The New York herald., 1921-01-03

tries. and while something was done in
that direction the movement was re-
stricted for the most part to alien resi-
dents. The placing of those loans in the
United States made II possible for the
foreign borrowers 10 fortify their tnan-
ctal position. provide themselves WIFE
ne tcessary machinery and raw material
and obtain equipment required to restore
their productive organism 10 as near
prewar basis as their resources would
allow. IL was financial relief work o.
the best sort and has done more than
Almost anything else 10 put Industrial
Europe on its feet and set many thou
sand idle men at work. There is more
voring conditions the movement viii ex-
tend probably throughout the new year.
because this nation Is vitally Interested
in righting things abroad and thus maxi
ing possible increased production in the
large area which is purchasing most OF
its supplies in the United States.
1t is only twenty years since S2O,-
900 900 purchase cf German ExcheQuer
notes by an American banking house at
tracted International interest as the first
occasion when a great foreign Govern
ment had placed a loan in the united
States. Berlin soon bid high enough
holders to sell out and thus end the con-
troversy which arose in German banking
circles over the foolishness Of the Ex-
chequer authorities in applying to for
eign market for funds. Taking the
SO, 900. 600 900 OF foreign securities owned
here at the close OF the war, IL is prob
able taat the total of such holdings mas
reached nearly $4,000, 100000. allowing
for recent sales of some of the securities
10 the markets which issued them. The
decision TO pay off the s50OOVo,ooo
Anglo French loan when 1t matured ON
October Is did more than anything else
to bolster up the American market Tor
foreign Government securities.
Year of Record Financing.
Considering the extent of the foreign
government financing here and the pro-
dlgious sales of securities for domestic
corporations, il is apparent that 1870
holds the record for total new capital
financing in the United States. For the
first eleven months of the year domestic
corporations sold more than S3,0OO,OOo'-
900 of bonds, notes and stocks while the
United States Treasury at frequent in
tervals borrowed heavily from the money
market through sales OF Certificates of
Indebtedness. With those huge borrow
ings by foreigt governments. domestic
corporations and the United States
Treasury, it is easy to see that the year
was one of intense banking activity and
total borrowings for all purposes greater
than during any previous peace year. In
some respects the credit strain was more
intense than in war times. because every
one realized that falling markets were
not at hand and that to keep solvent II
would be necessary for manufacturers.
jobbers, wholesalers, merchants and pro-
ducers to buy carefully on a hand to
mouth basis and not to overstock at
high prices.
The cut in retail prices announced in
May foreshadowed the much more serl-
Gus decline of October. when the nation
wide price cutting campaign was
launched first in the automobile indus
try and extending soon to all branches
of Wholesale trade and various retail
lines Since October the effort has been
to develop a price basis on which broad
public buying could be attracted, never
easy to do because when prices are fall
ing buyers hold off and pursue a backing
and filing policy until assured that the
bottom has been reached. No one knows
lust when low level will be touched. but
it will come Unexpectedly, because buy
ers OF stocks and bonds resemble a flock
of sheep and are apt to follow a strong
laadar