Bisbee daily review., 1922-11-12

just to expect them to reduce the
 amount of the German separations
 payments if their debts to us are not
 to be reduced. As against this, it is
 contended with propriety and correct
 ness that, from the standpoint of legal
 obligation, there is no connection
 whatever between German reparationS
 and the Interallied debts, and it is
 further contended that there is no connection between the debts of our
 Allies among themselves and the debt
 of any one of them to us.
 When, however, one views the mat
 ter from the standpoint of the banker
 dealing with embarrassed debtors, a
 very different situation emerges. The
 banker may properly expect to take cognizance of every relevant factor affecting the future financial pros
 poets of hisdebtor. The Debt Funding Commission, viewing the matter as practical bankers, would therefore be interested in the separations problem for precisely the same reason that they would be interested in the rev enues and expenditures and internal debts of our debtors, their currency situation, their trade policies and trade relations, their military budgets, and other relevant matters"
 'Parenthetically it may be observed that the Interallied debt is one of the | least urgent of the many elements in the demoralization of Continental Eur Ope. With the exception of Great Bri- ! tain, none of our Allies is making ! payments to us, nor are we making ' on them for immediate pay ment. No exchange is being drawn in connection with these debts, except . the British debt None the less, the Interallied debt is very serious. i overhanging factor, which must be cleared up before conditions can real ly be made straight
 One ventures to express dissent from MT. Hoover's views with diff dence. His knowledge of European conditions is vast, and his practical wisdom is great. Few men indeed have contributed as much as he to a clear understanding of these problems. AS regards the immediate situation, however, it seems clear that MT. Hoover's figures present very un- duly optimistic picture. He lists a large number of invisible items in the balance shee which, he says, all combine to furnish large ! supply of our money to Europe with which they in turn can make payment for interest on debts Among these invisible items, MT. Hoover includes the growing volume of investments made by our people in foreign coun' tries
 "The published records of foreign loans made by American investors, during the fiscal year ending June 30, l922-the period of MT. Hoover's com- utations-indicate that nearly bil- ion dollars was loaned abroad. Al owing for refunding loans, the amount is still in excess of $50 million dollars. Of this, however, only about PA mil
 lions was loaned to Europe. The rest, an amount in excess of 600 million dollars, was scattered all over the world. Canada received much of it. South America received large part. The Far East received d good deal. |, When this correction is made, Eur ope's supposed 750 million dollar sur plus is immediately reduced to under l50 millions. II
 Moreover, when examination is made of direct trade relations between Europe and the United States, the II showing is less favorable to Europe.