The New York herald., 1922-10-26


which she has incurred she has over five
thousand millions sterling OF foreign in
vestments in comparison with O net sum
OF somewhat over three thousand mil
lions sterling OF foreign investments
which America now possesses.
1T Is quite true that of her present
foreign investments some two thousand
millions sterling are doubtful, the money
having been lent to the war injured ma
tons of Europe. more particularly
France. Italy and Russia but even II
these Investments are entirely deducted
Great Britain still possesses some three
thousand millions sterling OF good for
eign investments, whereas of the three
thousand millions sterling Of fofeign Sc
curities which America now possesses at
least one thousand millions sterling are
doubtful in the same way as the British
investments are doubtful II allowance
be made for this the good foreign in
vestments of America are about two
thousand millions
Still other Factors Count.
Were this the complete story the diff
ficulties in the world situation would not
present such insuperable obstacles to re-
covery as the nations are now faced
with.
Great Britain has been a creditor ma.
ton for many generations and under
stands that 1t carries with il RESPONSE
biiities as well as privileges. and that If
her credits are to be good she must help
to promote the productive power and
the selling power of the nations to which
sne mas supplied so large a percentage of
her total capital.
Ihe British people are willing. as |
nave previously explained, to give a free
market in Great Britain to the produce
and goods of the debtor nations and
moreover are willing to buy that
produce with the utmost freedom. In
deed the growth of her population and
her increasing well being demands that
tne produce shall be purchased in order
that her people may be sustained. Con-
sequently the nations debtor to Great
Britain do not require to consider the
question of whether or not they can dis
pose or their products. All they have
10 consider Is whether they can produce
enough for sale at world prices which
VIII enable them to meet their obli9a-
tions.
On the other hand. the very fact that
ur TO the war America was a debtor ma
ton and was consequently more anxious
10 sell than TO buy has prevented this
American people from realizing that the
effected in their fortunes by converting
them from a debtor to a creditor nation
demands a change in their point of
view.
Clearly a creditor nation with a
large income from foreign investments
must be willing to buy more than II sell,,
II IT is to receive payment for the fn-
terest due to it. The produce may come
in as imports or it may be consumed
abroad by its tourists. but in some way
or other creditor nation must be
wiling to take payment of the produce
1t is still selling and OF the interest
which is due TO IL in the goods and ser
vices of other nations or it cannot be
paid.
"A nation may be quite solvent. in
deed quite willing and able to make
payment. but IL a creditor nation refuses
to accept payment either In goods or IN
services then 1t is difficult for payment
TO be made. A creditor nation NAV
Tor time accept securities in payment
Tor interest, but that merely means that
its foreign capital account Is accumulat-
Ing at compound rates and that ulti-
mately IL will be entitled to receive n
still greater quantity of foreign produce
and services in exchange for its own
produce and In payment for the interest
due to her.