Evening star., 1921-02-26
Gives Tentative Backing to
Plan to Use Seized Hold
ings as Security.
S40O, 1000, 1000 IN CUSTODY
COULD FINANCE PROJECT
Proposal Would Require Act of
Congress and Treaty With Ger
many to Garry Out.
RY nNyIn LAWRENCE
BY DAVID LAWRENCE.

President elect Harding has given
his tentative approval to what may
amount to a billion dollar credit to
pie of central Europe to buy Ameri-
can goods and products of which
they are in serious need.
The plan as outlined to Mr. Hard
ing by New York bankers contem-
plates the use of the securities held
in the United States by the alien
property custodian in behalf of Ger
man citizens. This is estimated to
amount to at least $4OO. ZOO, 900. be-
cause the remainder of what the
amen property custodian has really
belongs to citizens of Austria. Poland
and CZechoslovakia. and under an
amendment to the trading with the
enemy act passed by Congress the
property of those citizens must be
returned to them when they claim it.
Basis for Loans Here.
1t is possible, of course. with four
hundred million dollars placed as as
sets in single corporation to raise
other funds for credit purposes
either through Americans or Ger
mans interested in the financing of a
huge export project of this kind, but
inquiry here discloses the fact that
II the proponents Of the idea had
the notion that a billion dollars of
securities were available for the Ger
man credit. such is not the case
Broadly speaking, the approval by
Mr.. Harding of the plan does not alto
grther assure its adoption. for an act
OF congress viii be required before
the alien property custodian can re-
lease any of the securities or property
which it now holds All the cash be
longing to Germans is in the United
States Treasury and by law cannot be
invested in anything else but liberty
bonds
Will Require Agreement.
The plan, moreover. would require
an agreement with the German gov
ernment whereby the owners of the
property would permit the Berlin
government to use the securities in
the United States as a basis of credit.
and would renounce all claims against
tne american government in connec-
ton with the new enterprise
1t cannot be said that banking opin-
ION is altogether unanimous as to the
wisdom of the scheme, for some au-
thorities claim it tWould be wiser to
turn back the four hundred million
dollars to the real owners and let the
Germans do with it as they please. the
theory being that the Germans will
perhaps find the most effective way to
invest their own securities so that
trade will be revived.
There is also the suggestion that II
the German owners get their assets
back they may be in position to
borrow funds wherewith to pay Amer
lean firms to whom they already owe
large sums of money and stimulate
trade that way before engaging in
new purchases.
Merchants Want to BE Paid,
While American merchants are eager
for foreign markets, they are oh
viously not anxious to sell to CUSTOM
ers that have not paid or will not paw.
The whole question as to what shall
be done with the German property
in the United States can be settled
alone by Congress. The office of the
alien property custodian is simply a
huge trust company, which has held
the goods for disposition by Congress.
1t is probable that the next Secre-
tary of State, Mr.. Hughes, will weave
the matter into the commercial treaty
between the United States and Ger
many whereby it is intended to dis
pose of all questions between the
United States and Germany growing
out of the war without taking over
any of the obligations of the treaty
Of Versailles.
Copyright. 1921