The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-07-31
NEW FRENCH BILLS
WILDE SOLD HERE
Morgan Group Arranges to
Put $50,000,000 Treasury
Issue on Market.
is NEW STEP FOR FRANCE
Notes to Run 60 to 80 Days;
Certain Amount to Be
Placed Weekly.

An entirely new departure In French
Government financing was announced
yesterday at the Offices of J. p. Morgan
q Co. In a statement that that firm
planned to sell French Republic Treas
uy bills OF sixty and ninety days ma
turity TO the amount of $4,000, 900.
Not more than s5,0oo,oo will be sold
weekly. the exact amount to be disposed
Of weekly being dependent on money
market conditions. Although an entirely
new step for France, the plan II SINH
lar to financing done by Great Britain
here In the sale of British Treasury
bills, OF which $s0,000,000 to 100000
900 usually have been outstanding. The
announcement from the Morgan Offices
follows:
''The Treasury of the French Repub-
lie has completed arrangements for the
handling of It's sixty and ninety day bills
In the American market, along lines
similar to the sale of the British Treas
ury bills which have been current in
this market for the last two years. AT
present the French Treasury contem-
plates the issuance of its bills not to
exceed S50,000.000 with a maximum
weekly maturity of not over $4,000. 900.
The rate at which bills will be sold will
depend upon the money market condi-
tons The French Treasury has, of
course. fully acquainted the officials of
the United States Treasury at Wash
ington with its plans"
The British Treasury bills, to which
the new French bills are very similar,
were first brought out on August 1, 1917,
having been current in the American
market since that date. The amount
outstanding, II Is learned, has stood gen.
orally between $50, 000, 900 and 500, 900.
900, although at one time the total out
standing was S16,000.000. The rate at
which THOSE bills have been sold has
varied according to money market con-
ditions, the average rate being between
8 and per cent. The French Treasury
carries large balances in this country, II
Ia said, and could obtain undoubtedly
from its depositaries any temporary &C
commodation which II might desire. 1t
was deemed wise to follow the plan of
familiarizing the general market with
the character OF the French Treasury
obligations
May Affect Exchange.
Although for an indefinite period
; French exchange may be taken right out
OF the market because of the new French
that the issue will have any lasting
effect on exchange rates They are ex-
pected to adjust themselves quickly to
conditions which may exist without diff
Guilty. Franc exchange made yesterday
a new low record again at 1874. railying
tust before the close to 1874.
:. With the great delay which foreign
countries have experienced recently In
obtaining credits In the American mar
ket. the proposal Is believed to be the
hest means which the French Republic
could have adopted to obtain the funds
of which she is just now in such great
need for her initial efforts at reconstruc-
tion. with the postponing of action on
the Davidson plan for financing foreign
nations and the delay which the Edge
bill has met in Congress foreign nations
do not see any hope OF immediate relief
through regular channels. Here and
there an individual credit is announced
by some large banking house, but con-
certed action on that vital point SO far
has been restricted very much.
The French have no irritation against
the United States for the delay, accord
ing TO a banker Just returned from Paris
as they realize that almost insurmoun-
table difficulties face the American peo-
pie as well as the French in their after
war plans. Nevertheless, need for funds
in France to get factories running once
more, to provide labor with employment
and to manufacture goods with which to
meet the republics obligations has
proved great and some immediate action
was considered necessary.
To Float s6,OOO,OOO a Week.
1t is the general belief in financial
circles that should the French Treasury
bills prove attractive in the American
market the maximum amount to be Is
sued weekly may be increased to more
than 100000. For the present bank
ers feel that that sum weekly is suffi-
Client - test the market with and es-
tablish the bills in the confidence of
American investors.
The French Government holds ap-
proximately $4,000. 900 of American
Foreign Securities three year per cent.
gold notes. due tomorrow, which Il
has purchased in the open market. The
Government also has substituted new
collateral against the 100000, 900 loan
advanced to II by the company and con-
sisting of United States Government
certificates of indebtedness for the par
amount of the loan. The original col
lateral. composed OF neutral government
securities to the amount of more than
$3.50. 100000, has been returned to
France and has been used by the French
Government in obtaining credits in neu-
tral countries or restored to private
owners from whom the securities were
borrowed.
1.-THE French Government has paid the
Securities Company interest at the rate
OF tx per cent per annum on the
500, 100000 loan. which has provided
the income for the payment of the 8
per cent. interest on the company's notes
and the dividends on its capital stock
OF $4,000, 900. which have generally
been at the annual rate Of 10 per cent.
although the company originally is
sued $9k50O,000 of the notes, the
amount has been reduced somewhat by
purchases in the open market On July
81, 1918, the amount outstanding in the
hands OF the public was sol ,215, 900.
against which there was pledged with
the Bankers Trust Company, as trustee
for the company's notes. collateral val
ued at So per cent. more than the
amount of notes outstanding"
1t has been announced that funds
are In hand to pay off the outstanding
balance of those notes at maturity.
OWENS BOTTLE REPORT.