Imperial Valley press., 1931-07-21
AMERICA
SUBMITS
PROGRAM
London Conference Given
COnd itiOns Under
Which u. S. Will Help.
AGREEMENT URGED
Committee of InternatiOn-
al Bankers Proposed To
Assist Germany.
BY JOSEPH II. BAIRD
UNITED Press Staff CorrespOndent)


WASHINGTON, July 81. U.H =
The American government through
its representatives at the London
conference today proposed an inter-
national agreement of bankers be
made to maintain short term cred
its amounting to 81 200 ,000,00O which
have been extended to Germany.
The proposal was made as a
means of safeguarding the German
economic structure.
The plan provides further that
European nations eliminate present
political friction for the economic
benefit of Europe. 1t suggests that
an international committee, prob
ably under the auspices of the
Bank Of International Settlement,
provide the machinery for interna-
tional cooperation to maintain short
term credits for Germany.
The American plan does not en-
visage any immediate long term
credit to the Reich. 1t provides
that immediate consideration be
given TO ultimate conversion of
some short term credits into long
term obligations.
The American plan was made
public here today by Acting Secre-
tary of State Castle. 1t was out
lined to the seven power economic
conference in London by Secretary
of State Stimson. President Hoover
communicated the plan to Stimson
and Secretary OF the Treasury Mel
Ion last Friday. The two cabinet
officers discussed the plan in broad
outline with the French and Ger
mans in Paris on Saturday before
going TO London.
The fun text OF the American
proposal follows:
The essence of the problem is the
restoration of confidence in Ger
many's enonomic life, both in Ger
many and abroad
Il. On the political side the
United States hopes that through
mutual good will and understand
ing. the European nations may
eliminate all friction so that the
world may rely upon the political
stability of Europe.
-. On the economic side, the pres
ent emergency is strictly a short
term credit crisis. Fundamental
pressure upon German economy
during the period of depression has
been relieved by the joint action of
the creditor powers in suspending
all payments upon governmental
debts during the period of one year.
But Germany has financed her eco
nomic activities to very great ex-
tent through the medium Of short
term foreign credits. There is no
reason to doubt the soundness of
the basis upon which these credits
rest. but the general uncertainty
which has prevailed for the last
few weeks resulted in such loss of
confidence that the German bank
ing and credit structure was sub
iected to very severe strain. This
strain took two very definite forms.
both Of which resulted in a drain
of banking resources and the de-
pletion Of government gold and for
eign exchange holdings.
I'm the first place there was
flight from the mark within Ger
many. In the second place there
was a withdrawal of foreign depos-
its and a curtailment on the part
of foreign banks OF outstanding
lines of credit.
Fundamentally there is nothing
to justify these movements and If,
through cooperative action, they
can be arrested. there is no reason
why the present emergency cannot
be Immediately and definitely sur
mounted"