The Wisconsin weekly blade. [volume] (Madison, Wis.) 1916-1925, 1920-01-15

american Changes His Good U. s.
Money Into British, French or ltal-
ian Currency Then Buys Goods
Which rle Ships to the United
States, Where, Because of Imitation
of American Dollar, He Reaps Big
Profit
American importers now purchasing
goods in England, France and Italy
for shipment 10 The United States, are
( waxing fat as a result of the depreci-
alton of the pound sterling, the franc
and lira, according to stories now go-
/ ing the rounds Of the New York whole
/ sale district.
The only "fy in the ointment for
! the American buyers abroad Is the
| fact that, by presidential! order sew
| eral weeks ago. United States consuls
are required to keep tab on big pur-
/ chases, ascertain the selling price and
| cable these facts to the United States
! customs authorities. Then, by figur-
/ ing the rate Of exchange on the date
! of purchase the government is enabled
TO set proper value upon the goods
for the collection of import duties. A
court of claims passes upon what are
alleged TO be unfair appralsals.
How II Is Done.
The situation Is said to be somewhat
Ike this:
An American buying pound sterling
say. on December 10, needed to pay In
American money only S3.66 for British
currency normally worth about $4S7.
Now he goes to factory In Noting
ham, England. to buy laces, and there,
although prices of course are higher
than before the war, he pays for them
in this deprecated money and makes
a handsome" profit. Then he ships
the laces to the United States, where
by reason of the Imitation Of the Amer
lean dollar. they are retailed for from
100 to $50 per cent above prewar
prices.
The same Importer on the same
date, we will say. goes 10 France. In
Paris he has exchanged his American
dollars for francs. Normally there are
5.1Sh francs TO the dollar, but now he
finds one Yankee "smoleon" will buy
1882 francs, about 60 per cent more
than before the war. The price Of
silks has gone up, but he goes to Ly-
ons. and there. with his deprecated
French money, he buys more than he
has ever bought before at bargain"
prices The silks reach New York,
where they are sold to the consumer
at double their former retail price.
Next this importer visits Italy.
where he finds the Ira, 51SM OF
which. like the franc, could be bought
for one American dollar, now at a vast
discount. In fact. he receives 13.47
lira for one American dollar and. well
fnan ced. he goes to Naples, where he
negotlates the purchase of tapestries
costing, of course. more than In 1914.
but in reality cheaper when purchased
with the present italian currency.
The same financial conditions exist
all over Europe, and I'm the former
central empires, Of course, they are
reported much worse. IN the allied
countries. however. where there Is ma
tonal stability ana greater ability to
pay, the deprecated money is effect
ing some strange changes. A dinner
which. before the war, In Paris could
be had for q nominal sum, now costs
from 20 to 80 francs.
American manufacturers, mean
while, who desire to sell their products
abroad. are demanding payment In
American dollars ct par. Recently the
I h. L. ..of hon uvhf
20 American locomotives, for which
pnymenf. instead 0f being in Belgian
money. was demanded in American
dollars. thus adding from Is TO 20 per
cent to the manufacturers normal
profit. Naturally this dlscourages for
eign buying.
Cancels Big orders.
on the other hand, big American
locomotive concern, apprehenslve OF
the turn Of political affairs abroad,
due to delay over the peace treaty, is
reported practically to have Cancelled
all foreign advance orders Such or
ders, calling for delivery in three. six
or nine months. are said TO be prac-
tically non existent in the locomotive
trade. Similar conditions exist in 9TH
er industries. That = why American
manufacturers have Jeen saying: "If
the pence treaty is not soon signed 1t
Will mean the complete loss of our
foreign trade"
There are committees Of the most
prominent United States bankers and
business men. representing the Ameri-
can Bankers association, the United
States Chamber Of Commerce and the
internatiouei trade conference, who
have been at work on this problem OF
foreign exchange for months, and who
will be ready to remedy the present
situation as soon as the peace treaty
becomes a fact for the American ma
ton.