The New York herald., 1921-12-19
OFFER LOANS TO AID
SEINE DEPARTMENT
Three Proposals for Paris and
Suburbs Received From
United States.
INITIATION STILL GAINING
Government Likely to Be Ad-
vised to Relinquish Rail-
road Operation.
INITIATION STILL GAINING

Special Gable to THE NEw YoHK HERALD.
Copyright, 1891, by THE NEW YORK HEaALn
New York Herald Bureau.
Paris, Dec. Is.
Financial circles are expressing the
keenest interest in the offers of Ameri-
can financiers to float loan of several
million dollars in America to cover the
budget of the Department of the Seine.
Although details as to the size OF the
loan and the interest have not yet been
published. we'll informed financiers here
insist that the reports from New York
that the interest will be 10 per cent. are
false. as the loan probably VIII be issued
so as to bring in little more than 7
per cent.
1t was declared that three offers have
been received, one from Kuhn. Loeb &
Co.. Collaborating with the French bank
OF Bernard & Gle; the second from a
group including the Guaranty Trust
Company and the Bankers Trust Com
pany, and the third from an important
group of individual financicrs whose
identity is not revealed.
Approval Is Expected.
1t is expected that the Seine authori-
ties will approve the bond issue next
Thursday There is little doubt that
the Chamber of Deputies will readily
give its assent because of the fact that
by floating the loan in the United States
ii will not take money from French in
vestments, and the fact that the Ameri-
can offer is interpreted as the beginning
of a new era of confidence will go
long way toward restoring French in
dustrial and commercial activities.
Germanys plea of inability to pay the
January and February reparations in
stallments has had little effect on the
Paris Bourse, which had anticipated
such move and bolstered the situation
by means of heavy foreign purchases
The only fluctuation during tho week
here was attributed to the mid month
liquidation. and it Is expected that the
situation will be sufficiently stabilized
within the next two weeks to enable
year end settlements without serious
repercussion.
Bond Interest High.
Some regrets were expressed over the
decision by Paul Doumer. Minister OF
FINANCE, not 10 reduce tne interest rape
Of national defense bonds to the level
of the Bank of Frances discount rate,
experts pointing out that this throws
the burden on the Treasury and prac-
tically creates a state OF perpetual In
| flation.
Although the total OF bank notes is
sued by the Bank Of France UP to De-
cember Is remains stationary at 36,668. :
33S, 400 francs. the actual circulation un-
der the present system is steadily In
creasing, apparently without any con-
| troll by the State.
The railroads are again demanding In
terest. as the new convention. which
provides for operation by n sort OF con-
sortium OF the present owners. Is mcet-
Ing with obstacles owing to the bad
condition of the State lines. A commits.
sion was formed last week to study the
problem and is expected to advise the
| Government to relinquish its operation
Of the lines and intrust this TO tn,
| French corporation.
The bank discount rate averages ~
per cent, with Sls per cent for shor
time loans.