The Cordova daily times., 1919-12-31

alization of foreign exchange, intelli gible to the average man, rise above the complexities of the present situa tion, according to old-timers in Wall street. These are:
 l. Allied and other nations of the world >Dwe the United States approxi- mately s15,OOO,OOO,OOO.
 ?. American manufacturers hesi- tate, owing to peace treaty uncer- tainty, to accept big advance foreign orders.
 3. England's virtual suspension of gold exports outside the British colo nies is repulsing American trade.
 .,'Just why the British pound ster- ling, normally worth $4.S665 in Ameri can gold, should have declined so much since the war ended, and what it all means, is an obscure question:" said a New York financial expert. ''The present situation Sir George Paish's apprehensions notwithstand- ing, is by no means hopeless. Prophe ciesof a breakdown of credit are not well founded.
 America, the storehouse of the World, and now the worlds banker, is in the same position England was in after the Napoleonic and American Civil wars. She bought the cheap se- curities of impoverished nations in most prodigious manner, and thereby laid the foundation for her future wealth We must do likewise, and do it within the next two or three years, by which time these abnormal condi- tions will have passed.
 With pound sterling 25 per cent or more below par, England can sell to the United States at great ad- vantage. We can sell American goods abroad only at great disad- vantage, because we must add the ab' normal rate of exchange to the goods to get into, foreign markets. Premier Lloyd George recently declared, when sterling was selling at a discount of 15 per cent, that the discount really represented protective tariff of 15 per cent on goods manufactured in England Certainly it is helping to keep American goods out of that coun. try.
 The only remedy for this condl' tion is for the United States to buy foreign securities and extend long time credit for merchandise. We are in a strong economic position. The nations of Europe must have our cot ton and wheat and, since they are so heavily indebted to us and we must extend them many more millions to put them on their feet, what is the difference whether we buy their bonds or send them our merchandise?
 Everyone in Wall street knows that if the peace treaty had been signed in Washington an international exchange committee would have been organized long before now to stabilize exchange and bring about other neces- sary readjustments. Never during the darkest days of the war, when the Germans were almost at Paris, did British and French exchange go to where it is now. The British during the war, by system of credits with the United States, had sterling begged to s4.52.
 "The tension over and gold exports curtailed, there was nothing to keep it that close to parity. Indeed, unless the United States loosens it's purse strings there are London financial ex- perts who say the pound sterling will drop as low as $2.50. That would be a calamity. It would be a two-edged sword, injuring both England and the United States.
 Europe is like man on the verge of death due to starvation. When you find such an unfortunate you feed him gradually until the stomach becomes accustomed to digesting food. Now our aim has been all along to stuff Europe with all kinds of American products. We have piled up trade balance, according to former Secre- tary of Commerce Redfield, aggregat- ing s4,O0O, 100000 a year. Europe's financial system, like the starved hu- man stomach, has been unable to as- simulate it. Consequently, we thus contribute to the demoralization of for eign exchange and incidentally, by