The news scimitar. (Memphis, Tenn.) 1907-1926, 1920-02-21
Foreign Exchange and H. G. l..

Foreign exchange may seem a
pretty distant subject to most people,
but as a matter of fact, It affects US
all very directly and decidedly" says
the Youngstown indicator Dem).
We refuse to take European money at
its face value, and many Europeans
are unable to buy our products at the
heavy discount to which their money is
subjected. AS a consequence, we have
no outlet for our surplus raw materials
and machinery. Europe needs these
articles before 1t can resume produc-
ton of goods to ship to US So, ac-
cording to financial experts, unless this
circle can be broken, the situation will
60 on getting verse instead of better,
and the whole world will suffer from
lack of necessities.
There is no depreciation in COM
modities, as the Columbus Dispatch
und) points out, and this paper goes
on to say:
IF German has a watch that is
valuable, he can trade it for something
else that is valuable. If Frenchman
were to bring over here a trunkful of
laces or chinaware, he would not find
It deprecated in value he could trade
Tor wheat or meat or raw material or
manufactured products of any kind.
man comes along with a handful of
paper money and wants to exchange it
for something which we possess, we
look at it and figure in our minds just
about what the nation back of it will
really be able to pay when it comes to
change rate for the stuff"
So the Dispatch concludes that 1.-The
European nations whose money Is 50
heavily discounted are bankrupt, and
the business interests know it.
The solution will probably have to
come through the people of Europe 60
ing to work and making something we
want and exchanging it for something
we have and which they want"
But TO tell them to do this is much
easier than for them to do it," the
Springfield Republican Qnd.) reminds
US, for, to quote the Chicago Journal
lDem), time is needed to turn war
factories back to peace factories" and
men from the trenches could not at
first bring themselves to go back to
the, humdrum life of civilian work"
'Idleness has been the rule and not the
exception adds the Birmingham
News lDem,); the socialistic idea for
one thing, has demoralized vast Euro
pean populations" But the Salt Lake
Tribune (Rep,) calls attention to the
fact that Europe can not return to
work until they succeed in financing
tleii NOME INDUSTRIES 10 SuCn an eX-
tent that they may be able to import
the necessary raw materials" and the
Norfolk Virginian-Pi Pilot Qnd. Dem.) re-
marks that French Industries are de-
pendent almost wholly for their raw
materials on America"
This means that we must furnish
raw materials on credit, thinks the
New York Journal of Commerce Qnd.).
IF we expect to hold the sound ele-
ments of our business abroad" it says,
we shall have to provide for financing
them" Or. as the Dallas News 0nd.
Dem) puts IT,
The part to be played by America is
evidently that of thrift, well advised
investment in foreign loans or securi-
ties, and the production of the things
needed by Europe for purposes of re-
construction. That of Europe is whole
Souled effort to get back to a normal,
America nor Europe can no the whole
thing alone, though each can do what
will make it possible for the other to
save the situation"
But our terms for foreign credit are
pretty stiff, and the Los Angeles
express 'the opinion that a reason for
the present crisis is found in the prof
iteering by some American financiers. ="
However. is there a silver lining to
this cloud? With our shelves well
StOChetl anu no foreign customers, VIII
not prices here take tumble and drag
the high cost of living down? Under
such conditions" declares the Cleveland
Plain Dealer Ond DEM. lower prices
are bound to occur" and the Arkansas
Democrat DemD thinks "the dollar
will recover some of its old-time pur-
chasing power, which means :. ..
relief to those who have suffered most
from the present situation, the sala-
ried workers and those with fixed in
| comes of small proportions.
On the other hand, as the Fort Worth
Star Telegram Gnd Dem) cautions
us, when foreign exchange begins to
send the cost of living down to the
bottom-if that happens--it will begin
to close up factories and send prices
! of the products of the farms and the
mines down below the cost of produce
| ton, and that in turn will begin to put
men out of work and send wages down
as we'll It doesn't make any
difference how low the prices may be
| If you haven't got the price So
thinks the Tacoma News-Tribune Gnd)
| too. Goods made for foreign custom
ers will be thrown on the market, prices
will drop with a crash and mills and
factories will be obliged to close" "a
moderate checking of the flow of ex-
ports would prove wholesome" thinks
the Chattanooga News Dem.), but