The Lakeland evening telegram. (Lakeland, Fla.) 1911-1922, 1922-05-18
EUR0PE'S BOOKS.
MUST BALANCE
SAYS VANDERBILT
Noted New York Banker
Makes Expert Report
On Finances In Which
He Points To the Ne
cessity Of Reduction
Of Huge Arrnaments

Washington, May 1S.-"Most of the
central banks in Europe today are in
varying degrees of insolvency Frank
A. Vanderlip, New York, declared in
cabled review of the Genoa confer
ence, sent to the annual convention
OF the Chamber Of Commerce of the
United States. "The plan for a con-
ference in London of such banks
promises little immediate result. he
said. Their proposed cooperation in
the solution of Europe's financial
difficulties would be difficult to real
ize.
Describing the Genoa conference as
a clinic" which was circumscribed
in the type of diseases which it
might discuss Mr.. Vanderlip recon
mended that the United States enter
the proposed London financial meet
ing but "only with the understanding
that our federal reserve system be
kept free from alien commitment"
He commended the Washington
government for the attitude it has
maintained toward Europe, and said
the chamber should refrain from en-
barrassing it by'suggestions.
Officially the conference was not
even permitted to examine the dis
ease,' Mr.. Vanderlip said, 'neverthe
less unofficially their ills had come
to be better understood. Their dis
eases are the Enthusiastically increased
reparation claims, of excessive mill
tary expenditures, causing inevitable
unbalanced budgets; of boundary
hof IN
ical conditions; interest and govern
ment debts so vast as 20 destroy
the hope of solvency-these diseases
could not be officially studied and
diagnosed The disease of the eco
nomic isolation of Russia, having a
population equaling nearly one-tenth
of the world, has been studied, only
to be referred to further study by
The Hague conference.
"Only the prohibition on discussing
more important subjects, the impor-
tant economic condition of Russia,
has been emphasized. Under the most
favorable agreement conceivable with
Russia, that country would not be
able to make any important contri-
button to Europe for several years.
An agreement with Russia when OBJ
tanned, will, for a long time. only
furnish an opportunity to send goods
on crcedit. Little or no Russian pro-
duction can be returned in exchange
for several years.
'The financial resolutions adopted
are sound, but at the present unnec-
essarily ineffective. They declare the
stability of currency value requi-
site for economic reconstruction. That
is impossible of accomplishment
while budget deficits persist. Bal
anced budgets must await reduced
military expenditures. Disarmament
could not be discussed here, but must
be before budgets can be balanced.
Therefore reduced military expendi-
lures are a prerequisite to stabaliz-
ing currency.
american participation in the Lon
don conference is highly desirable,
but it is important, however, that we
should not endanger the custody of
our bank reserves in extending cred
its to establish European bank re-
serve.
II believe America should study
plan for segregating part of her
gold stock to help Europe build up
her resources after her debts are
balanced. American gold reserves
are SO large that they will otherwise
invite dangerous imitation. Our fed
eral reserve systems, however, should
be kept free from engaging alien
commitments. We might organize
parallel institution to cooperate with
the central banks of Europe and thus
avoid any unfortunate commitment of
the federal reserve system.