The evening herald. (Klamath Falls, Or.) 1906-1942, 1920-06-07
MONDAY. JUNE ,. ,sso
BRITAIN BESTS
j. 5. IN LOAN
To ARGENTINE

BuENOS AIRES. May J. tBy
NaiD ALTHOUGH the agreement on
the part Of the British government
10 pay off the s5o.0oo.ooo owed by
ArEentina to United States bankers,
payabie May rs. has been hailed here
- "an act Of friendship" official
Dublicity has not, yet been given TO
sAe understanding in banking circles
that the agreement was only . con-
ditionai part OF an ingenious finan-
eial arrangement which enables
Great Britain TO pay her own hun
dred million dollar debt to Argentina
without sending 10 this country
single cent.
Not only is this $50. 900 900 to be
credited by Argentina against Great
Britain's obligation. but the remain
tng $50 .o00. 900 after being renewed.
h TO be gradually extinsuished
through an arrangement whereby
Great Britain for q certain period
pays in London the interest on the
principal part OF Argentina's externa!
debt, bankers have learned.
Thus far the Argentine govern
ment. which was unable to get q re-
nevai OF the loan in the United
States. has made public only abe fact
that Great Britain has agreed 10 take
care of the obligation In behalf OF
Argentina and La Epoca. the govern
@ent organ has praised the transae-
tiou as an evidence OF Great Britain e
friendship to Argentina and Of great
promise for the future relations OF
the two countries. Pc
Bankers say there is no doubt but
that the payment by Great Britain Of
Argentina's debt has greatly increas-
ed the prestige OF the British In this
country and has been corresponding
" detrimental TO that OF the United
States but call attention to the fact
that the transaction Is not without
It's advantage TO Great Britain also.
II regret 1t very much" said one
Argentine banker 10 the Associated
Press correspondent, but fear the
failure OF the American bankers 10
renew our loan and the fact that
Great Britain has stepped into the
breach and paid II. mean a loss OF
economic good will toward the United
States. While the complete transac-
tion is a good business deal for Great
Britain, the fact stands out In public
opinion that the British did what tine
Americans would not. We in finan-
cisl circles understand that money is
badly needed for domestic purposes
In the United States. Nevertheless.
Britain and America are represented
as waging a commercial contest for
trade in Argentina. The economic
effect Of the transaction in favor OF
British prestige is obvious"
As told in local banking circles, the
best terms that Finance Minister
Saiaberry could get from the Amer
lean bankers n lis r.cent trip to the
United States was a renewal of the
s5O.OOO.OOO for i've years at 7 per
cent the bankers asking delivery OF
the new bonds at 92 which would
have been equivalent to an interest
OF 9A per cent. The maturing loan
was at 9 per cent.
Turning to the British government
through a prominent Anglo-Argen-
tine bank, the minister was able to
get a loan Of $5o,oO0,0OO at s per
cent to pay off the Americans. This
he was able to do, It is pointed out.
because of conditions which able
Great Britain to pay her own obliga-
tion to Argentina, a. 100000. 900
credit for cereals. on favorable terms.