Evening star., 1932-07-17
PREPARATIONS DEAL
MAY BRING MONEY
BACK TO GERMANY
Two Billions Was Deposited
in Foreign Banks During
Economic Crisis.
FRENCH WAGING BATTLE
TO SCALE DOWN DEBTS
Paris Has Won United Front of Eu.
ropean Nations Against U. S.
Demands.
Special Dispatch to The Star.

NEW YORK, July l6.-Cables and
wireless dispatches to the Business Week
give the following survey of business
abroad for the week ending today:
Berl,n.-Germans, along with almost
all other Europeans. are convinced that
Germany has finished with reparations
no matter whether the new Lausanne
agreement is ratified or not OF course,
If it is ratified. Germanys financial po-
sltion among the nations is made easier.
Business had discounted this much of
the Lausanne agreement some time ago.
That is why stocks scarcely reacted to
the first optimistic announcements from
the Swiss conference city. That is also
why financial markets were weak i'm
mediately it was known that Wall Street
showed no interest in the decision.
Advantage to Germany
Principal gain to Germany in the de-
ciSion last week was the chance of
bringing home probably $4,000 O0O0O0
of German deposits. which refused to
come back to Berlin until the Reich was
freed from the threat Of economic COL
lapse. because Of the reparations drain.
Another hope was that the same spirit
OF cooperation which moved Europe to
agree on reparations might continue un-
til relief is outlined for all Central Eu-
rope If such a scheme comes quickly
enough, it may save Germany from
seeking a further moratorium on prl-
vate debts. This, in turn, would relieve
Dutch, British and American bankers
of lot OF worries.
Paris.-The outcome of the Lausanne
conference is considered a triumph for
the French anti-clean-slate policy on
reparations, despite the fact that ulti-
mate ratification of the present decision
means an annual loss in reparations OF
$50 900 600 to the French budget.
In return for this sacrifice, France
has won a solid European front in its
demand that the United States scale
down proportionately war debts which
Is European nations owe her. To the
French. who have already had their
debt scaled down more than the Brit
ish and who can least demand a DEBT
cut on the grounds of inability 10
pay" this winning of a united front
is important
Industry, on the other hand, showed
several faint signs of a pickup during
the week Textiles and iron and steel,
however, continued to report decreaS-
ing activity General price indlceS de-
clined in June compared with May The
wholesale index dropped from 42l to
4O8: retail from $50 TO 554.
London.-Surface satisfaction over
Lausanne. plus the successful progress
of the conversion scheme in the two
weeks since it was announced, have
strengthened business morale. There IS.
nevertheless, an undercurrent or dis
appointment that the Lausanne agree
ment is not the clear-cut. final settle
ment which was expected. There are
even some doubts that the United States
will go very far to cooperate in writ
inc down war debts.
The success of the conversion opera
ton is one of the weeks most cheering
factors. Not only the gilt-edge market.
but all other markets. especially indus
trials. have spurted and investment
business is extremely lively. The Chan
ceilor has made special appeal to pri-
va te enterprise not to MAKE new issues
Of capital before the 3-month period OF
war loan conversion is ended, but new
issues are in active preparation, ready
for the opportune moment after Sep
tember when streams of cheap new
money will be available for Industry.
Gold Standard.
Announcement by the Bank for
International Settlements of its decis-
ion favoring worldwide return to the
gold standard caused little surprise in
London despite the fact the project is
backed by Montagu Norman, governor
o. the Bank of England. Britain is
definitely not committed to follow out
the policy In the better informed cir
cles, 1t is anticipated that Britain will
not return to the geld standard before
next year. The most discussed figure
for parity now is something around
SO. 60.