The Birmingham age-herald., 1920-03-10
MAKE EFFORTS TO
 SETTLE EXCHANGE
By HOLLAND

By HOLLAND
 New York, March 9.-(Speeial-)- From London there came the first au- thoritative statement of the great diff ficultv which 1t was needful to over come before the notes aggregating s250, 100000 dollars issued last fall by Great Britain and offered for sale in the United States were all marketed; Thomas W. Lamont made adm .ssion in a statement prepared for the London Times that this offering was with much difficulty made successful by very small margin. So now from Lon don there comes the first authoritative statement of the purpose of the inter- national conference which is to be held in at spring. at which the question Of the foreign exchanges will be Gis- cussed and, if possible, satisfactorily answered
 Already in New York the general purpose for which this international conference was called was known. In fact, it was possible to report in this column some weeks ago what is likely to be the plan which the conference will consider and which. if adopted. will probably rapidly restore to nor nal conditions the foreign exchanges. That will mean so much to American industrial life and to the Americans have had no opportunity to export commodities to Europe. since the ses- sions at the conferense and the action which will ha Sh0nI6 a fOl- lowed, and probably will be- with in- tense interest by the leaders of Amer
 ican industries.
 Walter Leaf of London, who is chair man of one tI the worlds greatest banks, himseI high authority on all financial subjects. was invited to ad- dress a meeting of the London bank CTS. That meeting was held a few days ago, and the report, which has been re- ceived in the United States, which briefly sets forth the main features of MT. Leafs address has caused no lit tie comment. almost all of it favor able
 MT. Leaf said that. at the international conference there will be offered propo- stion from the bankers Of neutral coun- tries, suggesting the organization of an international exchange bank.
 It is perhaps more than a mere coin- cidence that at the meeting of the prime ministers of the allied governments ses- sion, when the London bankers met, 1t was agreed that it may be highly expe- dient to invite the neutral countries to join in absorbing a loan which Germany will be authorized to offer, at least II present plans are carried out.
 TO THE NEUTRAL COUNTRIES So also an appeal is to be made to and, according to Mir. Leaf, propositions will ho 1, lxxr bon lrorc of th, moi fra1 n- tries to establish an international ex- change bank. The sole function of this bank will be to facilitate the movement which, when complete, will cause the restoration of the foreign exchanges to normal conditions. If the plan is adopted it will be from one point of view league of neutral nations, whose purpose IS wholly economic, and which will repre- sent cooperation of all efficient methods such as government guarantees, the fur nishing of capital and the providing of an available medium whereby payments can be made for commodities.
 How much that twill mean for the United States, whose industries are now seeking world markets, but are likely to be curtailed by reason of the inability of people in foreign lands to pay for these commodities. If that inabilitys con tinues then we are certain to lose some of these markets, unless there be an en- larged extension of private credit, al though the markets Of South America and the far east, where we are heavy purchasers, will remain open to us.
 MT. Leaf spoke to the London bankers as though he had already been in con ference. informal and probably for the most part by correspondence with some of the American bankers. For some oi the things which he said were identica in terms with statements which were made by American bankers early in the winter. He said, for instance, that an in ternational exchange bank must o' established with abundant capital. In New York, when this plan was dis cussed early last winter, the opinior seemed to be that capital in abundance could be secured. Furthermore. MT. Lea said that the international exchange bani must be backed by all the neutral gov ernments which take part in the under taking. This in itself would represent financial international league of aiiles nations The bank would receive gold anf securities of unquestioned value upoi which notes or certificates would be is sued. Here when this plan was discussed the notes or certificates were spoken of as scrip, but the meaning is the same, what ever term be employed
 HOW SCRIP IS TO BE USED These certificates ar scrip having pc hind them the guarantee of the allie, neutral nations, as well as security Il the form of gold and other securities would he made availabl, exclusively fo international trade purpose. Ultimately according to Mir. Leaf. these notes O scrip could be converted into. gold. and a any time would be convertible in eacl country into the currency of that coun try. Apparently the purpose would D thus automatically to give good value ( the currency of each country.
 If this plan be carried out entiret through the aid of the neutral nation with the understanding. as would pron ably be the case with the proposed Gep man loan. that the moral support an approval of the allies would he siven. l will become traditional anc perhaps tn highest and most elaborateiv simple typ