Evening star., 1924-09-05
GILBERT FACING
HERCULEAN TASK
Transfer of Billions of Gold
Marks Viewed Pessimis-
ticaIIy by Bankers.
BY FREDERIC WILLIAM VILE.

BY FREDERIC WILLIAM VILE.
| Seymour Parket Gilbert, jr, the
| young American permanent agent
| general Of reparation payments. j.
faced by a problem supreme above. all
| the other tasks that await him. That
! problem is how to transfer out OF
| Germany into the hands of the allied
governments the billions of gold
marks Germany has to pay under tho
| Dawes plan This writer is informed
! in an exceptionally high quarter that
| international bankers already scri-
ously question the practical posi-
olllty OF such transfers without up
setting the exchange markets Of all
Europe. The more pessimistic au-
| thorltles believe that this danger will
soon become so acute that radical
| remedial measures may be required,
| unless the basic arrangements fixed
| by the Dawes plan are to go by the
| board. If Mr.. Gilbert. who is tbs
youngest nnancier ever called upon u
grapple with a problem 50 colossal
| since Alexander Hamilton put the
| finances Of the budding American re
i public on their feet, can get the al
! lies money out Of Berlin WithoLr
| wrecking the European exchange sit
| uation, he will, experts declare, be
| miracle worker.
| Pessimfsm Is Voiced.
! In the same quarters in which these
ominous things are being discussed,
| the prediction is Ventured that inter
allied debts, as well as the $4,000,
100000 due the United States
Treasury from allied Europe, will
| never be collectible for the same rea-
son. That is to say, if the countries
that owe Uncle Sam were ever able
| to pay off any considerable parts OF
the debt, the operation would play
havoc with international exchange to
| an extent that would be devastating,
not only for the debtors, but for the
creditor United States as we'll
1t has already been suggested by
American experts conspicuously con
nected with the Dawes report that il
the German reparation scheme works
out, it might one day become tn"
model for another Dawes plan" for
payment of Europe's debt TO America.
| The basic idea, now to undergo trial
at Berlin, is that the allied countries
instead of sending gold to America
in payment of their obligations would
pay it into liquidation banks estab-
lished for the purpose at their own
capitals. on the lines of the Bank of
Issue" in which reparation payments
are held on deposit in Berlin.
In Europe it has been recognized,
don conference, that the transfer Of
reparation payments is the crux Of
the whole vast experiment upon
which Germany and the allies have
now entered. To surmount that prob
lem is Mr.. GilbeTt's paramount re-
quirement. All reparation payments
by the Germans are to be deposited
in the Bank Of Issue" to his credit.
The use and withdrawal of the moneys
so deposited Will be controlled by
committee consisting of Mr.. Gilbert
and FIVE persons skilled in matters
, relating to foreign exchange and
finance, representing five of the allied
and associated powers. Gates w NC
Garrah, New York banker, will be
Mr. Gilberts American coadjutor on
the committee.
May Expropriate Funds.
1t would, Of course, lie in the in
terests of Germany to Illustrate the
payment of huge indemnities by pre-
venting transfers of reparation funds.
The Dawes plan categorically conten-
plates such a possibility, as the result
of concerted financial maneuVerS.
either by the German government or
by any group in Germany. If such
maneuvers take place, the transfer
committee is entitled to employ the
sums to its credit in the purchase of
any hlHO Ol Ii Nci liioilS'
This in effect empowers Mr.. Gilbert
a nd his associates to appropriate Ger
man property.
The transfer committee will regu-
late the execution of reparation pay
ments, both in cash and in kind, in
such a manner as to make foreign ex-
change difficulties as slight as pos
sible But that these difficulties soon
er or later will arise either through
natural causes or by malevolent de-
sign in Germany is being quietly fore
shadowed by certain American bank
ing interests. If Mr.. Gilbert can steer
clear of the exchange rocks in the
business of transferring German pay
ments. he will have accomplished tho
overwhe elmingly biggest job assigned
him.
A writer of high repute in the New
Statesman of London says The
central point of the Dawes plan, tho
provision of capital Importance which
stands out stark and staring, is that
the onuS for the tranSference of
German payments no longer lies upon
Germany, but on the allies. In the
event of failure, it would be the al
leis who, in all probability. will be
in fragrant default, not Germany. 1t
is stipulated that if there is danger
of International currency fluctuations
by an attempt at transferrence, Ger
many shall not be obliged to continue
useless payments. The French, at
least are not convinced that break
down. either by German deliberate
maneuverS, or by the working Of
economic laws, can be avoided
Copyright, 19.4J