Every evening, Wilmington daily commercial., 1920-02-07
HARD TIMES AHEAD
BUT NOT A PANIC.
F|NANC|ERS SAY
Europe in Desperate Situation
Financially; Stress Here Due
TO Lack of Exports.
CHEAPER LIVING is SEEN
correspondence baltimore sun.


Correspondence Baltimore sun.
Washington, Feb. 6.-"This country
will undergo period of financial stress,
but there will be no panic, no crash and
no wholesale crumbling of values.
Europe is in desperate situation
financially and conditions there promise
TO become worse before they become
better
The delay In the ratification of the
peace treaty, with its direct effect upon
economic conditions in Europe, has
removed all thought of the extension of
further credits 10 the Old World at this
time.
There is no remedy for the demoralized
international exchange situation except
the cure of time.
REPORTS MADE BY EXPERTS.
The above is the substance OF reports
which have Just been made TO the State
Department by international tnanciers
who are known TO be Intimately ac-
atiainted with the inside processes both
at home and abroad The Sun cor
respondent learned positively today that
these reports proceed straight from men
on whose counsel and advice the Gov
crnment has relied since the country
went TO war with Germany.
The Administration II Is known here,
Is concerned over the abnormal condl-
tions which have deprecated the pound
sterling. the franc and the mark TO an
unprecedented extent and Yet that con-
cern does not assume the degree OF
alarm. la fact, there are officials here
who are entirely reconciled To this sit
liation and who feel that the reaction
will be wholesome for the whole world.
Certainly it will give satisfaction to the
great body of the American prople II 1t
depresses the cost of food and clothing
Us is believed inevitable by many.
The expert advice which has just been
gwen 10 the Government, while describ-
ing the situation in its most serious
aspect, does not lead Administration ofh-
cials To anticipate an economic break
down or a period of stagnation. These
advisers give warning, however, OF hard
ships which may seem all the more pro-
nounced because of the more or less IN
hated prosperity of the last five years.
AS ONE EXPERT VIEWS 1T.
The Sun correspondent is authorized
To summarize the report TO the Govern
ment made by one of the ableSt tinan-
ciers of that group which has been
leaned upon by the administration In
the last three years for assistance and
guidance in fixing the Governments
Souonnic pohties' ihSoo NACho aS -
follows:
Europe is suffering from a malady
that is easily diagnosed. She has been
destroying more and faster, since August,
Ibl4. than she has produced. The inevita-
ble and natural consequences has been a
hiatus of food, of manufactured products,
OF natural produce, of money and, OF
course. OF men. Europe cannot recover
from such a cataciysm speedily. IL viii
take time-doubtless long time. II
will take her longer than If IT had been
possible for America to extend credit
ou Il comprehensive scale to the war
impoverished countries. Ii the peace
treaty had been ratified, let US say, In
August, 1919, when English and French
exchange was not yet at an abnorm 81
discount. or at least not at the present
fabulous discount, it is altogether likely
that American money would have been
available in adequate quantities for
European reconstruction purposes. IodaN
american confidence IN the European
situation Is far too undermined 10 make
the extension Of credits either feasible
or possible. Europe has now 10 work /
out her own salvation. As already |
Indicated. she can only do so slowly |
snd laboriously.
1T does rot follow that there will be /
a crash IN Europe during the long |
drawn-out process OF rehabilitation
Things TO a certain extent, II can be /
said, have become about as bad there IS /
they can get without absolute chaos, of |
which there seems no danger. What |
Europe has 70 do first of all is 10 check /
importations and accelerate exports; 10 /
stop the outgo and increase the income /
d funds.
AMERICA TO BE HARD HIT.
The arrests of imports, Of course. will /
hit America directly and materially. 1t /
viii affect al walks Of our life. Ii un-
qt,estionabiy will prt cipltate hard times
this spring and summer and, perhaps,
throughout the entire year Production
viii To- cIrtailed, because of decrease of
exports Wages will be reduced and un-
employment may eusue on a considerable
-cale. Railroad earnings will fall sharply
IN consequence. Certain railroad com
panies may 20 into receiverships
The silver lining 10 this economic
cloud is almost certain 10 be i reduction
ln the prices OF many commodities, the
OF which today contributes
ma teriallv TO the high cost OF living.
1T has been asslduously stated Of
late In many quarters IN the United
States that the basic cause Of economic
tiLdRfoD tifOuetfDGt IsIiOiEF anu
consequently in the United States. lies
in the harsh economic terms imposed
upor Germany We are told that the
peace treaty ties up Germany financially
and commercially in such way that she
cannot produce or earn, or pay; that In
turn. she cannot square indemnity ac-
counts with France, and that France,
in turn. cannot pay off her indebtedness
either to England or to America Thus,
II is argued, IT all goes back to the i'm
possible conditions TO which Germany
has been subjected.
Few people are aware that there is
q very subtle and astute German propa-
ganda conducted throughout Europe and
the United States, based on arguments
like this. The idea, Of course. is BY hook |
or by crook TO accomplish soften
ing OF the term TO which Germany has
The argument should not
he taken seriously. 1t has no founda-
tion in fact. The real causes of the in
ternauonal economic upheaval are not
TO be labeled Made In Germany II is
the inexorable consequence of the GEN
erai world turmoil since 1914"
AOn-Support Case Continued.