Evening star., 1922-04-26
i. S. COOPERATION
IN EUROPE seen
Conditions Drawing Country
Into Taking Part in
Economic Affairs.
BY DAVID LAWRENCE.

Financial phases Of world resonstruc-
| tion are developing which may bring
| the United States into active co-opera-
tion with the economic forces Of Europe.
Although the official invitation to the
Federal Reserve Board to participate in
| a conference of banking institutions to
! be called by the Bank of England has
not yet reached here, the fact of its
| coming is confirmed. The acceptance
| will naturally be discussed by Secretary
Of the Treasury Mellon with Secretary
| Of State Hughes to determine whether
| the foreign policy Of the government
here would permit American representa-
ton. Inasmuch as the conference
merely will discuss plans and VIII not
I be binding upon the representatives
without the consent of their home gov
ernments. little doubt is expressed that
the American Federal Reserve system
will send a representative. Very little
| is known of the Bank Of England's 8
plans for the conference and 1t may be
| that the objectives sought cannot be
given American support. For this rea-
son it is expected that an outline OF
what is sought to be accomplished Will
be submitted in advance SO that Presi-
dent Harding and Secretary Hughes
! may know the scope of the conference.
Plan to Finance Europe.
The Bank of England last year pro-
jected a plan for the financing OF CEN
trail Europe by means of loan 10
| Austria, it being considereG 1xisable
| to use Vienna's banking machinery as
| a means Of reaching the smaller coun-
i tries which have grown out OF tne
former Austro- Hungarian empire
The scheme failed because the reparas
I tn q
priority on indemnity payments to
central Europe. Austrian exchange
was disastrously affected by the in
cident.
So far as known the new plan Is to
stabilize exchange. 1t is not thought
| Europe can be brought back to their
| normal, value by any artificial meas
ures. but it is nevertheless conhdentiy
| believed that something can be done
| to stabilize and thus prevent marked
fluctuations, especially win iana1 .he Ger Ger,
| which will take care of the obliga-
tions Of Germany.
! Inasmuch as the governments them
selves will be parties to the making
of the big loan, they must consider
the effect on exchange and act ac,
| cordingly.. The Bank of England and
the banks of the other countries en-
gagged on the allied side in the war
acted together to prevent excnanse
fluctuations during the war and some,
thing of the same sort Is expected
now that an approach is being made
to the financing of the greatest re-
construction era in world history.
Step Toward Cooperation.
The announcement by ]. P. Morgan
that he has accepted the invitation of
the reparations commission to discuss
the chances of selling in America an
international loan to Germany is only
one of a number of coincfdent steps
which are gradually being taken win
a. view to financial cooperation by
| allies and former foes. Mr.. Morgan
communicated with the Department
Of State. where no objection was in
| terposed to his acceptance OF the in
| vitation extended him by the repara-
| tions commission.
! Later on, undoubtedly. the United
States government will have an Off
cial representative on the commission.
Mr. Morgan goes in an unohicial ca
pacity representing only his private
! interests. but his word and Judgment
| will count for a good deal in foreign
councils. If J. P. Morgan believes a
| German loan can be foated, provided
( 1t is guaranteed or indorsed by sew
eral Of the allied and associated pow
| ers, the formation of an American
banking group probably will be en-
the United States government Will
then have to be won. As matters
| stand now, the government here has
no legal right to object to the fiota-
tion of foreign loans. but the pri-
vate bankers have agreed to obtain
cence before committing themselves
to the sale of foreign government
bonds.
! copyright, 1927