The Bridgeport times and evening farmer., 1921-07-29
RECOMMENDS
 SYSTEM FOR
 RECONSTRUCTION

Buenos Aires, July 29.-Recon- struction of the monetary systems of those countries whose currency has depreciated, on the plan followed by Argentina in 1899, is recommend ed by Carlos A. Tornquist, interna- delegate to the Brussels financial cons ference last year.
 Adoption of this plan, he told members of the American Club at a luncheon here had fixed a permanent
 value for Argentina's then fluctuat- abled the country to emerge from
 monetary chaos into economic sta
 bility and prosperity. Many of the leading men in Germany he said,
 monetary reform patterned after Ar
 gentina'S.
 Explaining the mechanism of the
 plan, of which his father was the author, Senor TornquiSt said under the Conversion Law of 1899 by which it was carried into effect, O value of A cents gold was fixed for the paper peso and the national f1nan-
 ciaI institution which the law created,
 was authorized to deliver one paper peso in exchange for that sum in gold and vice versa. The value, he said,
 was fixed very much below par, be- cause the depreciation of the paper
 money had become a permanent one and because values had become ad- justed to the depreciation, "that is to say, that, apart from the fluctuations liable to be produced by abnormal causes, the real value of the paper peso measured in gold was A cents." The public immediately responded to the law, having confidence in the plan, with the result that the value of the paper peso became more and more stable and it ceased completely +n f11,ot had obtained only 8 modest stock of gold. This stock has constantly. in
 creased, from barely S3,00O in 1902, S 100000 in 1905, to $47o,0o0,000
 iation of 2e3, ,000,O 900 paper pesos was
 assimilated and placed on a parity
 with the emissions subsequently made
 on gold basis. Today, he said, Ar | gentiEa had a paper circulation of about 1,350,00O ,00O pesos backed by a
 metallic guarantee, which, according to the rate established by the law,
 amounts to SO per cent.
 'I believe,'' he continued, 'that the existence of such a high propor-
 tion of yellow metal gives me the right to affirm that Argentina money
 is today among the soundest irr the whole world-''
 The result had been that from the
 time of the sanction of the law, for eign capital had flowed into the
 
 multiplied, commerce attained extra
 ordinary proportions, immigration
 increased, until Argentina produc- | ton today is one of the essential fac 1 tors in the worlds markets in pro- | viding foodStuffs for mankind and
 raw materials for manufacturers Senor Tornquist advocated as the
 first remedy for the European eco l homie disorder, adherence to the | recommendations of the Brussels l ~ | suppression of subsidies and ecooInic barriers, the reduction of armament expenditures and d-suppress1on Of un- 1 productive works and even certain productive.
 tfIf they will follow these sound recommendations from the Confer
 ence of Brussels,'' he continued, cit is my opinion that many countries will
 in a relatively short space of time,
 be able to place themselves ina nor
 nal economic condition, under which l their production and consumption l will be maintained in a proportion 1 permitting the liquidation of the ob-
 Hgatons contracted by reason or the
 war. Then, in my opinion, will De
 the time for these nations to begin to
 think of readjusting their monetary systems
 l ftIt does not appear to me possible
 to effect this reconstruction Of none | tary systems by means or d1s1nfia- ton for this would be a slow process and would not do away with the fluc- tuations in the value of money; and. worse still, it would impose complete l ly unnecessary sacrifices upon 1nous- try, commerce, and producuon- "On the other hand, I consider the Argentina example perfectly feasible for many countries. Our conversion law, it's origin, it's result, it's economic | effects, I consider a subject of great importance and great practical pos abilities for many countries, and I
 think the sooner, and the more, your
 country does in this idriect1on, in view of it's enormous moral and ma problems the better it will be-