The Pensacola journal. (Pensacola, Fla.) 1898-1985, 1918-10-23
WEDNESDAY. OCTOBER q, 1918.
is GERMANY NEAR BANKRUPTCY?

Is Germany near financial ruin? Is the serious
condition of her fiscal affairs of the princi-
pal reasons Sor her peace offer? Many we'll
informed persons are inclined to answer both of
these questions in the affirmative. It is known
beyond dispute that Germanys financial status
is anything but satisfactory. In fact it is be-
lieved to be approaching the breaking point, and
this is one reason why Germany is so anxious to
bring about peace
Germany's debt before the war was about
5,000,0O0,00O marks, and some German finan-
siers looked upon this with certain amount of
apprehension inconveniently large.
1t is fair to assume that since the war began
The German debt has reached between S33O00,-
100000 and $4,000, 600, 900 Last June the reich
stag passed a vote of credit of $4,000, DOE, 900
marks, approximately $3.50 900, 900 under nor
NAL exchange, which, it was then declared, would
raise Germany's war debt to 10000, 100000, or
S34,25O 100000. Assuming that her debt now
stands at $33, 000, 100000, or 142, 600, 900, 900
marks Germany has mortgaged, therefore, over
two-ffths of her national wealth. estimated at
$4,000, 100000
Aside from the extent of further German bor-
rowings, which obviously cannot be predicted
the question of the possibility of German fnan-
ces holding together>is bound up in the problems
of meeting the interest during the war; of pro-
viding for some disposition of the principal, and
of harmonizng financial difficulties with popu-
lar feeling.
Five per cent is fair average interest for the
German debt. This would make the annual in
terest on the present debt considerably more
than S1,500,00O,0O0. The average increase of
Germanys wealth before the war was estimated
at 10000,000,000 marks. But since the war,
with the destruction of foreign commerce and the
almost total cessation of non-war industries, it
has shrunk enormously. AT the present time,
Germanys wealth is hardly increasing at ALL
So interest must be met from capital already
on hand. The German hope that she would be
able to get rid of the whole or the greater part
OF her war debt by levying indemnites on her
conquered foes has gone a-glimmering
German authorities admit that the payment of
practically all the obligations has been postponed
until peace times. 1t will take German industry
and commerce. long time to recover, and pend
ing recovery it is likely that it will still be nee
essary to take the interest on the debts to saw
nothing of possible payment on principal. from
the national capital and not from its annual in
crease.
Ihls process, of course, can be continued in
definitely by a sef-contained nation; the trans
terence of wealth from one form to another from
private property of various sorts to government
credits, and thence for Shells uniforms and food
for soldiers, involves questions of physical and
not OF financial possibility. But when the war is
over, when the spur of immediate and compelling
necessity is removed from the German people,
when attempt is made to resume business
dealings with outsiders then it will be different
matter.
The possibility of some form of reputation or
confiscation, either by reducing the interest or
the capital of the debt. in some other way, has