Every evening, Wilmington daily commercial., 1921-10-08
Babson Sees Collapse
of the Mark
Business Prophet Points Out Lesson
in German Situation
(All Rights Strictly Roserved)

"a friend of mine has recently been
In Germany. While there he won some
money In poker game. When he
went to cash In his chips ne was told
to wait a minute. Ho waited two hours
and got his ron OF Mark notes and all
press. That Is the way German
Marks are being turned out today
Germany Is full of Marks; but they
are only made of paper. So long as
the Germans can sell American paper
st such fancy price pound. they
will continue 20 print Mares
"The value OF paper money depends
Ion two things: the gold reserve to re-
deem It. and the credit of .hc govern
ment behind e. There are millions of
Marks afloat in Germany which can
never be redeemed In coin. In fact Il
ia a Joke TO think OF that as a nossi-
bnity. As for credit, the German gov
ernment Is not on its feet yet and no
one has very much confidence in IL.
"The international bankers are ex-
tending credit to German business
firms. I'm spite of the German govern
ment. because they have confidence
I'm the industriousness OF the German
people. These qualities are entirely
independent of the number of Marks
turned out In Berlin German bust
ness men and German workmen can
and will produce. English and Ameri-
can bankers know IT, and for that
reason they will continue 20 arrange
credits for German firms in spite Of
the fact that the Mark Is still falling.
Now that the Mark has hit bottom
and gone thru the Germans are rush
ling the stock market and buying stock
like crazy men. That country is in
Ia fever OF speculation. We saw that
kind Of fever here two years ago.
Stocks hit the top Of the thermometer,
but they came down again and lot
OF people got hurt
AT the present time !n Germany
nobody trusts the Mark. Accordingly
everyone wants to turn Marks into
securities. Farm hands and servant
girls are buying stocks. People will
take anything IL only they can get Sc
lcurities in erchange for Marks Soon
er or later the tide of speculation will
turn. Stock prices will tumble and a
number of Germans will be wonderins
whether they are better off with the
worthless stock certificates than they
were with their paper Marks.
"Gcrmany's position today is perfect
testimony 20 the fact that al financial
dealings are finally determined by the
fundamental laws OF right and wrong
lGerman business is getting credit from
bankers in former enemy nations be.
cause the German people are indus.
trious and dependable. The German
Mark has dropped out OF sight be
cause the government put out a 10
OF worthless paper money whicl
: people are now unloading wholesal
in exchange for stock. This is VIII,
. the Mark which was worth almost Al
. American quarter seven years ago /
: now worth less than cent.
Both the German government an
2 the SPECTATORS have been busily en-
1 gagged in an effort 10 get something 10
nothing. That attempt however, ha
( never succeeded and never Will. Some
! thing for nothing does not exist. Wha
we get we pay for some way or an
other. The common people in Ger
| nany know it. and the New Yor
hanks realize that they know It Thi
is Germany's salvation. When tn
leaders Of Germany also learn thi,
. | they will reorganiZe. In the mean
. tune look for financial firework,
= With the German government fol
= lowing its present practice the fu
'ure of the Mark depends upon IN
: market price for waste paper.
There IS a little change in tn
situation in the United States. Busi
= ness is now 72.5 points below norma
compared with S2.5 points below
month ago, and the low OF 1I0 point
q below which occurred during Marcf
II, however. we will learn a lesso
= from Germany and quit trying 70 sc
4 something for nothing business re
( vival win be greatly accelerated.