New-York tribune., 1922-04-10
Price of French
Bonds Rises i'm
Free Trading
Treasury VIII Be Saved Big
Sums by Allowing Securi.
lies to Find Natural
Level in The Open Market
Confidence Is Restored
Municipals and Railroads
Advance Rapidly as Inter-
esl Rates Start Decline
Special cable TO The Tribune

(Copyright 1922, New York Tribune lnc)
PARIS, April 9.-The great event of
the moment in financial circles here is
the beginning made in liberating war
loans by the inception Of free trading
in the issue of 1915, totaling 15,0O0.-
100000 francs. The purpose of this
step is to favor those who trusted the
government during its most critical
period, and also to gauge public conf
dence as to whether the present is
proptious time for freeing The remain
ing issues of 1917. 1920 and 1921.
These remaining issues. totalng
S0,O00000o 900 francs Win shortly be.
come negotiable, because as the result
of free trading there was a rise of the
5 per cent loan from 76, to 1896. at
which price the yield is still close to
6l2 per cent, compared with 5 1 3 per
cent for the perpetual 3 per cent bonds
The improvement in the situation for
fixed incomes is the result Of a series
of financial measures started last fall
and made effective by the Poincare
ministry through Count de Lasteyrie.
The first step was to suppress the
900,000,000 franc fund for the purchase
of government bonds in the official
market, which had the effect of saving
the treasury large sums, and allowed
trading to find its natural level on the
curb. This was followed by reduc-
tion in interest rates on treasury bills
from to Az per cent, without causing
demand for reimbursement from the
holders of 68,o00,ooO,OoO francs out
standing. After the successful COM
pletion Of this delicate operation it has
now become feasible to open the mar
ket for government bonds as interest
rates drop progressively. Already the
municipals. led by the City of Paris,
and railroad securities have started to
rise rapidly, while an imminent reduc-
ton IN Bank of France advances will
accentuate this tendency
The exchange problem probably will
be adjusted by intensihcaton of arri-
port trade. With Alsace- Lorraine and
coal deliveries from Germany, Frances
coal production is estimated at about
twice her needs.
trade is about stationary at the rate
Of about $4,000 100000 francs annually.
January and February figures maintain
thus tendency, with imports about
30000,000 and exports about $780,
100000 francs. The pre-war ratio of
corresponding months was about ID to
9 against France. Figures Just re-
ccived show that interior trade is
about three and half times the ex-
dependence of other countries is not
surprising.
In Switzerland. on the other hand. |
where the normal pre-war external
trade was at least equal to the In
ternal. the present slump in com
merclal activity has resulted in great |
hardships for The mass of the people, |
who could not grow more than one
third of the food needed for consump-
ton, and large numbers have been |
forced to emigratc.
There has been practically r state
receivership for the hotel industry for |
the last two years, and the best real
estate in most instances virtually has
passed from the proprietors to the
banks, who would take possession wers
it not for the moratorium. The hotel
stocks have slumped heavily, that Of
the MontreuX Palace Hotel syndicate.
formerly one OF the most powerful or
carnations in the country having de-
clinod from 1000 to 81 francs. Swiss
government bonds. however, are intact,
as arc the bank stocks, and interest Is
easily assured.