Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-01-14
MORGAN AS EXPERT
WOULD WIN FAVOR
Reported Selection of Banker
as Reparations Adviser Is
Welcomed Here.

The need Of strong American repre-
sentation was given here today as the
authoritative reason for the reported Sc
lection of j. p. Morgan, head of the
financial house of j. p. Morgan & Co.,
together with Owen D. Young, chair
man of the board of the General Eiec-
trio Co., as American members OF the
committee of experts, representing the
allies and Germany, which will under
take final and definite settlement of
Germany's war reparations at meetings
to be begun early next month, probably
in Paris.
As unofficial representative of the
American interest in reparationS, Mr..
Morgan would have to convince the ex-
perts officially representing France. Bel
gium, Great Britain, Italy, Japan and
Germany, that they must defer their
favorite plan for flotation of large
block of German bonds in the Ameri-
can market for the benefit Of Germany's s
reparation creditors.
Unofiicially Approved Here.
Although Mr. Morgans official des-
| ignation as American expert Is expected
to come this week from the Office of the
Permanent Reparations Commission In
Paris, his name is said to have been
| submitted by the commission to the
allied governments with the unofficial
knowledge and approval of both PreSi-
dent Coolidge and President-elect
Hoover.
| 1t is considered here to be vital for
/ American interests that Mr.. Morgan
should serve, not only because of his
| knowledge of the financial resources OF
this country, upon which the allies plan
to draw, but also because his judgment
| is most likely to be accepted when he
| tells them how far thsy can go.
The plan drawn up by the last inter-
| national committee Of reparation ex-
pertS four years ago, under the chair
manship Of Charles G. Dawes set ur
1000 .000, 900 of German reparatior
bonds, and for the last two years the
beneficiary nations have discussed mar
keting them mostly in the United States
The amount of bonds to be marketed
in the United States has been yariously
| set in suggestions from abroad as high
Bankers Opposed to Plan.
However, it was explained authorita.
| lively that If selected Mr.. Morgan woulc
have to serve notice on the allies anc
Germany that American bankers con-
slider it neither practicable nor desira.
| BILE for some time to come" to attempt
| any such marketing operation, and fur
thermore, that Mr.. Hoover, as President
| must not be expected to reverse his
previous disapprovals of heavy foreign
loans except to finance production.
If appointed, as reported, MIR. Morgan
| is expected to urge the allied experts
to address themselves first to fixing
an annual amount which Germany !:
to pay instead of the present amoun
of $600000,000 plus a prosperity sup
plement, prescribed by the Dawes plan
The final and most important step
In the opinion of bankers close to Mr.
Morgan, is to decide how long German!
shall continue to pay this annuity. Thu
Dawes plan fixed no time limit, ans
under it the payments go on forever
According to authoritative banking
opinion consulted here, these two un
certainties-concerning a fixed repara
tion annuity for Germany and the dura
ton of her obligation to pay it-ar,
responsible for the weakness in tn
market for German obligations, botl
public and private, which began to b.
felt year ago.
Bankers for Delay Of Years.
Among the bankers, whose opinion o
a bond offering practically makes TIN
market for it, the Judgment was freel.
expressed that Germany'S payment o
reparationS in her own currency ant
the allied transfer operations in chang
ing German currency for their own
must proceed at least several year
longer in order to establish sufficien
confidence in the stability of the proc
: ess to permit the marketing of pc
cent German reparation bonds wirhou
too much discount
t 1t was pointed out that the last fou
years of the Dawes plan were called tn
transition period" when the plan wa
: devised, and that it must not be for
) gotten that payment of a reparation
/ total which still stands officially at tn
1921 figure of $4,000, 100000 is a prob
> lem which outruns the experience O
, the world in the payment of interna
: tional debts.
+ Many of the experts who are to as
semble in Paris next month were mem
, bers Of the original committee whicl
devised the Dawes plan four years age
3 and they made the observation thel
! that experience alone would show HOY
I much of the reparation collected i
l German currency could be transferre'
to the allied countries In any one yea
without wrecking the German cur
rency and making it impossible t.
transfer anything in the succeeding
years.
The most recent observations fror
experience were made in the report O
Is Parker Gilbert who has been 1;