The New York herald. [volume] (New York, N.Y.) 1920-1924, 1920-10-29
CONSIDER SOUTH
AMERICAN LOANS
Bankers in Favor of Advances
to Brazil, Chile and Argen-
tine Republic.
NEEDS ARE $60,000,000
Local Opinion Is Money Should
Be for Purchases i'm the
United States.
NEEDS ARE sso,ooo,ooo

Loans of between s5o.ooo.Ooo and $780,
900. 900 in the aggregate to three South
American countries are under considera-
ton OF local banking groups. 1t was
learned yesterday following protracted
meeting Of members of the. South Ameri-
can group Of bankers held at the offices
of ]. P. Morgan & Co. The minimum
financial needs of Brazil are $4,000. 900 !;
Of Chile. s1o.ooo.ooo: of the Argentine
Republic. 100000. Those needs have
been set definitely before the local bank
ers who must Initiate loan proposals, but
no surprise should be shown TT an early
announcement of the fotaton of loans to
each of those three countries In
! amounts sufficient, at least, to satisfy
the bare minimum requirements.
Following yesterdays meeting Thomas
w. Lamont made the remark for publca-
ton that no specific application for
loan had come before the group, and he
declined TO express an opinion as to
how soon actual specific loan negotia-
lions would be conducted by cable.
Nevertheless 1t was learned that the
bankers went exhaustively into an anal
ysis OF the conditions In those three
countries. and tho general consensus
was that loans should be made.
provided that the purpose was not pri-
marfly to bolster exchange but to enable
those countries to continue purchasing
IN this country and pay for purchases
already made.
The disturbances In the purchases
and sales of commodities in this coun-
try are duplicated. IL not exceeded. In
those South American countries. At the
same time there Is stacking up Of
commodities. The Governments of those
countries are hampered financially by
too low rate of taxation. The evil
dence of South Americas commercial
condition Is found in the steadily ad-
verse movement of exchange with those
countries as expressed in terms Of the
dollar.
The most imminent of the loans now
under consideration is the fiotation OF a
$30,O00.O00 loan to Brazil. There was
plan to finance the Brazilian Govern
ment needs with an acceptance credit
for 20 per cent. of the requirements, to be
followed later by asbond issue. The terms
OF the acceptance credit, as stipulated
by New York bankers were found un-
acceptable by the Brazilians and now
the only proposal is that Of negotiating
purchase of securities from the Bra
those included in the South American
group are dickering with the Brazilian
Government and the spokesman for the
organized group was asked regarding its
attitude toward such negotiations. He
replied that the group welcomed the
efforts Of the other bankers and would
put no stones In the path OF successful
contamination of the loan. On the other
hand. the group, with its powerful or
ganized backing. stands ready to do
what can be done practically to extend
proper credits to those countries.
Contrary to general impression, credits
for Cuba or for Mexico are not sub
ject for action by the South American
group as an organized body, and, also
contrary to published rumors. the ex-
tension OF credits to the Brazilian Gov
eminent would not be made to keep up
the price Of coffee or other Brazilian
products. The fact is that dollar credits
here are needed urgently by the Gov
ernments Of Brazil. Argentina and Chile.
and the prospect of the early extension
Of such credits Is considered excellent
WASHINGTON, Oct. 28.-The Bolivian
provisional Government has floated an
Internal loan sufficient to provide funds
for the payment Of 100000 franc
debt to France, according to an an
nouncement by the Bolivian Legation
here. 1t was originally intended by the
Bolivian authorities to convert the
French loans with money borrowed in
New York. the statement said, but the
arrangement fell through following the
recent coup d'etat which resulted in the
transfer Of authority to a new party.
Bolivia Is now negotiating In New
York. the legation also stated, for a
$4,000. 900 loan with which to complete
the Pan-American Railway link. de-
signed to connect Its railway system
with that Of Argentina.