The sun., 1919-07-17

war started and 100000 men were
mobilised almost over night n general
moratorium became necessary.
AT the beginning OF the war" he
said. there were 5000, 100000 to s,ooo,-
100000 francs outstanding in trade ac-
ceptances. OF these bills, frozen In the
moratorium, only 500, 900 francs re-
main unpaid, and It is expected that
eventually half OF that remaining sum
Will be paid. leaving unpaid only those
sums due from persons who were killed
or ruined In the actual struggle. In
other words. during the actual war time
France reduced these debts from $780,
Goo,ooo to 100000 francs.
us not that a tremendous proof OF
the strength Of French credit that after
this five years OF tragedy less than
s1oo.00o.0o0 OF bills remain unprotected
Railroads Fast Restored.
NINETY per cent. Of our destroyed
railroads are reconstructed to-day.
Canals In the north and east are so per
cert. restored. Our automobile factories
that turned out only shells and guns
and tractors and carriages are once
more In full swing building cars. with
VI DuTCndEeTb III BlknI anu ue-
liveries already begun. Our spinning
and wooden industries already are ahead
Of our supply of raw materials"
He reminded his hearers that the
transition from n condition OF lament
able shortage of ammunition at the be-
ginning Of the war to a plenitude that
enabled France to supply America too
had taken place without any definite
line Of demarcation. Reconstruction, he
declared. following the same traditional.
careful. individual and possibly slow
French method, will take place in the
same almost imperceptible but neverthe-
less efficient way.
He decried the tendency to lump the
whole European problem as one and. in
sisted on speaking for France alone.
There. he said. the banks were clear OF
the war moratorium within a year: they
are now in a splendidly liquid shape
ready to accommodate all customers,
and the new Credit National, for loans
to the people of the devastated regions
soon will be in operation to discount the
indemnitles they will eventually receive
from the enemy. ExemplifSing the
strong condition OF the French invest
ment market and indicating its ability
to absorb Industrial issues, he said that
the Just issued loan Of the city of Paris,
a billion and half francs. was snapped
up at a premium of per cent.
1--WE have two big problems still at
hand" he added. The first concerns us
only. 1t is financing definitely the
French Government through conversion
into long term bonds of the short term
securities and the surplus Indebtedness
Of the Bank of France. This Is q big
job. but we will do 1t. We know how to
deal with the French people
Our methods are perhaps not so bril-
liant as yours. but we succeeded with
them at times Of crisis worse than this
We succeeded with them after 1870
when we were beaten: therefore. beins
victorious to-day. I am perfectly conf
dent that our methods will work sue
cessfully once more.
The second problem, which interests
you. is our exchange and our foreign
purchases. We are much in the same
position as good railroad. your own
Pennsylvania. for instance, with a ma.
turing bond issue. How does a good
railroad pay? 1t has no money. e has
only equity. Therefore II has to borrow
again until II can repay by instalment.
through sinking fund that which |,
owes. Railroads also issue equipment
bonds to buy material they need to as
sure traffic.
''All this Is considered very norma
here. A country like mine ia exactl,
the same on a large scale. We were
perfectly balanced before the war. We
were even loaning half a billion dollars
to foreign countries. But during five
years we attended only to the business
Of not being beaten by the Germans
trade and have accumulated an adverse
foreign balance
"Our exchange is bad at present be-
cause foreign credits are smaller than
our needs temporarily. Dollars are
scarce, and. as We have all sorts OF
stocks to replenish. the demand for dol.
lars is bigger than the supply Hence
like wheat after a bad crop in Chicago
they rise in value.
Favors Popular Sale.
but we will have good equity. lots OF
equity, behind the franc and. II II wai
only a question of its intrinsic value, you
would not get francs at $50 for a dollar
AS soon as our industries are on q nor.
NAL basis again. as normal communica
ton and travel are resumed. francs viii
not only have equity behind them but
will he in demand all over the world.
Therefore the whole problem sums VI
W tHle ~ we are snort Oh dollars Tor
time. how can we buy American prod
ucts and how can we pay for them to
day? For railroad the Americans arr
satisfied to take Its securities. Can W,
place our securities here-that is tn
problem?
There Is no doubt but that there ar,
n million Americans who would gladly
take one French bond Of 800 or more
This would mako large sum. which
would speed up our reconstruction anC
inside reorganization tremendously.
Now, how to reach these willing pur
chasers? 1t is what neither ourselves
nor our American advisers and friends
have been able to find out yet"
He said that the difficulty of the trans
action lay in the quick split up into pri
vate ownership OF goods shipped I,
| France and the unwillingness OF tn
French consumers to go into a Govern
ment controlled consortium such as wa
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