Evening star., 1924-07-22
j. 5. BANKERS BALk
At LOAN # FRENCH
CAN Invade REICH
Investors Must Have Abso.
lutte Guarantee of Safety, Is
American Stand.
HUGHES GIVES SUPPORT
TO POSITION IN SPEECH
Belgian Compromise Proposal to Be
Considered-Poincare Bugaboo
in Background.
BY the Associated Press.


LoNDoN, July 22.-The guarantees
provided for safeguarding the Ger
man loan, with which Is is proposed
10 launch the Dawes reparation plan.
were the chief topic of discussion
among the delegates to the interallied
conference today
The discussions between the hnan-
cial delegates of the conference and
the British and American bankers
who are being relied upon to take I'D
the bulk of the proposed $500, ,ooo, 900
loan, which began Immediately with
of the findings of the COM
mittee on defaults and penalties, were
continued
Safeguards Main Issue.
The suf1iciency of the financial safe
guards which this report provides
was a question which overshadowed
every other issue in the discussions
amongst the delegates, financiers and
diplomatic experts. Every effort is be-
ing made in the discussion between
the conferees and the bankers to OBJ
tain the bankers approval of the
scheme
While the general feeling regarding
an ultimate agreement is still opti-
mlstic, it cannot be denied that the
situation is not quite so bright TODAY
in view of the differences which have
arisen since the committees report
was made public last night.
The vagueness of the article under
which France might insist upon her
right to separate action in the event
of Germany's default is a principal
stumbling block. In the background
there always appears the figure of
Raymond Poincare, former French
premier, as one of the most powerful
critics of the conference, and the
French have to keep this in mind in
connection with any concessions they
may grant regarding French rights
under the Versailles treaty.
L. s. Bankers Dissatisfied.
1t is understood that the American
bankers are most frank in their dis
satisfaction with the present security
for the loan. although outwardly they
are maintaining a non- -committal at
titude.
In the conversations between the
conferees and the bankers it is
learned that some consideration has
been given to a proposal accredited
to the Belgian delegation under which
the reparation commission would be
further Americanized by placing
under it not only the agent general
of reparations and the representa-
tives of the loan bondholders. but
also another American who would be
the representative of the bankers.
1t is understood that this proposal
is tentative and that the exact status
of these officials under ithe reparatioD
commission has not Been definitely
worked out.
rhe task before the conference of
dissipating the. doubts and anxieties
which the bankers feel about this Sc.
curity for the German loan is in'
creased by two considerations: In
conference circles it is stated there
can be no serious consideration Of
governmental guarantees OF the loan
nor is there any Likelihood thas
France will agree to forego hef
rights to separate action, which she
claims under the Versailles treaty.
Serious View Taken.
While the official delegations in
sisted upon maintaining note of op-
timism and while the bankers re-
manned silent, there were unmistak-
able evidences that the financiers
were dissatisfied with the recommen-
da,ions of the committee regarding
the question of Germany's default.
While official quarters were not in
clined to regard the bankers attitude
as raising a crisis, it was recognized
that this reassertion OF the bankers
nroner demand for security for the
nronosed loan must be met with
nroner guarantees, since 1t was gen.
orally recognized that successtul
Launching of the Dawes plan depend
sd in the first place upon Notation or
the loan.
The British attitude has always
heen that it is of no use to prepare
elaborate plans dependent upon the
Io.n until it is clear that the loan is
certain to be forthcoming.
Text of Sanctions.
THE text of the report of the COM
,,;ttee on defaults and sanctions con-
q v,,,s the digests of the provisions al
readv carried in these dispatches. 1t
10 provided that the reparation COM
mission, enlarged to include an Amer
lean member, shall be the sole judge
as to whether Germany has made a
default under the Dawes plan. This
report. which it is proposed to in
corporate into a protocol. further pro-
vides that in any contingency, includ-
ing both default and resultant sane
tfons, the holders of the proposed
German loan shall have a priority
claim on all of Germany's state as
sets. Provision Is made that the
American member Of the reparation
shall be appointed by that
commission within so days after adop-
tion of the protocol.
"In the event of the reparation COM
mission not being unanimous" says
the text. "the appointment shall be
(Continued on P1Rr ColE,nn ~