The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-06-28
U. S. WARSHIP ACTS
AS FEDERAL BANK
Bulgaria Pays for Grain by
Depositing Money in Vault
on Vessel.

4 Transaction, unusual In the business
affairs OF this country. has been re-
vealed. 1t Is a deal between the United
States and Bulgaria, in which a large
shipment of grain has been paid for by
deposit of gold in the vaults of a United
States warship In the harbor at Con-
stantinople. Germany, too. has bought
large quantities OF grain from this coun-
try, which she has paid for in the yellow
metal. These facts were learned from
q reliable source yesterday.
The amount of either transaction has
not been divulged by the Government or
by the United States Grain Corporation,
through which the deal was conducted
The grain involved was sent to Bulgaria
by the Grain Administration and pay
ment made in gold. The gold was trans
ferred to Constantinople, where 1t was
taken aboard a United States warship
lying in the haroor there. In the mean
time.. Bulgaria. with which this country
has not been at war, was allowed to sell
goods in this country and she shipped
here large quantities of tobacco and
otner OF her products thereby establish
ing substantial credits. As these credits
grow. the gold deposited on the warship
was released and taken back to Bull
garia.
In the case OF the sale OF grain to
Germany three options in the manner
OF payment were allowed that country
They were payment in gold. payment
by the transfer OF securities or payment
by the establishment OF credits on goods
sent TO this country. The last OF these
was impossible because of the utterly
demoralized state Of Germany's indus
trial affairs. The second option proved
impracticable because Of the inability
ant %
mandeer or otherwise acquire the neces-
sary securities. The only manner in
which payment could be made was by
transfer of gold.
Tho gold was taken to Brussels and
placed to the account OF the United
States II Is now understood to be In
process of transfer to London. whence,
at the pleasure of the Federal Reserve
Board. II will be transferred to New
York. probably via Canada, the route
of all recent shipments of the yellow
metal from England 10 the United
states The amount OF the transactino
has not been divulged. but it is known
to be considerably In excess Of $1,000
900.
Reports TO the effect that the United
States Grain Corporation has made in
quiries of Chicago banks IS In the
amount of money thev WI be able to
furnish to the Gra'7 A ADMINISTRATION. re-
ceived in New -. ': from Chicago, have
been denied enphatically by officials
here. The reports declared that the
Grain Corporation was seeking loans
from the Chicago banks to finance the
grain which the corporation would buy
from Western and Middle Western
grow ers,
A letter written recently by Julius
Barnes, director OF the Grain Corpora
ton. to about 400 banks throughout the
country Is believed to be the basis for
the rumor. The letter was an assurance
to all banks OF the country that the
Grain Corporation stood behind the
farmers Of the nation to the extent OF
the price guaranteed by Congress for
wheat, and pointing out that loans might
be made TO grain growers without fear
Of loss That the Grain Corporation will
need money from the banks is not con-
sidered probable In view OF its present
resources. In addition to its orr sinal
capitalization OF $4,000. 900, the United
States Grain Corporation has been
granted by Congress an appropriation OF
1000. 900. 900 with which TO carry on its
affairs. and It is believed that That
amount will be ample 10 care for its
needs,