Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-03-03
FINANCE SITUATION
CAUSING ANXIETY
France Expecting Cabinet
Crisis-JournaIist Describes
Possible Results.
BY GERVAILLE REACHE.

BY Cable to The Star.
PARIS, March 2-Financiers are
scrutinizing the worlds horizon not
without anxiety.
For seven consecutive years since the
universal slump of 1920-192l the world:
prosperity has steadily increased. es-
pecially In America. Europe's pros
perity has been specially marked since
1924 and can be attributed to the Dawes
plan and the sterilization OF the mark
the Ira and franc. England is the only
exception to the general rule-the re,
turn of the pound sterling to par still
weighs heavily on British industry.
Looking ct the Paris and New YORK
financial markets. one may we'll wonder
whether they have not reached their
peak. Certainly there Is no indication
Of q general economic crisis, though
dearer money might precipitate one
However, this danger seems past IoI
the moment. But the yield Of stocks
has been lowered greatly since the wal
Street and Bourse boOmS began, SO thai
industry Is in general capitalized at q
high figure. Future prosperity Is DIS
counted far ahead.
The bulls have not been wrong thus
far and If they should hold Oh until
time iustifies their optimism, they might
have nothing to regret; but the danger
of overspeculation remains. II Els ike
the old parlor game OF pass the candie
the first player runs no risk IN hght-
ing it, nor does the second VINO re-
ceives it half burnt, but the name seN
nearer and nearer as each succeeding
PLAYER takes his turn. and finally some
body gets his fingers burned. The OBJ
iect of the game Is not to be last.
Apprehension in America comes IRON
the tightness of call money, which
prevents the discount rate OF the bank!
of issue from functioning normally
That is the danger OF artificial contro
of the money markets. 1t is true ina
the persistent campaign talk IN l91s
about prosperity also had had Its eHect
In Europe the anxiety felt Is botf
political and financial. London Is wor'
ried about the coming parliamentar!
elections and the danger OF Labor
victory. Paris is daily expecting a cabi'
net crisis and the Berlin cabinet Is none
too solidly ensconced either.
Considering everything. one wonder!
whether the Young committee now
discussing PREPARATIONS settlement vii
accomplish its purpose. Failure to d.
SO would have far-reaching effects
Success, on the other hand, can only
be relative because 1t Is Impossible u
satisfy both debtor and creditors. Tht
delegates will part with some bitterness
after forced compromise, which wi!
give each goversment chance to pre-.
sent it to the people in quite different
manner from the others.
After this, an attempt will be mad,
to make the French Parliament swallow
two bitter pills-evacuation of tn.
Rhineland and ratification of the deb
agreements.
If everything goes as smoothly a!
that--if speculation Gains down in New
York and Paris during this delicat,
transition period of the Spring of 1872!
and the Young committee achieve.
moderate Success-then perhaps tn,
British Conservatives as we'll as tn.
present majority in France will manag,
to cling to power. In that case, thi
Summer might well see another for
ward push Of prosperity based on rea
results. But If not, Europe will pas
into the hands of labor and socialism
which once more, as in 1925, wouls
be given the task Of trying to untangl
a hopeless snarl.
(Copyright, 1927