reciprocity trade in
the opposite direction in pesetas. But
his gains are so substantial in other
directions, and trade so enhanced,
that after all, as is urged against 1T,
this is somewhat narrow view. In
these considerations one is, of course.
leaving out of the question such trade
restrictions and difficulties as. have
recently been caused by the submar-
inc campaign.
On the other hand, commercial au-
t1norities declare that the era OF. bros
perity through which the, country is
4 now passing is SO splendid that 1t
could not have been imagined three
years ago. The banks show WHAT is
being done in the way Of making
money, and an examination of the an
nual balance sheets of the ordinary
\ commercial and the savings banks
shows that in 1918 and 1915, there
was an increase in the amount Of
current accounts by about $50, o 90, % 90
pesetas, of about 100, 000,0DDy pesetas
put on deposit in the savings banks,
and of 1850, 00O, 900 pesetas in .secur-
tiles deposited, To these i'm pressive
figures there may be added a further
sum of 400,00o.000 pesetas, represent
ing the, increase in those two years
Of the total of notes in circulation of
the Bank of Spain, and it is concluded
that the national wealth has Increased
in that period by not less than 1900.
100000 pesetas. Whatever trouble
may be caused with the exchange, and
!. -