Evening star., 1922-12-26
ALLOW
TO CzECHS' TRADE
Closing of Factories Follows
Rise in Value of the
Crown.

nISC III vQluC VI VIC
! Crown.
BY A. r. DECKER.
Especial Correspondents Of The Chicago Daily
News and The Starr
| PRAGUE. Czechoslovakia, December
| 25.-The Czechoslovak government has
i1s"ed an appeal to the people and the
| industries. The people are asked to
look around for bargains, and the in
dustries are asked to provide the bar
gains.
Czechoslovakia is in a period Of de-
, fation. Unlike all its neighbors. who
seem to be comp .ting for records in
| banknote printing, Czecnoslovakia is
| not, issuing new currency. When the
succession states We're formed after the
collapse of the Austro- Hungarian monT
archy The Czech leaders asked the Aus
! ,ro- Hungarian Bank join them in an
effort to avoid printing money. The
Austro-HunGarian bank declined, some
say for political reasons. AS a result.
| Czechoslovakia stamped its share of
! the former empire banknotes. During
|; the first few years CZechoslovakian cur
| rency deprecated in value until 120
crowns We're worth only one dollar. Re
{, vival of Czech industry and the busi-
nesslike policy Of the government
| brought the value Of the Czecho crown
up rapidly until today ii is worth about
thirty to the dollar. The Austro- Hun
garian Bank has consistently inflated its
| currency until today $4,000 Austrian
crowns are required to buy one dollar.
Germany. Poland. Hungary, Austria
and Jugoslavia-the last modera teiy-
have adopted the policy of currency in
6..t 81
semblance of prosperity. Czechoslcvakia
/ decided to adopt the more courageous
! and healthy course Of detiation.
| Security Back of Notes.
! The government has collected about
1.500. 100000 crowns worth of gold and
! foreign securities. (The value of 4
note circulation is about 10000. 900. 900
| crowns. This places Czechoslovakia
| financially far ahead Of all the other
| central European countries. further
| betterment OF the crown is predicted
providing prices and wages can be low
| cred in order to renew industrial ac-
| tivity.
The Czech factories were hard hit by
| the appreciation in the value Of the
crown. Imitation in Austria and Ger
many hurt them in two ways. first, by
| making IT almost impossible for Austria
| and Germany to buy from CZecho-
| slovakia, and second. by flooding Cecho-
slovakia with articles manufactured by
clean labor
Czechoslovakia has more than 50 per
cent of the industries Of the former
iAustro- Hungarian monarchy. and
normally Austria is CZechoslovakia' s
best customer. Even now 1t takes 81
per cent OF CZechoslovakia's exports.
mostly for re-eXport. But the entire
Czechoslovak frontier is alive with
| smusglers who bring in cheap Ger
man and Austrian wares. 1t would re-
the mountains and forests. Czechs 20
quire the entire Czech reserves 10
close the frontiers against the SNUG
glers. who know the routes through
the mountains and forests. CZechs go
TO the adjacent German cities with
out overcoats and wearing old shoes
they return with new coats and new
shoes. besides carrying several bags
filled with wearing apparel which has
been worn just enough to make ii
look used.
Cuts Prices, Lowers Wages.
Although the increased purchasing
power OF the Czech crown abroad has
brought serious competition to the
Czech industries. prices have not ye,
gone down. Prices are about the same
as they were when the crown stood
at 12o to the dollar. This Is why the
Il
have prices and wages readjusted. a
few factories and merchants have re-
lsponded.
A striking instance is that Of shoe
company. It has lowered its prices
tmore than half Al the same time II
lowered wages so per cent The com
pany was able to do this by adopting
q schem" VI providing food at COS;
for its wors.men. direct result has
been effected: the buyers strike was
Inc f-r,r
5esieged with buyers. Food prices
have also gone down. Grain is now
only 40 per cent as high as it was i
year ago.
1t is expected prices will drop with
a rush before winter. There have been
many failuTes-merchan having
large stock bought at the high price
level.
The government is lowering fares
on the railroads. post and telegraph
charges and is reducing government
! expenditures. For the budget Of the
coming year there will be deficit of
| about 50O.000.000 crowns. This will be
| made up through state economies.
Surplus employees. taken on by the So
cialists directly. after the revolution.
will be released. Mr.. Benes tells me
that he has reduced the cost of the
foreign Office by s0.OoOoo0 crowns.
| Army costs have been greatly re-
| duced. At one time the percentage Of
I " = 4.
Later it was reduced to II. and now
! it is about II. This will be further
| reduced as part Of the governments s
| economy program.
| Politics in Situation.
| Many Of the industrial leaders and
| merchants are German n-Bohemians.
! Hence there is a political side to the
deflation policy. The Germans would
| prefer a policy parallel with the Ger
man and Austrian imitation scheme.
Also many OF the Germans and Czechs
have speculated in German marks.
Others are using their good Czech ex-
| change for purchasing property in
Germany. understand factories have
been shut down in order to place pay
! roll funds in the hands Of these In
| vestors.
The government. I understand, ID
prepared to lower tho present high
tariff wall II necessary in order to
bring prices down. Already Ameri-
can beef has contributed 10 this
cause.
The Czech buyers are looking for
bargains. and arc holding out for lower
prices. but for the present there are
! few bargains offered by tho manu-
! facturers and merchants. Several
hundreds of thousa nds Of workmen
are unemployed, and industry Is going
| through a severe crisis.
RAILWAY EXECUTIVE DIES