Evening star. [volume] (Washington, D.C.) 1854-1972, 1924-12-28
WAR TO PRESERVE
FRANC LAUNCHED
Energies of Government,
Backed by Morgan Loan,
Put Into Fight.
BY WILLIAM BIRD.

BY Radio to The Star. 20
PARIS, December 27.-France's
governmental energies, backed by
the s1O0,000,000 recently lent the
country by America, through j. p.
Morgan, now are being devoted to
stemming wave of financial de-
featism. This whispering campaign"
has been going on for many weeks
past, and wherever one moves In
rumors of the approaching collapse
of the franc and a resultant imitation
of the currency.
The sudden and unexpected resig-
nation OF President Robineau of the
Bank of France, who has struggled
without interruption since the war
to prevent such an imitation, is de-
clared to have been provoked by the
present cabinets program along In
flation lines.
Business mt Standstill.
The principal result of this "whis
pering campaign" thus far has been
to bring business to practical
standstill. This is reflected in re-
ports of the Christmas trade, which
show that French wholesale and re-
tail merchants reaped the most
meager harvest since 1914. Indeed,
as far as Paris shops are concerned,
they apparently did less business
than usual during the holiday sea-
son. instead Of being marked by the
usual rush.
So Tar, governmental measures to
curb the defeatist propaganda have
failed to touch the source of trouble.
The principal steps have been taken
against the Communists and op-
orators of the foreign stock ex-
changes, whereas most authorities
declare the bearist tendencies are
particularly noticeable among certain
French groups who desire the rapid
fall OF the franc for the purpose Of
stimulating exports and trade, as
well as Of helping to rid the treasury
of the burden of internal bonds, the
interest on which today represents
practically half of Frances national
budget.
Crisis Nearing Head.
1t is considered likely here that
the next three months will see this
crisis come to a head and will de-
eide whether France will continue
along the lines of consolidating her
liabilities or will launch into the
, perilous policy of imitation. There Is
no avowed inflationist party here,
but certain manufacturing interests
which are welding a powerful in
fuence are understood to be behind
this tendency.
What is particularly disquieting is
the recent sharp rise In prices, which
almost always in. the past has been
followed by fall in the franc All
the necessities have advanced con-
stantly during the last three months
and the suspicion is widely held that
this is due In great part to the big
interests, which are eager to force
imitation. II is declared by good au-
thorities that the index figures, when
they are published at the end of the
year, will astonish the public by the
unusually rapid advance in the cost
| OF living.
Undoubtedly. also, the repeated in
sistence of Americas intention of
| forcing France into a settlement of
her debt has much to do with the
depression Ambassador Jusserand's
negotiations with Secretary Mellon
are blamed largely for beginning this
discussion. Undoubtedly, Ambassa.
| dor Jusserand acted on instructions
from Paris. but, inasmuch as he Is
about to retire anyhow, there is a
diplomatic tendency to make him the
goat in the affair and to disavov
his act by some sort of a semi-of.
fetal reprimand.
Consolidation Urged.
The advocates Of sound money In
France are urging an immediate con.
solidation of the franc at some rea.
sonable figure and the permanen,
| abandonment of the pre-war eY.
| change value as an unattainablt
| ideal 1t is held that what France
needs is currency of fixed value
so That contracts can be made and
prices quoted on a permanent basis
! The present uncertainty about to.
morroW's rate of exchange makes /,
impossible to take a long view In
business transactions, and there Is
| the constant danger that the de.
1eatest movement on the stock ex.
change VIII upset the market and
throw the country into a panic like
the one of a year ago, when ]. p
Morgan's timely Intervention saved
the franc from ruin.
| (Copyriuht IQoxN