New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1918-08-11
Help for Italy
Is Step Toward
Winning War
Luigi Criscuolo Urges More Sup.
port of Lire Exchange in
This Country
Financial Editor of the Tribune.


pertinent statement was made: ave
can stabilize the American dollar in
Spain by sending certain goods to
Spain, and stabilize the Italian lire by
encouraging Italy to ship US certain
products"
Whether we can ship goods to Spain
depends upon ID whether we can
spare the goods from our allies; (2)
whether. if we can do so, we can af-
ford to spare the tonnage, and (3) the
extent of the demand in Spain for our
products and whether the volume we
could send would materially affect the
exchange situation.
AS to Italy, one of our best in
+ formed Italian merchants doing bust
ness in New York stated in an article
published in I'll Carroccio" last year
that France, Spain and even Argentina
were robbing Italy of her markets here
tor cheese, olive oil and other prod
ucts, SO that after the war is over
Italy will have to begin anew to create
markets here which she had been al
ready developing to large degree be-
fore the war began.
Why should Italy ship her products
here, If she has no surplus, when she
would have to buy of Spain or France
or England? Such course might help
the exchange situation between the
United States and Italy, but it would
tend to create disparity between
Italy and those countries. Further,
Italy would perhaps have to export to
the United States much more now than
in the pre-war period in order to
stabilize her exchange rate, and this
is not possible.
Last February published an article
on Italian exchange in "The Bankers
Magazine" in which l argued for a
conference between the representatives
of the Italian government, a group Of
American bankers, representatives of
Italian banks and some financial ex-
perts. The article had been presented
privately to the Italian Ambassador in
December, 1917, by q prominent Italian
shipowner who knew the Italian Am
bassador intimately. Some time after
it was announced that the National In
stitute of Exchange had been organized
in Italy, with Minister of the Treasury
Nitti at it's head. The revised article
as published last February contained
this additional information.
Could Have Kept Lire Up
That my preliminary article was in
any way responsible for the establish
ment of the institute 1 do not pretend
to claim. That it was sponsible for
great deal of interest among American
bankers in Italy's problem am sure of,
because of the letters l received from
the heads of large institutions in rela-
tion thereto. If the Italian government
and its representatives. here had needed
the signs and had taken the same in
terest in Italian exchange as the Brit
ish and French representatives did in
their respective exchanges, lire would
not have been quoted above 900, as
against normal OF 5.16.
The establishment of the Italy
America Society, which was the climax
Of my writings on Italy's finances and
aspirations, was of great influence in
stabilizing lire. The interest of so
many prominent statesmen, bankers,
manufacturers and merchants in the
aspirations of the Italian people could
not fail to have an indirectly bene-
fetal effect upon Italys financial mar
kets. That lire are now quoted below
800 Is proof of this. However. the
latter part of that year the New York
manager of one of Italy's largest
banks told me that with less than five
million dollars he could have held the
price Of lire by buying in the market
when lire were offered. He claimed
that there was little demand for lire
here and a large and increasing sup
ply, which could only result in de-
moralization.
Obviously, bankers deal in foreign
exchange to make profits on a rising
or falling market. AS stocks are
bought when low and sold when high.
so with lire. And when lire are re-
garded as high short sales are in or
der. To what extent American bank
ers sold lire short after the disaster
at Caporetto have no means of
telling. But l am quite sure that it
was perfectly natural that such short
selling should ensue, else why should
lire sell at 8.93 about that time.
against francs at around SIP?
United States Credit Aided Italy
l can only say that this condition is
due to either lack of realization on
the part of the representatives of the
Italian government here to the actual
financial situation here, or else to their
difficulty in obtaining credits. Shortly
after Caporetto the United States gave
Italy credit of 1926, 100000, which was
of very material assistance, but it did
not solve the problem; to date Italv
has received credits aggregating $780,
100000. These credits have undouht-
edly kept the lire situation from grow
ing worse, but they have only partially
aldeds in bringing the price to less
than 800. What the future is. no ono
can surmse