Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-09-07
BY CHARLES F. sPEARE.
Special Dispatch to The star.

Special Dispatch to The star.
PARIS, September 6.-The economic
situation of France today is similar to
that of the United States, but in minia-
ture. Business is poor, most so where
q state of normally is produced by
good wages, an active demand for pro-
fessional services and rise In the level
of unearned increment. The luxury
trades are fiat. There is merely mem
ory> of a market for high-priced cars;
none for used ones.
American tourists who spend lavishly
have been missed this season, though
the number of those who carefully count
their francs has multiplied. Together,
the two classes will contribute $780,
600 900 to the French trade balance, a
reduction of 20 per cent from the same
figure for 1929. When these payments
have been completed there will be a
temporary check to the imports of gold,
which have helped to raise the metal
holdings of the Bank of France $780,
100000 in the past IL months.
War Talk Heard.
The French business man and banker
are in much the same state of mind as
their American colleagues. They have
lost their nerve. Their domestic situa-
ton does not alarm them. There Is
little unemployment, relatively. Per-
haps there is more part-time work than
has been the case for some years. The
people may be economizing, but they
are piling up their accounts in the saw
ings banks. and also boarding govern
ment notes.
One hears talk of war between France
and Italy, while the coming elections
in Germany are casting shadows over
the political life of the country.
The present unfavorable psychology
of the Frenchman, however, is OF an
economic and not political cast. No
Improvement will take place until he
sees definite indications of an industrial
recovery in the United States and posi-
tive signs Of sterilization in the mar
kets for securities and commodities.
Like the rest of his European cousins,
he has been waiting for a lead from
America before he can shake OF the
depression.
His securities markets have not gone
down so much on the average as have
those of New York. Unlike the latter,
they are lower now than they were last
November. The Frenchman is inter-
ested in Americans" He cannot I'M
derstand why, with trade in the United
States so much worse than in the Au-
tumn of 1929 and with profits and divi-
dends shrinking steadily, the prices OF
stocks should stand higher than they
did at the end of the debacle. He also
argues that after five years of con-
slant upward movement, American
shares have not had sufficient adjust
ment to the new state of business af-
fairs. So he looks for another bad
quarter hour" before the day of re-
vival dawns.
France Took Loss.
He cannot help being satisfied, how
ever, with the financial strength of his
country. France took her loss while
other nations dallied with theirs. That
is why France Is so eminent today
in contrast with Great Britain and
Germany. A quarter of a century ago
when, as now, France had abundant
funds available for export, she threat
ened to wrest from England her flnan-
cial security. The war prevented this.
Though less vigorous than in 1905,
France is now fast returning to her
position of that year. At the same time
England is losing ground. Today France
stands next to the United States as a
money power, but with the United
States second to France in the de-
gree of skill in administration that has
characterized the conduct of her finan-
cial affairs in the past year.
The technicians of the Bank OF
France occupy a superlative position in
their profession. They have plan;
they act in harmony; there is no politi-
cal direction of their policies. Con-
trary to opinions expressed in New
York and London. they are not draw
ing gold from either market because
they want it. or have need of 1t, but
because by the law of exchange it au-
tomatically moves their way.
The phase of French financial we'll
being that is important for the Amer
lean market is the repatriation Of dol
lar securities as a sequel to the earlier
drawing back of capital in other forms
from other countries following the ex-
patriation period of flve years ago.
From investigations made here, 1t may