The Washington herald., 1919-06-04
RUSS SITUATION
LOOKS HOPEFUL
Bankers Believe All Loans
(: VIII Be Repaid, Says
/; Holland.

Holland.
Whatever may be the Immediate
eject Of the preliminary action
which has been taken by a group of
bankers with intent to learn. IL pos
si6le, In what way those who hold
the Russian government external
loan notes may be best protected.
there is certainly one very signi-
fictnt feature associated with the
first conference of the bankers,
which should be gratifying to those
who are beginning to be persuaded
that out OF chaos and anarchy and
Boishevism. Russia Is to emerge as
a Strong responsible federated ma
tion.
IN a recent address. DIR. Nicholas
Murray Butler. president of Column
vety long the world will know taat
q new Russian government. a fed
Grated Russia, presumably a repuo-
lican Russia, will be established and
that IL will receive the confidence
and support OF the other nations.
The action taken by the bankers
a day or two ago with the view of
protecting those who hold toe Rus
sian government external loan, $780,
i a
strong inference that our financial
leaders are in possession OF infor-
nation similar to that upon which
DIR. Butler based his prediction. The
bankers are in touch with strong
financial influences upon the other
side of the sea. DR.. Butler has had
intimate personal relations with
some OF the leaders in the govern
nents which are now. and which.
after we enetred the war. were our
allSs It is assumed that both our
financial leaders and DR.. Butler
have received information which
justifies the belief that a new and
ultimately strong and responsible
Russia is to be developed out OF the
ruins of chaos and Bolshevism.
This inference, so far as the
ankers are concerned. is justifled
by the confidence which the bank
crs did not hesitate to express
that by and by. perhaps soon. per-
haps after a year or two. the
principal and interest OF these Rus
sian bonds will be made good. But
they cannot be made good uness a
new and strong government is
Established in Russia.
Bankers Were I'm Despair.
There was a time. not long ago,
when the prevailing sentiment
among the leaders in our financial
world was that OF grievous appre-
hension lest Russia be utterly de-
strOyed, anarchy prevail. and the
day when Russia would find her
SELF would be far distant. Now there
Is y change of opinion. The men
of FINANCE hope. and in fact are
roy persuaded. that there will
speedily be organized a responsible
government in Russia
y that be done. the opportunity
Of the United States for giving and
recsiving benefits would be almost
inconceivably great. Russia has
abundance OF resources that with
a strong government can be prop
erly mobilized. and undoubtedly
one OF the first steps taken by the
new government would be in the
Objection of placing the financial
system Of Russia upon a sure and
hTn foundation. Then there will
follow opportunities for the United
STATES to furnish Russia with needed
raY material. probably in enor-
nous amounts, as well as railroad
and other equipment and with all
the modern utensils. most of them
of american invention which facil-
th9Jities here are inclined to think
that in due time our international
trase with Russia facilitated as
it will be by the extension of
American credits. will equal if not
suFpass our trade with any other
country across the sea.
jumps at Ten Million Bond Offer.
IN this column reference was made
DAY or two ago TO the fact that the
City OF Rio de Janeiro had sent to
Neg York an offering of SO 900 900
in bonds. in the hope that there would
nc - speedy sale of these securities.
10 vas indeed a speedy sale. Within
a few hours after the offering was
MADE public the syndicate which had
underwritten the issue found that so
eager were investors to take the bonds
thRt the issue was heavily oversub-
sCrAoed.
~ course. one reason for this large
subscription is to be found in the
fack that the bonds bear per cent
interest. and s per cent in these times
offers a temptation to those who de-
sirs to invest in bonds. There was
also the excellent credit which the
City OF Rio possesses.
But. after all. what is especially
SBhucdnI IN tn1S transaction Is the
fact that Brazil is now turning to
tho United States as a source for
funps. whereas heretofore. or at least
before 1914. she always turned TO Lon
don The investment of American
noaey in the bonds Of the City of Rio
means much more than return of
per cent upon the investment and
the certainty that the principal to
be paid on the day of maturity.
1t means that BriZal will increase
her trade with the United States. 1t
means that other South American ma
tons will come to the United States
with offerings of bonds or other secu-
rites. ard 1t probably means that in
the course OF a few years this country
viii be found to be the source of new
capital for South America. thereby
assuming a new relation which here
tofOre has been held by Great Brit
ain chiefly. although to some extent
by France and Germany.
The transaction also means that
funds in plenty are waiting invest
ment in good securities, and that in
vestments of this kind will hereafter
not be confined to the United States
securities. but to constantly increas-
ing extent in securities sent here by
municipalities. public utility corpora
tions. railroad companies and various
industries in Europe which stand in
need of American capital and which
there are the HAST NJ raaSap. e. -