The Washington herald., 1921-08-30
EAST EUROPEAN
EXCHANGES sink
follower LEVELS
Currencies of Germany,
Austria, and Poland
Suffer.
MARK AT NEW Low
Disappoint Those Expectinl
Recovery on Strength Of
Holland Credit.

AMSTERDAM. Aug. I3.-The curl
rencies Of Central Europe durinrl
the past few weeks have displayed
extreme weakness. The decline oil
the German mark and Of the Aus
trisn crown reflects increasinE
financial difficulties, while the pa1
nubian countries are experiencing
adverse conditions arising from the
impaired purchasing power Of their|
chief customers and from dfficultiesI
in transportation and the exchange
OF goods.
The German mark has recently
reached a record low level, and this
was a Disappointment 70 those who
expected its recovery when Ger
many obtained a credit OF 2OO, 900
900 gold marks in Holland and when
other countries supplying Germany
with raw materials and foodsturs
offered credits to assist her in the
Importation of such commodities.
These favorable factors were offset
however. by the necessity OF meet
ing other obligations. This led 70
the loss by Germany OF such yslu-
able assets for upholding exchange
as the silver reserves.
Speculation Depresses Marks.
1t Is recognized in financial cir
cles that the reparations PAYMENT.
will prove to be a very serious OBJ
stcle to the full recovery Of Ger
many or even to a substantial i'm
provement in her balance OF trace
for long time 10 come. 1t must
not be overlooked that large ouan-
titles of German marks have been
brought up for speculative pur-
poses in the principal money mar
kets OF Europe and America. Il
was expected that German trade
would recover and bring about an
improvement in the price Of marks.
though IL was not believed that the
mark would APPROACH anything like
its prewar value with a measur-
able space OF time. Foreign holders
OF marks have become skepticaI OF
the value Of German money for in
vestment or speculative purposes
and show an inclination to part
with their holdings whenever there
is even slight Improvement
The advantages accruinE to the
German export trade from the low
rate Of exchange are threatened
again by the possible loss Of the
Industrial and mining districts Of
Upper Silesia and by the general
economic depression which has
brouEht about a decrease in the
worlds buying power, and last, but
not least. by the protectionist move
ment which is sweeping over all the
important countries. A new pro-
tectiNe tariff was introduced a few
weeks ago in Italy, imposing higher
duties on goods imported from
countries whose currency is depre-
cisted in terms Of the lira. The
proposed Spanish tariff contains
similar provisions In France an
important rise in customs duties has
been announced. and some Of the
newer States. such as Finland. Po-
land. and Jugo-Slavia. have likewise
established protective duties.
German Prices Advancing.
The progress of tariff protection.
coupled with the continued arpli-
cation Of tho Sanctions" will proh-
ably prevent any great expansion Of
German exports. Germany's pur-
chase on large scala Of foreign
exchange has further depressed ythe
mark. not only in the International
market. hut also at home. The
shrinking purchasing power of the
mark in Germany is shown I'm the
steady upward movemC Mt OF prices
in that country.
The Austrian crown has also
fallen 10 a record low level. This
has been accompanied in Vienna az
in Berlin, with an enormous rise in
the prices OF securities and heavy
speculation on the stock exchanges.
The proposed financial assistance or
Austria by the league OF nations is
not vet forthcoming The Polish
mark has recently registered
record low price. and IL was an
nounced a short time ago that the
defcit in the Polish budget
amounted TO 73.OOO. 400. 600 marks
Hungarian crowns registered some
improvement last spring after the
optimistic declarations OF the
finance minister. hut the failure 70
establish financial equilibrium
was followed by further deprecis-
tion.