The New York herald., 1921-11-21

for her raw materials. But even II this
were to be the case. 1t should be borne
in mind that the cost Of raw material
does not usually bulk more than one
sixth in the eventual price Of the nm
lshed commodity. and that the other Ave-
sixths are made up Of labor and distri-
button costs. overhead. &C.. all of which
are in this case expressed in terms Of q
deprecated currency.
In the case before US. however, the
fact should be taken into consideration
that Germany Is surrounded by nations
whose currency is even more heavily
deprecated than her own and from
whom she can secure much Of her needed
raw materials under extremely favora-
BILE conditions.
1t Is n mistake to assume that de-
preciated currency is necessarily de-
structive to the industrial prosperity and
development Of nation. a fact which
has been demonstrated time and again
In the experience Of the various South
American countries. AS long as the
domestic values however expressed. are
held relatively stable, such depreciation
may really be a blessing in disguise for
debtor nation. In the Teutonic in
stance there is said to be currency
emission now approximating eighty-one
billions of marks, which at 0.35 cents a
mark. the existing gold value. would
total but s2s3.500,0 900 gold. more or less
SIS per capita. a ridiculously small charge
when Germany's resources are consid-
cred, and one which is entirely unjusti-
fed, even taking into account the possi-
bilities Of the printing press.
AS nearly as can be ascertained the
existing internal depreciation is ex-
pressed by a figure of one-tenth of the
normal value OF the mark, while that
on the international exchanges is indi-
Gated by one-seventieth. a disparity
which can be explained only by the
heavy weight imposed by the repara-
tions payments.
Such situa ''on is bound to attract
the gold Investments OF foreigners.
thereby causing an influx of foreign
gold. movement largely dominated by
political considerations and the pros
poets of political stability. and which In
the long run will strongly tend to raise
the value Of the mark.
In the meantime the German Govern
ment secures the necessary gold In the
markets Of the world, thereby depreciat-
Ing the value Of its currency. but at the
same time tremendously stimulating the
export industry of the country; at the
same time 1t creates a condition which
absolutely shuts out all imports except
those OF essential raw materials.
The merchant and the manufacturer
benefit greatly, the German people as n
whole pay the bill. but they would have
to do 1t in any event as reparations; In
reality the commercial interests of the
allied countries are furnishing the money
with which to liquidate these reparations
at the expense of their industrial and
labor interests.
II the present movement is unchecked
Germany will inevitably regain the mar
kets of the world. and after reaching a
certain level the fall of the mark will
be checked and then begin to rise.
finally becoming stabilized, conditions
which will mean for certain other coun-
tries an agony OF liquidation and COM
mercial depression.
No legislative body has ever faced
greater problems than the Industrial and
economic questions which now confront
the Congress OF the United States.
WHITLEY c. BURNS.
MoNrcLAIR, N. j., November 10.