The New York herald., 1922-10-13
FORBIDDEN TO PAY
MARKS FOR DOLLARS
President Ebert Signs Decree
to End German Exchange
Speculation.
BARS FOREIGN PRICES
Penalties Are Confiscation,
Fines Of Million Marks or
Prison for Three Years.

Special Cable to THE New YorK HERALD.
Copyright, 1929, by THE NEW York ,HraALp.
New York Herald Bureau.
Berlin, Oct. 12
In n desperate effort to save the
mark from complete collapse and to
prevent Germans from converting their
marks into foreign money, fearing
financial control OF Germany by the
Allies, President Ebert to-day signed
decree forbidding exchange specula-
tons. The punishment for viola tions
is conflscation of the foreign money
obtained by exchange operations. fines
up to 100000 marks, or Imprisonment
for maximum of three years.
This decree affects operations such
as nearly every German has been
making for many months past. Do
mestic price fixing in foreign money
or on an exchange rate basis is pro
hibited. Only firms which can prove
their need for foreign material will be
allowed to purchase or use foreign
money, and then only after a new con-
troll board has investigated and ap-
proved the case. Banks also must
make careful investigation before buy
ing foreign currency from individuals
and must report all such transactions
to the Department of Finance even
though in the banks judgment such
purchases are justified. :
Doubt DEGREES Efficiency.
While it Is admitted that drastic steps
were needed to stop the enormous sale
OF marks for foreign currency. some of
which Is quite as dubious as the Ger
man money. some leading business men
have their doubts as to the effective
ness of the new decree.
One prominent banker. who has long
been opposed to Government interyen-
tion. admits that so per cent. of the re-
sponsibility for the recent drop in the
mark to 5000 TO the dollar must be
charged to unwholesome speculation.
Nevertheless, he believes that the
machinery with which the Govern
ment proposes to put n stop 10 the
speculation will clog business withou.
catching the real spcculators."
Herr Pinner. prominent economist.
told THE NEW YORK HERALD correspond
ent that such restrictions should have
been introduced two years ago. "They
are necessary to-day" he said, "but
these restrictions alone are inadeuiate
to avert a German financial crash The
only salvation Is through stabilization
OF the mark. This can partly be done
through using the 1000, 100000 gold
marks reserve as security for domestic
gold loan. Such measure would give
domestic business gold standard and
would make sound business possible
again.
business Man Needed.
Hans kraemer. vice-president OF the
Economic Parliament and leading
manufacturer. regards the Governments
measures as entirely inadequate in
strengthening out the financial confusion.
The socialist politicians who have the
authority" he said. "do not understand
industry and its needs and are proving
themselves helpless to meet the economic
situation. Rigorous restrictions on spec
ulators are essential but effective reme-
dies will only be devised when business
men and economists instead OF politi
clans determine Germanys economic
policy"
II has become the custom here even
among the smallest wage earners TO OK
change their earnings for foreign money
as soon az possible. Those fortunate
enough to have something 70 put aside
have been investing IL In foreign cur
rency instead of putting II In savings
banks as In tho past.
Although the Cabinet has been hold
ing long sessions 1t has been showing
marked lack OF capacity for dealing
with the crisis. Unless German states
man or fnancier can put forward a bold
and effective program in the near future
the possibility Of allied financial control
OF Germany Is foreseen. ~