Evening star. [volume] (Washington, D.C.) 1854-1972, 1920-12-10
CONFERENCEE ON
/ IN AID Of EXPORTS
NJ i. A. FLEMING.

4HC -S6ahC0-OA CArA wy liz
tportant American bankers confer
ence on foreign trade financing open
ed this morning in Chicago. with
John McHugh, chairman of the A. b
A. committee on aiding foreign BUSH
aess, presiding.
In his opening address Mr.. MeHugh
called attention to conditions existing
before the war; to the fact that ths
United States was debtor nation,
that out of our earnings from rail-
1 roads, mills and factories we sent
abroad each year 5000. 100000 in set
Element of interest and payment Of
dividends.
Europe had loaned to us and invest
ed in large degree in our railroads
and as result our exports exceeded
our imports. I'VE depended on Lon
don to finance such foreign trade al
We had
The pound sterling was> the cur
rency of International commerce. We
had no co-ordained banking system.
no discount market and no machinery
for developing one. We organised no
machinery finance export sales on
sound, orderly, systematic way"
Comparison was made with the
methods Of Great Britain, with for
eign trade it's life blood.
Then came the dramatic change
with the war, when the allies turned
to the United States with the enor-
nous trade from this side. financed
with exports from other countries,
with gold and American securities.
and finally with increasing credit
from America This government
financed the purchases OF Europe by
advancing loans of nearly $10,0G0,-
100000.
When loans stopped the foreign
trade had to be financed some other
way; by the extension of credit by
exporters and then the borrowing Of
the needed cash of the banks, to meet
the shortage of capital.
Thus we see that the extending Of
$4,000, 000.0 900 of floating credit to IA
cilitate our export trade has been one
of the leading factors in bringing
United States and that stringency. in
turn, has been one large factor in
contributing to the recent violent de-
cline in commodity prices"
Mr. McHugh then referred TO con-
ditions of our present export trade
with the great SURPRISES of field and
factory, and yet the irony of it il
that the outside world could use all
the surplus products we might spare
and Europe is still calling urgently
for goods.
1t was in 1918. before the signing
Vi TIC a. tHdt the A. D. A.
realizing the conditions that were
practically certain to come. pledged
itself to use every means to do every
thing in its power to meet the de-
mands of the export trade.
The Edge measure, an amendment
to the federal reserve act, gave the
medium through which the formation
of a bank, with sufiicient capital to
make 1t valuable instrument of in.
ternationai welfare. is permitted. A
the formation Of q one-hundred-miI-
lion-dollar bank; IS per cent Of the
! A. B. A. membership expressing q
willingness to consider making SUBJ
scriptions to stock. The Edge act pro-
vides that corporations may extend
loans to the amount of ten times their
capital and surplus.
National banks are authorised to
invest per cent of capital and sur.
plus, and in many cases state banks
ment of like character in the pro-
posed bank.
Mr.. McHugh paid high compliment
to the Edge act as doing abroad what
the federal reserve bank system has
done at home.
He stated plainly that it was not
the plan of the A B. A. to organize
such a bank on its own behalf. That
il such a bank is brought into being
it should be at the instance OF the
representatives OF the entire coun.
try through united effort to that end"
The plan does not suggest imitation.
What 1t does contemplate is the set
ting aside through. the exercise OF
sane economy of q fair percentage Of
our annual production OF 97O,o00. 900.
1t suggests the investment of that
reasonable percentage thereof In for
eign securities.
Dividend Declared.
Directors of the Capital Traction
Company have declared the usual
quarterly dividend of u per cent.
payable January 1. 1921, to share
holders OF record December II.
Chapter Activities.
W. b Thurston, president Of the
Baltimore Chapter. A. /. B., will talk
to the elementary class Of Washing
ton Chapter Tuesday evening, Decem-
Der II, on Tho Duties Of Note
Teller Mr. Thurston is fully ac-
quainted with his subject, one Of
the very vital elements OF banking.
as il Is the only money maker in the
business. other than commercial paper,
acceptances and investments.