New-York tribune., 1921-02-13
Foreign Trade
Germans Hope
Says Warburg
Hamburg Banker Insists Re.
covery of Exchange Rate.
Depends Upon Early Re.
movalOfEconomicBarriers
Urges Strict Economy
Opposes Artificial Measures
and Asserts Economic Sol.
idarity of World Needed

If further collapse Of German ~
change is TO be avoided it can only b.
accomplished through the recognition
by all countries suffering from n.
effects of the World War of the ona
nomic solidarity of the world .n5
through the removal of all germs os
present and future imitation. in -.
opinion of Max NJ Warburg. OF N.
banking firm Of NJ. NJ. Warburr & O.
Hamburg.
hr. Warburg is not pessi1nistie ovA,
the future, but sees many handicavs n
be overcome and many difficulties !.
the way of accomplishing the des;ro5
results Of paramount importance il
MS opinion is the recovery of Ce,-
many's lost foreign trade and the 70.
sultant return 90 something approach.
ing stability in currency standards
hcIa! measures which would permit the
continuance of imitation.
Mr.. Warburg's views on Gernoa o,,s
economic future, especially as relat;,~
20 the restoration of the German az
change,. were fully outlined in q dis
course ne gave at the annual CONVEX
ton OF the German General Bankers,
Association several months ago,
translation of his remarks has been
published in booklet form by Meyero.
WIZ & Co.. 165 Broadway, dealers in
Ioreign exchange and securities. Mr.
arburg's address caused widespresi
interest in Europe, and it has becn
commented upon repeatedly bv obsey,.-
ers OF the present unsettled interrs-
tlonal situation. The conclusion,
reached by the German banker are en5
tightening and interesting. even tboneb
some of them will hardly meet viii
hearty approval by those who imn,ssG
the Vlctors' terms at the Treaty of
Versailles. "
Recommendations of Banker
a summary of Mr.. Warburg's views
"The exchange of the GERMANY a.
politically and econom;c.iiv
"eakened-cannot for a long time 20
come be equal to that of the strong.
goid standard, pre-wsr Germany.
BY the restoration OF the German
exchange is meant it's ssabilizatior
which, III the interest of our economic
and cultural important middle class
must be brought about at a higbep
level than the present. This will oniv
be possible under the following nre.
llminary conditions:
Tranquility, order and securitv
must exist in the country. These can
only be maintained with the helm of n
strong police and a we'll organized, al
though comparatively small protective
army. For financial reasons the army
must not be a mercenary one.
=, The Star Budget must be balanced.
eXDGn0lfIrPG H. -. =
without previous provision for cover.
ing income. The state must be 70.
ieved OF many tasks undertaken dur.
ing the war; the official list must bs
reduced; diminished Germany can no
longer pay the enormous army Of
bureaucrats.
Economy Necessary
Extreme economy is necessary n
all departments. Ali unnroductive ex.
penditures must be reduced to a mini.
mum.
Very high taxes are unavoidable.
but an overload of taxation skaters
economic life, undermines tax morality
ana o. always disappoints expectations.
lucid. 1F'' NAu
1T Will be impossible for many
years to think of further capital taxes
after the putting into effect af the
war capital tax and the state emer-
gency tax, on top of the high state
income taxes and the inheritance tayrs
winch will prevent the amassine Of
excessive cess fortunes in the future.
:, Inc embargoes on all luxuries and
sIl non-esseDtials are to be strictly
enforced
Must Aid Foreign Trade
Ihe system of foreign trading and
price control Offices must be reorgan-
iized. SO that export trade shall not
pc obstructed, and especially that ex-
sung nng contracts be not interfered with.
ihe expectation of partially and
~hol4y manufactured goods is 10 be
favored IN every possible way. This
can be done by preferential coal de-
i1verles to plants working for export,
ny facilitating the importation Of for
e!gn raw materials to be used in the
preparation OF goods for export, and
ny the banks granting special credit
terms Tor financing export orders"
MI Warburg urges many cheek on
continued imitation, and then discusses
internal conditions. After calling for
an early settlement of the reparations
dispute and reduction of forces of oc-
cupanon, he says that the reprlssi
clause of the peace treaty must be re-
nounced on the ground that mo free
trading and exchange traffic can be de-
Veloped with former enemy countries
uhoer the everpresent danger of re-
pflsais. The clause referred to per-
Inltted the Allied and associated powers
70 reserve to themselves the right Of
taking such measures as may seem TO
them indicated by the circumstances
should Germany Intentionally fail TO
carry out her obligations.
Handicap on Trade
The German banker contended that it
would be unwise for German business
men to place anything of value in
lormer enemy countries that might be
subject to seizure under the cir
cumstances, and he felt that this would
handicap free trading
He also insists that the "one-sided
most favored nation concession that
the peace treaty has forced on Ger
many must be replaced by reciprocal
arrangement, otherwise no intelligent
trade policy is possible for Germany
In conclusion he opposes certain sug-
gestions for loans and artificial stabl~
hzation, saying:
Objections to Loan
There are serious objections 10 an
international loan organization Tor
financing exchange of goods. On the
other hand, Germany must avail het
self of the right TO advances sccordlng
70 Article 235 of the peace treaty lof
the importation OF indispensable 1000
staples.
'No technical or artificial methods,
aimed at stabilizing exchange, snow
any prospect of success. Among THESE
nl,tss !.