Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1922-10-05
GREAT BRITAIN
WILL PAY DEBT
NJ 'KENNA STATES
Definite Postponement of
Payment of the Bills
Owed by Other European
Nations Is Advocated.

| IAOkIOIIO 10 FNbNSOGkSts
New York, Oct. i.-Definite
! postponement Of any payment of
| the debts owed the United States
| by European nations, with the eX-
ception of England until the actual
amount which such nations could
ultimately pay has been determined
| by conferences between the creditor
and the debtors was suggested by
the Right Honorable Reginald Nc
Kenua, former chancellor of the
British eXchequer, in an address
before the American Bankers as
sociation here today.
Mr.. McKenna also gave as his
opinion that Germany might be
able to pay as reparations in the
immediate future about one billion
dollars, derived from her foreign
balances and the sale of foreign
securities, such a payment only be-
ing possible if all other demands
are postponed for a definite period
to stabilize the mark. Future de-
mands at the expiration of that
period, he said, must be limited TO
the annual amount Of Germany's
exportable surplus at that time.
International Debts.
The speaker, who Is chairman
of the London's Joint City and Mid
land Bank, Ltd, said to be the
largest bank in Great Britain, gave
his views on the economic aspects
of reparations and international
debts, how they are payable, the
general capacity of debtor coun-
try to pay, and the effect Of pay
ment.
While he stated that he was not
in politics and did not appear In
anv representative character, as
British banker, he argued that
England has the capacity to pay
her debt to the United States and,
he continued, II can unhesitating-
Iy assertIher determination to honor
her bond in full"
The question to he investigated
in connection with the German re-
para tions, is not Germany's capac-
ity to produce wealth, but her ca
pacity to pay foreign debts.
Nobody has ever doubted GER
mans immense power to produce
he continued, but production by
itself is not enough. She must
find a market for her exports
We must remember that an IN
crease in her exports will only find
funds for reparations IL there Is no
corresponding increase in I'M
ports" .o,,tr
IN ohtain a surplus from the export
of goods, he argued. Mr.. NC
ttenpa also said he failed to see
how ADDITIONAL ta%atpn 'eai' ~
crease Gerlnany's foreign trade ano
provide a large eXportaoie surPius'
MANY Germans possess foreign
esets. he said. They have invest
ments or balances in foreign pahNs,
tbe nrocceds OF the sale or marks
which have been flung on torelgn
markets when the mark deprecl.
ated in value under pressure Oh
reparation payments.
"Relieye this pressure he SAID
land the mark would Immediately
improye. The mark has a far
greater value in Germany than IT
has outside and the German hold-
ers of foreign assets would nave
n clear advantage in selling thenl
to their own government.
"I believe it would be SAFE 10
nut the total value of these assets
at not less than a billion dollars.
More than that ] don't THINK
she has the ability to find, at any
rate for long time to come"
he said.
Touching upon the French debt
to the United States in which Great
Britain is also interested. as
French creditor, Mr.. McKenna
stated that Frances external debt
is far too great in excess of inter-
national trade possibilities. The
mere endeavor of France to extend
her foreign sales to the required
degree would disorganize the trade
of the world, he maintained.
Rational Reconsideration.
"Inevitable conclusion is" he
continued, that these internation-
al debts are far too great for the
capacity Of any of the debtor coun-
tries, except England. The whole
subject requires a rational recon-
sideration by the creditors who
must keep steadily in view the inn
mediate effect of the payment of
these debts on the general trade
oe the world"
Mr.. Mckenna stated as his con-
clusion that England has the ca
pacity to pay the United States In
terest and sinking fund on her
debt but that none of the other
creditors is in a position to meet
more than small part of the ex-
ternal liabilities. In the existing
situation in Europe a definite post
ponement Of any payment by them
Is desirable in the interests OF all
the parties, he said. The actual
amount which the other debtors
could ultimately pay should. as in
the case of Germany be ascertain
ed by inquiry into their exportabIe
surplus at full and frank confer
ence between creditors and debt
ors.