The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1919-08-23
ENGLAND FACING
SERIOUS SITUATION
ny HOLLAND

since the United States entered the war
4 in such manner that all that he said
4 has been as carefully scrutinized and
| his statement of facts analysed as has
| been the case with the address which
| he made in the House of Commons on
| Monday of this week. First of all at
| tention was attracted to his statement
! that for several years before the Eu-
ropean war began England's imports
had exceeded in their money value. the
| like value of her exports by seven hun
| dred and fifty million dollars.
Formerly the question was some
times asked the leaders In the finan-
cial district, how it was possible that
England should pay so large an amount
for imports in excess of the amount re-
ceived from her exports without ulti-
mately entailing serious financial dis
turbance and possibly in the long run
business embarrassment. The answer
was ready, for our international bank
ers, knew that while England was
paying many millions more for commo-
dities which she imported than she re-
ceived for commodities which she ex-
ported. nevertheless there was what
was really stupendous balance in her
favor. 1t resembled the invisible trade
balance which offset the favorable
trade balance created when the United
States, in the aggregate of it's world
trade, apparently was a creditCl' by at
least five hundred millions. For against
that half a billion of favorable balance
1t was necessary to offset the vast
sums this country was paying to those
who were citizens of other lands, es-
pecially England. and who had invest
ed millions in, American securities, these
millions calling for yearly disburse-
ments in large amounts in the form of
interest and dividends. Then again we
were paying very large sums for in
surance. for freight charges and also
on account sof Travellers letters of
credit And benefits of this kind, in
visible not reported and yet actual.
were to the advantage of Great Britain
Some of the American men of finance
who went to England in the fall of
1915. returned to the United States to
report in confidential way that Eng
land opened the books. on their in
spection which contained the records
of her investments in other lands. The
figures almost staggered the magma
ton of the American financiers. From
these investments England received
each year in the form of interest and
dividends or discounts an amount of
money which vastly exceeded the fig
ures which represented her loss upon
international trade, that is to say her
exports as compared with her imports.
One estimate has been that England's
incomes from these foreign investments
were considerably in excess of a billion
a year. Therefore there were REIN
vestments. money in enormous amounts
being paid in upon deposit to the Lon
don banks, being made in that way
available for the purchase of foreign
securities representing government
loans, the development of railroads and
the exploiting of natural resources in
other lands.
A GREAT FALLING OFF
Of course the presumption has been
strong that the war entailed not only
falling off in the income thus re-
ceived but also the utilization of many
of the securities SO that England could
find the ways and means whereby her
constantly increasing war debt could
be met But not until Lloyd George
spoke on Monday has an authoritative
statement been made respecting the
falling off in this income. ~ Prime
Minister told the House of Commons
that at the present time England's re-
ceipts from her foreign investments
are as low as five hundred millions
This sum would be sufficient to pay a
large part of the Interest upon the
loans which England has made in the
United States since the war began.
Furthermore, the Prime Minister
made statement which has caused
much comment here. for he said that
England continued along the path
which she is now fo'-wing the ad-
verse trace balance against her would
soon reach five billion dollars
Many of the securities which were
held in Great Britain at the time the
German armies began to cross Belgium
represented investments which the
United states would sooner or later be /
called upon to pay. 1t has been assured
that at least three billions of these
American securities have been placed
upon the American market and sold.
The speedy and substantially unobserv-
ed absorption of these securities by the
American people furnished one of the
first demonstrations of the magnitude
Of the resources of this country. Off
course the income received from the
securities which formerly England held
now goes to that part OF the American
public which cheerfully, eagerly. abb
sorbed, these American securit!As
Some of those things which Lloyd |
George was frank enough to mention |
in his address to parliament were al |
ready known to some of our leading |
men of finance as well as of industries |
but apparently none of them was will |
ing to go as far as the Prime Minister
himself has done when commenting
upon England's present day condition. |
They have all felt however that it |
was vital to the restoration of the pros
perity of Great Britain that she as |
speedily as possible regain and furth- |
ermore increase her international trade /
if she is to find the opening out OF /
the difficult path along which. accord |
ing to Lloyd George; she is now pass !
ing. Intimation has come to New York |
that some of the new German leaders |
are quietly chuckling, having reason |
to believe that although the Germans 7
armies were conquered nevertheless
one of the chief reasons why Germany |
entered Into the war. namely, the inn
pairment or even destruction of Eng |
lands prestige in International trade,
has been accomplished. Certainly these /
Germans viii find reason for that view
in Lloyd Georges statement that Enc
land cannot exist without recovering
and maintaining her international /
trade. To do this she must vastly in
crease her exports and greatly reduce
her imports at the same time produc-
ing and then producing more and more
until at last she is able to supply the
world markets.
THE COAL SITUATION
Apparently Lloyd George realizes that
perhaps the most serious problem
which now confronts England in her
attempt to regain or increase her in
trade is her production of (
coal. Three or four of that consider
able group of very able business men
who visited England in the winter and
early spring reported to their friends
after their return to this city that