The New York herald., 1922-10-26
Continued from First Page.

revival OF the export trade that suffered
so badly during the years following the
war.
Bnrncs Sees America Puzzled.
The international debt question was
discussed by Julius Barnes. president Of
the United States Chamber OF Com
merce. from the standpoint of the Amer
lean business man. who. he said, was
not satisfied that European nations had
done all possible toward rehabilitation
The reduction or remission of the debt.
he said, would depend in a large
measure unon public opinion in this
country and the amount of confidence
the European nations would be able to
regain.
Lewis L. Pierson. chairman OF the
board Of the Irving National Bank.
presided at .he banking session. People
of all walks of life, he said, should con-
tribute their views so that the Govern
ment could determine upon policy rep
resentative of the opinion of the nations
Sir George said in part:
1.-THE men responsible for national
and international policy after four years
OF opportunity have not only failed to
find solution for the economic and
financial problems which the war Gre
ated, but have rendered them, and are
still rendering them. more difficult to
solve
Prior 10 the war not only were all
the nations solvent, but year by year
they were increasing in wellbeing. There
were a great many national debts and
there was a large amount of interna-
tional debt, but rarely did nations ex-
perience difficulty In meeting either
their national or their international OBJ
legations. The densely peopled nations
OF Europe were able to sell sufficient
manufactured goods and to render SER
vice to the world in general to enable
them to supplement their own supplies
by large purchases OF food and raw
materials from other nations while the
countries with power to produce food
and raw materials beyond their own
needs were able to sell their surpluses
in exchange for the manufactured goods
and services they req Tired in return.
1.-THE Willingness OF the manufacturing
nations to supply capital to nations that
needed it not only created an ever IN
creasing supply OF food and raw ma
terials. but enabled the manufacturing
nations to expand their own productions
and to find ready market for them. II
capital was usually invested in countries
from which the lending countries desired
10 obtain supplies of food and raw ma
erials, so that the borrowing nations
had no difficulty in selling the products
which the foreign capital helped them TO
produce. Thus the borrowing nations
met with no obstacle to the payment by
them OF interest and dividends to the
lending nations; IN other words, they
had no difficulty in selling sufficient or
their products TO the creditor nations In
order to meet their interest payments.
''The amount OF international debt,
that is, capital invested by various ma
tons in other nations prior to the war
was about sS,000.0 100000. carrying a
combined interest and dividend charge
of some S40O,000,000 a year. The re-
mittance of new capital from the lend
ing creditor nations year by year greatly
added to the volume and value of the
exports of these countries, while the re-
ceipt of interest and dividends greatly
added to the volume and value of their
imports. Had the lending nations re-
fused to purchase the products OF the
borrowing nations they could not have
received their interest and dividends,
and had they refused to grant loans to
them they could not have sold their
products, except to a very inadequate
extent Nations can pay each other only
as they can find markets for their goods,
for their services or for their securities.
For the purposes of international
trade. gold is just a commodity which
one nation buys from another when IL
does not Immediately want any other
commodity or service. The supply OF
gold is, however, very limited, and while
OF, great importance in causing nations
which possess large stocks of 1t to
spend more freely. or in causing the ma
tions That have insufficient stocks TO
spend less freely, its use for the purpose
of paying for produce or for the pay
ment Of interest and services between
nations is very limited. Before the war
Great Britain. with her great foreign
trade, rarely held a liquid gold reserve
OF more than ten million pounds. and
when she had to pay In gold she simply
bought the gold elsewhere.
Gold Used TO balance.
"For the purpose of international
trade. gold is used mainly TO balance.
and no gteat sums can be paid in gold.
Prior TO the war the nations were able
TO sell to each other enough produce
and goods not only TO pay for other
produce and other goods they needed to
buy. but to pay for interest and SER
vices. Also, the lending nations were
able to sell enough goods abroad TO en-
able them to buy all they required to
buy from other nations and also TO in
vest abroad large sums OF capital year
by year.
"It is necessary 20 realize clearly that
the investment OF new capital by the
manufacturing nations In the agricu-
tural and other nations expanded their
exports and the receipt of the interest
on this capital expanded their imports
Prior TO the war Great Britain had
loaned to other nations n sum OF about
four thousand million pounds $50 ,O00,-
e00, ,000 This capital was placed in the
United States in Canada. in South
America, in Australia. in South Africa
IN India and elsewhere. The interest
upon this sum gave Great Britain power
10 buy about two hundred million
pounds (si 600 Ooo .O00) worth of produce
annually from those borrowing nations
british Buying Exceeded Sales.
Before the war Great Britain bought
from the United States on an average
OF about f130. 0.00O.0 600 worth OF produce.
while America bought back only f30.-
10000 OF British foods. America bought
an extra go, 100000 OF colonial and
foreign produce from Great Britain,
such Bs tea. wool &c. Hence Britains
purchases from America exceeded her
sa,es to America by no less than 80. 900,
coo sterling. With this balance IN
Americas favor II will be realized that
the latter had no difficulty In meeting the
sIm Of about $50 900. 900 year which
she owed to Great Britain for interest