New Britain herald., 1927-11-15

must be paid in practically the same way 1t was contracted-in terms of goods and services. But services does not necessarily mean goods.
 While this is essentially true" the Foreign Policy report continues. it does not necessarily follow that inc only way in which the United States can receive payment is by ac- cepting a heavy adverse balance of merchandise and precious metals. It is obvious that expenditures of American tourists abroad provide foreigners with American dollars just as foreign merchandise sent 10 the United States provides them with dollars, and that these expenditures constitute an import on thc'total balance of our international pay mcnts in the same sense as merchandise and gold.
 Tt is believed hy many that for oigrers were enabled 10 pay their obligations 10 the United States by llI' iplllIllH'NI l'l'Alll- bH ~ iii' [ IT tti'1 10 foreign countries of amounts sui ficient 10 make up the deficit on current transactions and 10 pay the amounts due in tho form Of interest and dividends. When the entire movement Of international securities is taken into account. however. the not amount Of increase in our in vestments abroad, as pointed out above, WIS only s19S,o0o, GOO.
 Tn 1926, therefore. foreigners were only required to meet s4S.- 0,oG0, or , per cent. of their pay monts to the United States. out of new foreign investments. In other words, 95 per cent was covered by dollars received from invisible items. Although the percentage offset by invisible items has varied consider ably during the past five years, in cent"
 Interest and dividends due the United States annually will continue 10 grow: but so, it Is believed will the invisible balance of trade. Money due the United States from abroad in 1926 was s195,0oo, ,0oo; but in 19S7-sS the amount will have grown to s415, 5,O0O,000.
 hi1o irtit i,, tr, visible international transa ctions visible international transactions will undoubtedly increase" says the re- port, it is still doubtful if this in- crease will be sufficiently large to meet the growing interest payments that foreigners are required 10 mako to the United States, and the question arises as to how these adjustments will affect our commodity balance of trade. While it is impossible tc answer this question with any de. gree Of finality, there are certain factors Of major importance whic1 must be taken into consid ration.
 A contraption of exports need no necessarily result but rather by al increase in imports of foreign com. ; modities imports Of such a charac
 ter as will not compete with Amer
 ican producers. such as tropica foodstuffs. raw materials, and sucl luxury goods as silks, laces, preciou
 stones, etc. Such changes are re
 garded as consistent with our recen
 tendencies in foreign trade and re D fleet the change from q prcdomi
 nanty agricultural to highly in dustrial nation.
 The report necessarily is technical ' but its thoroughness indicates tha
 the foreign debts need not neccs
 sarily upset our exports nor foreiG
 trade. We are purchasing more i'm ports yearly, and of type that W | cannot produce ourselves and wit
 which we cannot do without. Thes
 and the invisible balance of trad ' will furnish foreign nations with tl1 sinews of finance to repay the SC 00,000,0o0 (present value) of WE debts and the s13,0O0. 100000 e, elusive Of war debts they owe us ; ~ the present time.
 IS