Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-07-03
Special Dispatch to The star.

!
! NEW YORK, July 3.-The monthly
review of economic conditions issued by
the National City Bank usually sounds
the keynote of opinion in higher finan-
cial circles. The review for July Is Of
particular Importance because of its
analysis of President Hoover's proposal
for moratorium upon war debts
This article. written with great care
by a high ranking authority, treats
the subject with great seriousness. 1t
says that the proposal has met With
spontaneous and universal acclaim. A
| like situation never existed before and
from no other source could this pro-
| poSal have come with like effect, the
United States being the ultimate cred
itor of all the countries involved in the
network of obligations arising out of
the war.
! 1T is source of satisfaction" the
bank says, that this important pro-
posal on the part of the President is
thus far supported without political d.
vision in this country"
! 1t shows that the idea has been de-
veloping spontaneously. A practical
with a view to the present and future
rather than to the past.
The National City Bank points out
that there is an abundance of capital
available to finance a revival of bust
ness over the world, but there must be
confidence in the maintenance of peace
, and normal financial relations between
countries in order that capital may flow
freely from the centers where it tends
to accumulate in idleness to the places
and employment in which it is needed.
Ability to Pay Affected.
Germany'S ability to pay has been af-
| fected by world crisis such as nobody
| foresaw, when the reparations agree
ment was made. The economic and Do
litical situation throughout Central Eu-
rope is under great strain and the in
formation reaching President Hoover
through official channels gave warning
that the situation should be brought I'M
der the cooperative control of the ma
| tons most concerned in the mainte-
| nance of peace and order and the re-
vival of world prosperity.
1T cannot be reasonably said" the
bank continues, that the present pay
ments upon reparaticns and debts are
the sole cause of the world depression.
| but it must be generally recognized
that the settlements were made in a
| time of general prosperity, when pro-
duction and trade were expanding in all
countries, and the proposed payments,
although large, seemed likely to dimin-
! ish in Importance as the years passed
However, in the face of a world
crisis, difficulties have arisen. The out
! look Is changed, perhaps not permanent
| ly but ct present a great arrangement
of trade and price relationships has oc-
CURED, particularly affecting interna-
tional payments. President Hoover has
not assumed the situation to be per-
manent. He proposes an agreement for
the relief of present conditions.
| The proposition that debts and
reparaticns are a disturbing factcr in
the present world situation is one upon
which the United States will assume
the chief burden under the Presidents
proposal The CHI eff beneficiary of the
moratorium would be Germany. The
chief direct contributor would be the
United States, with France, chief bene-
ficiary of separations, second.
Would Avoid Controversy.
But the President has sought to
avoid reopening any of the original
controversies on account of the impor-
tance of prompt action The one great
problem in which all countries are now
most concerned is that of restoring
prosperity, and the way to prosperity
lies through normal business relations.
The world needs Gpite from uncer-
taint:eS md alsrms''
Probably the most significant state