Imperial Valley press., 1924-10-24

BAibSDN l'Ah N, MdSS., ocl- 81
An analysis is being made at Bah
son Park of the subscriptions to the
new German loan; who they are
from. what sections of the country
are providing the money, and the
interest which is being shown by
investors everywhere. That the loan
has been huge success is, of course,
common knowledge but it has not
vet been fully realized what this
successful flotation means. In an
exclusive interview today Roger w.
Babson made the folloYing state
ment:
$50 many comments have been
made regarding the security and
Weld of the newl German bonds
that | need not discuss this phase
of the question. Personally, | am
hopeful regarding European bonds
only on the assumption that there
is TO be general disarmament in
Europe. Europe has money enough
either to make good it's indebted
ness or to maintain large armies.
Whether or not it has sufficient
funds to do both, only the future
can tell. ] sincerely trust that the
League of Nations will develop some
plan which will enable Europe to
safely disarm. Then there viii be
no question regarding European
bonds and the present German bonds
should sell at handsome premium.
The fact that Europe has not dis
armed is why Germany and these
other countries are obliged to pay
such a high rate of interest for their
money. Moreover, the banks who
have subscribed to these issues so
generously have probably done 50
in anticipation that some such dis
armament plan will be successfully
work out. Irrespective, however,
of the question of the future market
price of the securities two facts are
self-evident:
Two Facts Evident
"Q) The flotation of this loan
in America and Europe means that
arteries of trade, which have been
elogged the past ten years, are today
being opened. 1t is true that peace
was theoretically declared when the
treaty of Versailles was signed. The
signing of treaties, however, does
not mean peace. The world is rul-
ed by feelings rather by treaties.
Up until n few weeks ago there
was almost as much bitterness be-
Germany and France as there was
when the armistice was signed. In
general way this applies to all
countries, including the United
States. Up to last week it was
not good form even in the United
States and Canada to do much busi-
ness with Germany. The manufac-
J turer or merchant who did business
with Germany was looked upon by
| many people as 'scab' is looked
upon by members of labor union
To-day this is changed The fact
that the best bankers in the United
States, Canada, England, France,
, and other countries have subscribed
to this loan shows that 4 great
change in the situation has taken
! place. Certainly General Dawes and
his associates are entitled to n tre-
mendous amount of credit for their
constructive part in this important
development.
"(2). The opening up of these
arteries of finance and commerce
brings real benefit to many see
tions of this country. Probably the
first section to benefit will be the
south. Germany is bound to i'm
port more cotton during the next
.l2 months than she has during any
II months of the last ten. years.
south is having and the good prices
With the good cotton crop which the
which she is to receive, all the cot
ton states should distinctly benefit
by the successful flotation of this
German loan. The copper interests
should also benefit somewhat. Al
though the consumption of copper is
steadily increasing, with the tre-
mendous ore bodies now being de-
vcloped in South America and At
rica, the price has been kept down
to the dctriment of American mines.
Germany will now come into the
market for copper and European con
sumption in general should be slim
ulated thereby. This means in
creased prosperity for Utah, Ne
vada, Arizona, and possibly even
the lake districts. All sections de-
pending upon copper should be help
ed by this German loan. Although
the price of wheat has turned re-
Gently, the sag would have been far
more had this German loan been a
failure. With the great amount of
wheat being rushed to market and
the huge crop, it is surprising that
the price has not broken more. The
successful flotation of the German
loan should increase foreign demand
and increase exports and thus dis
tinctly help the grain situation. This
especially applies to Canada which
is destined to become the world s