The Washington herald., 1918-12-13
LONDON STILL
MONEY CENTER
Holland Discusses Financial
Status Of U. S. After
War.

~. w 49,
Since the war In Europe began. more
and more has there been recognition
of the Importance of the service.
which have characterized the relation
Of Leopold Frederick to the foreign
exchange market and especially to the
developement of so-calied dollar ex.
change"
To many persons foreign exchange
and especially dollar exchange. sug-
gest nothing more than dry. and tc
the public uninteresting, minor de-
tails associated with world trade. Mr.
Frederick. however. has ability so to
handle and speak of this question as
to make 1t of Immediate interest, sug-
! gestins the highly important relations
which foreign exchange and dollar ex.
change bear to the prosperity of the
country. Mr.. Frederick Is not only a
director of the American Smelling
and Refining Company but Is associat.
ed In Important executive capacity
with the Chill Copper Company and
the Braden Copper Company. 1t MAJ
be that in his handling of foreign ex-
change and especially in his creation
OF the dollar exchange market in
South America he has not dealt in ex.
change to the extent of so many mil
lions as did. until his recent retire
ment, another foreign exchange au-
thority through whose hands passed
much the greater part of foreign ex-
change bills which represented our ex-
ports of cotton to Europe. But this
particular service was along ac-
Lon tor Nal kx.AS
cotton transactions only in the magni-
tude of the amount these bills repre-
sented.
On the other hand. Mr.. Frederick
recent achievement, perhaps the
most important of any identified
with his work as an international
financier. is represented by the prog
ress he has made in establishing
dollar exchange in Chile. He.is con.
fident that If our industrial leaders
our legislators and our bankers
adopt wise measures, taking heed
even of those which prevail in Lon.
don and adapting some features OF
them to American international f.
nancing. then we may be able to OBJ
tain and then to maintain the posi-
f, tion of the worlds financial center
Not Yet Financial Center.
Many of the bankers and very
many of the people have felt a sense
of qualification in the belief that the
United States is now a creditor ma.
tion because the world owes us ss,-
600. 100000 and probably within q
year will owe us $4,000. .o0o. 900. thi.
obligation having been created BY
our advancing of loans and money
to our friends across the sea.
So stupendous a credit is this ir
our favor that Mr.. Frederick admits
| IL does create a favorable condition
for permanently obtaining and main.
tanning a position as the money cen
/ ter of the world. But this is not
all. For Mr.. Frederick points to the
i fact that London is still financing te
a great extent world trade and
this is shown by figures which sci
forth with approximate accuracy th'
amount of acceptances outstanding
in London against internationa
business and the amount of accept
ances by New York national banks
London is far ahead of New York
for her acceptances against out
standing international business re-
Gently reached $500. 900. 600 wherea:
New York acceptances amount to 4
little over 5000. 600, 600.
When the day comes when 1t will b,
possible to report that American &C
J ceptances of foreign corporations anC
| foreign agencies are as great or ever
greater than those of London. ther
! we may be certain that, in associa
ton with the billions of debts which
other nations owe to US. we may b.
able, II there be prudence, foresigh
and far-seeing banking management
to command the position of the world
| money center.
! What that will mean to the United
! States no man can now fully ina gine
since the effect upon American indus
trial, agricultural and financial lif
will be stupendous. Mr.. Fredericl
states that it will mean for one thin;
the establishment of dollar exchange!
so-called all over the world so that 1
| will be possible for foreign merchants
manufacturers and the makers of raw
material as well as American export
| ers to secure as favorable terms anC
| as low discount rates as those which
| characterize the London discount mar
ket.
| A Conflict of Views.
Although Mr.. Frederick is Of 8,
high authority that what he says viii
| command careful attention both her,
and in London. nevertheless. the view
which he takes is not the view o
some others who are considered eS
cellent authority. For 1t was stateS
a day or two ago by D. W. Wilson
who is one of the leading authorize.
| in London on international finance
| that the financial center of the worlC
has passed from London to New York
This Is only stating in the presen
tense what one of the financial lead
ers in London predicted early In tn,
present century. For that man tolt
the directors of the great Londor
bank. of which he was a leading exec.
utiye. th,,t after a prolonged visit tc
the United States he was firmly con.
vinced that the financial supremac,
In the world az money center would
be in few yeans transferred from
London to New York.
In reply to this statement. Mr. Fred
erick says that only so far as loans
made by the United States to the al
center been shifted to New York. Bu,
on the other hand. so far as the
financing of exports and imports OF
the world ia concerned. London is still
supreme. The reason Mr.. Frederick
gives for his view and for his belief
that London will for many years to
come outdistanee New York are to be
found In the fact that we are lacking
the large number of Inerch a NO. ha nj 4