The Logan Republican. [volume] (Logan, Utah) 1902-1924, 1921-03-22
CANADA SEEKS
YANKEE MONEY
EXCHANGE Rates Have Much to
Do With New Development.
THEY USED TO GO TO LONDON

Customs Duties chanoed-Amerl-
cans Already Have a Billion Dollars
Invested in Canada.
4 recent feature Of Canndian.Amers
lean relations which has not aroused
much comment, but which may have
far-reaChing influence, is the readiness
Of American investors 10 take Il mort
gage on Canada and the complacence
of Canadians in giving the mortgage.
More than two-thlrds of the bond
borrowings by Canadians last year
were placed in the United States,
says Toronto dispatch to the New
York World. The remainder Of the
capital was supplied by Canadians
themselves
Not the Whole Story.
The amounts are substantial. Total
bond issues for railway improvements.
| public service corporations. private
industry and municipal and provincial
] governments were $3lS,332. 900. Of
| which United States investors took
$2l4, 1T7,O0O. These figures. impress
siVe though they are, fail to tell the
| whole story Of the movement Of Amer
| lean capital into Canada.
The situation that is being crea ed
is entirely new and Is result to 4
large extent of postwar conditions.
| As recently as 1910 the United States
took only ] Il per cent of Canada's bond
issues. and before 1914 never bought
more than 20 per cent. In those pre-
war days Great Britain was the great
source Of Canadian capital. As the
war progressed outside capital was
shut of and for time Canada be-
came almost self-cOntalned. Now that
borrowing has been resumed II Is to
New York and not TO London that pill.
grlmages are being made.
Exchange rates have much to do
with this new development. When the
Canada. and an American dollar is
worth $1.15. we get In round figures
the following results: $500 In New
York money VIII buy Canadian bonds
with a face value of $575. but f100 In
London money will buy Canadian
bonds OF face value of little more
than $500. II by the time the bonds
mature exchange returns to normal
the New York investor would gain SIS
and the London investor would lose .
like amount on the $500 investment.
] Therefore II Is not surprising that the
supply of British capital Is being cut
Off.
British Capital Vanishing.
What Is happening In fresh issues
In the bond market where pledges are
OF public or semi-publlc character
is happening also in renewals and In
more private transactions. There has
been In the last year or two ire
mendous withdrawal OF British cap
ltal from Canada.
Here is case in point: A Scottish
loan company holds a mortgage for
100000 on manufacturers ware.
house in Montreal. 1t happens to fall
due this month. Under ordinary cir.
cumstances 1t would have been re
newed with an adjustment, II mecca.
snry. OF the rate OF interest But BY
demanding that the mortgage be paid
OF now, the Scottish company obtains
premium OF 10 or II per cent In
British money. And such a demand
Z Is therefore naturally made. II the
Montreal manufacturer cannot raise
the 100000 locally, he goes TO New
York for II.
The same kind of thing Is happen
a ing all over the country. One OF tbs
reasons given for the collapse or al
!. least postponcment in Grant horden'i
e big steel and ship merger, was that
the British investors in the enter
. prise would have lost S5,000,0O0 in ex
= change by sending money to Canada
r at the present time.
Another factor that II helping the
movement along is the familiarity Of
0 American investors with Canadian
e conditions and their obvious coma
dence In them.
The Daughters OF the Empire arr
waging an energetic warfare against
the showing OF American picture tilmi
in Canada and in favor OF the import
ing OF the British product. They arr
touching only one OF the most super
fcIal OF the manifestations OF Ameri
can influence In Canada. II they wan
to get at the real problem they viii
tackle the infiltration OF American
capital into Canadian industry as seer
in the purchasing Of Canadian secur
tiles outlined in the foregoing, and II
the establishing Of branch factories o
American industries.
Protection EVaded.
ProtecHonist politicians for 40 year
IN Canada have urged the necesslr
OF keeping out American imports
canadian industry for the Canadian
people" Canada for. Canadians,
"Under Which Flag2" have been SOM
variants OF the battle cry to which tn
argument lent Itself. Sometimes pro
tectlonists were asked II they wOul,
object II American factories, barre
by the tariff would establish brnnChe