The Pensacola journal. (Pensacola, Fla.) 1898-1985, 1919-09-02
FOREIGN TRADE AWAITS PEACE SETTLE
MENT.

The reestablishment of healthy trade condl
lions depends upon the settlement of the presen
international relations according to tn
current issue of American Goods and Foreign
Markets" the semi-monthly publication of Tn
Guaranty Trust Company devoted to foreign trade
The review says:
Europe's need for our goods is pressing.
particularly in the matter of raw materials and
fuel Goods for our consumption will be
available until European production has recov
cred sufficiently to produce a surplus. We cam
not be repaid for what we have loaned until
industry in Europe is again humn1ing. And in
dustry cannot hum until materials and ma
chinery are available. Obviously. in order to
protect our past loans must lend more. in
order TO put them in a position to repay their
past borrowings and take up again their in
dustrial and commercial life
Thus. healthy trade conditions in the world
will be attained only when. through the extern
sion of American credit, European industry has
been restored to the point where it is able to
produce surplus sufficient to maintain and
progressively liquidate it's indebtedness the
United States at the time that it is
Stunning it's exploitation of markets in the
backward regions OF the world From sell
fish point of view conditions will be healthful
only when Europe has found a way to pay her
present and future indebtedness US. and
position in the markets has been consolidated
to the point where effective disposal may be
made of surplus products, both
terials and manufactures.
The vital factor in all this, for the
past six months. is the extension of American
credit to Europe Upon which shall be adj
vantageous both sides. Until this is done
European living costs will continue to soar,
American markets will continue contract
and production will be impeded both sides
of the Atlantic at the very time when produc
ton is the greatest need of the world.
Credit upon a Iong-term basis. which the
status of European industry demands is es-
sentially not banking operation, but rather
financing operation. This means that the
banks alone however clearly they may the
needs of the situation. cannot handle it with
their own resources. The very essence of bank
ing funds is that they be kept liquid Long
term European credits are, however. very
fitting investment for surplus capital, inso-
much they will conceivaby pay attrac-
tive rate of interest, and also form adequate
security for loans. Properly safeguarded by our
government. such credit operations would
make clearer the way toward the solution of ex-
change difficulties and many of the economic
problems which harass the world
But the problem cannot be successfully at
tackled long as the present uncertainty about
The lines which the world is follow in the
future be clearly marked before the de-
tails of future international economic relations
be staked out. Granted quick determine
ton of peace conditions. and the assurance of
adequate government support in financial
dertakings, there is little doubt that the banks
and industries of the country could shortly Of
Europe credit proposals that would gladly
be accepted and tend to bring into being the
healthy state of trade which is the prime need
of the world.