Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-09-23
BRITAIN BEARING
/ DEPRESSION BRUNT
Foreign investments of Eng
land Have 0utweiuhed
Return on income.
BY CLAUDE A. JAEGER,
Associated Press Financial Editor.

NEW YORK, September 23.-Eng-
land has been focal point of world
depression, for no other nation has
spread its wealth and commercial actiy-
tiles so widely over the globe
British foreign investments are esti-
mated in excess of $40. 600. 900 900.
while recently Sir Josiah Stamp esti-
mated England's net wealth at only
about 10000, 900, 900.
In contrast. the United States has
foreign investments of only about
5000, 000, 900. while her total wealth
has been variously estimated between
$500, 900, 900, 900 and s400 600, oO0, 900.
John Bulls little island has long had
an excess of imports over exports. and
the real basis of his present trouble
is that he has been living beyond his
means-his disbursements to the rest
of the world have exceeded his income
from the rest of the world
In his better days his income from
his huge foreign investments. as well
as his earnings from his business as
chief carrier Of ocean freight and his
worldwide insurance and banking
businesses. made up the difference be-
tween his large imports and smaller
exports.
England's investments in South
America are enormous, and the almost
complete commercial paralysis of the
republics TO the south has greatly
added to British burdens.
That England, with its limited nat
ural wealth, should have become in
the past century the dominant factor
in world finance and trade is indeed
a tribute to British reSourcefulness.
The World War, however seriously
disrupted the complex and far-fiung
economic structure built up by Britain.
The strenuous efforts to recrgani7e it
after the war have been widely APP
plauded, but 1t Is scarcely surprising
that at last England has had to capitu-
late to the economic disease from which
the entire world is suffering.
But even before the World War, there
were signs that British domination was
slipping. The industrial revolution. with
its enshrinement of the machine and
the factory, had its genesis in England,
and throughout the past century, British
manufactured goods dominated all mar
kets. But at the same time England
loaned her capital and her knowledge
to her colonies and to her neighbcrs.
and they began to build their own fac
tories, and produce their own goods,
erecting tariff barriers to protect their
cwn manufacturers at home. and
eventually reaching out into world mar
ketS to compete with British goods.
The more immediate effects of q
retaliation Of the British currency at
a lower level sh@uld help Britain to re-
gain her markets abroad. As the pound
sterling declines purchasing power of
British goods by foreign currencies Is en-
HANGED. 50 that tariff barriers will be
more easily surmounted.
The British controversy between capi-
tai and labor as to whether fixed charges
or wages should be reduced may be
solved by the lower valuation Of the
pound. for this automatically win re-
duce both fixed charges and wages. and
improve the position of the manufac-
tureF.
Nevertheless. England must contin-
Use to purchase large stores of raw
material and fo-dstuffs abroad, and her
purchasing power in terms of foreign
currencies will be reduced. The final
Dement'S of the lower valuation Of the
pound, therefore, are at this time DIM
cult to forecast.