Perth Amboy evening news., 1921-07-12

abroad, to be paid for in ninety days, may find
a material change in the exchange rate which
makes the purchase cost either considerably
more or considerably less than was bargained
for. The net result of this has been to encour-
age gambling and speculation, buying goods
with the idea that when the time came to pay
for them the cost in American money would
be less.
In the present situation. the nations whose
money is depressed in value are not the only
sufferers. The United States. whose money is
at a premium, is hurt very badly, too. Foreign
business men cannot afford to pay for American
goods on the basis of American money values
This materially cpts down the export of Amerf-
can goods. which in turn reacts on the amount
of production. and works on down the line sc
that there Is an overplus OF labor, and prices
and wages are forced down, too, by the opera
ton of the law of economics known as supply
and demand.
Foreign nations, with their money depre-
ciated, look to other nations where the money
standard is not so high to supply their needs.
As an illustration. suppose that France is In
the market for a lot Of wheat.
The United states could supply this wheat.
and so could Argentina. The price asked, let
us say, is 81 a bushel in each case. However.
the money of Argentina being at a discount OF
about thirty per cent. compared to the Ameri-
can dollar, the Argentine price means that
France can get the wheat it desires from
money to $40 Naturally. this business goes
TO the South American republic:
Impractical Remedies.
Hundreds of cures for this situation have
been advanced by theorists, but all of them are
rejected by Government experts. Ofncials OF
the Federal Reserve Board know that the age
Of miracles is past, and caution against expect
ing q sudden swapping back to normal con-
ditions throughout the world today, tomorrow,
next month, or next year. the restoration VIII
will never again reach the point where their
standard Of money will have the value 1T did
the World War.
The situation can best be benefited only when
the countries of Europe stop Quarreling and
among themselves and settle down to
where the nations there instead of trying to help
each other and help themselves, have apparently
been bent on cutting each Others economic
The parcelling out OF Europe INTO
many new nations has given rise to much or
this sort Of thing. For instance, integral parts
of the old Austro-Hungarian Empire nave Dee1
prime offenders. For a long time Hungary wouio
allow none of its wheat to go to Austria IN
for Austria refusing to let It's manu-.
featured y s9 %Sa H Henasa ey H eunid not aea GET ' tho
clothing and machinery they needed. the AUS
TRANS could not get the food they needed. me
benefited no one, and hurt both coun-
have to have dealings. ,
It has often been proposed that the United
clean the slate on which are chalked down tne
Of foreign nations tor the United states.
These debts are owed to us by our late alles'
ton of the war to a successful conclusion.
Government experts are inclined to look upon
this suggestion with the idea that 1t woula 40
OF III kOOus - WYNN ~ NSo -.
the financial obligations of certain foreign
nations, but these experts say that unless tne
common. everyday citizen of those LANDS penee
flied, it would do no good. For instance, II
the French debt to the United states
were accomplished, there would follow a lessen-
ing of the tax burden on the e, arem mem pe co',id
dictate how this should be done, there wouie
be no surety that the ameliorated taxes Woulo
Of the French franc would be appreclated
at all, which is the only way America couio
benefit from this transaction.
Also. it has been said and is probably true in
some instances, that the limit of taxation on
many foreign countries has been reacheo. IL
this is true, and these countries cannoL now
States-about a billion in back interest is unpaid
at this ~time-wiping the slate clean OF the dept
would accomplish no good at all, either Tor tnae
nation, the United States. or the rest OIL the
world.
Some of the countries partaklng OF the 1er-
man reparations have suggested that IN eX-
change for their obligations to the United STATES
that the American government accept the Ger
man bonds which some Of our late aIles rm moi ID
that by France for instance, holding German
bonds, and America holding French oonds. !.
Just makes an extra TRANSACTION io oo,iects from
then the United states collects irohi
France.
TO turn back the direct obligations of our late
allies, in exchange for the obligations OF the
late enemy nation. This is not because OF rear
Germany would not be able to pay the
interest charges and the principal of this obhga-
ton in time, but because of the situation wnlch
arose out of the peace conference.
Nv returning French bonds to Paris. Tor
instance, and taking the equivalent in German
obligations which France now holds, 1t would,
1t is feared. put the United States In very mucn
the same position as if it had Joined the League
of Nations, lock, stock and barrel. TIT present
administration and the present senate ma1ority
is OPPOSED to this. The virtual memoersnlp IN
- 1yo,,ld bo hocauSo IL would give the
United States a direct and deep interest in pre-
serving the solvency- of the German nation.
The ramifcations to which this would give rise.
government financial experts say, would MAXI
necessary American participation in the anairs
of Europe, with all Of their conflicting interests,
to an extent to which 1t IS not tnousnI 'he
A y, arinan manila would cQuntenanCe. -