Evening star., 1932-06-26
ARGENT|NA'S DEBT
TO j. s. INVESTORS
NOW S321,@7,9)]
Dr.. WinkIer Continues Anal
ysis of Large Loans to
Southern Republics.
CREDIT WAS EXTENDED
DURING 9-YEAR PERIOD
Nations Budgetary Capacity Has
Been insufficient to Cover It's
Obligations.
BY DIR. MAX WINKLER.

Special Dispatch to The Star
NEW YORK, June 25.-That Amer
ican funds were poured into the coun-
tries south of the Rio Grande during the
past decade at a. pace much faster than
was warranted by the increase in the
productivity of the nations in question
no one will deny. The speed with
which bond issues were sold to the
American investing public is particu-
larly significant when comparison is
made with the financial transactions
between Great Britain and the various
Latin American republics.
The present study deals with Argen-
tine financing in the American and
continental European markets.
The total of Argentine government
loans which are outstanding in the
American market aggregates 1921, ,S07, :
300, the result Of nine years of borrow
ing, and covering the period 1923-I93l.
This Is at an average rate of $35, ,756, 500
per annum. Argentine loans outstand-
ing on the continent, as a result Of As
years Of borrowing Q887-l93I) amount
to 1921 ,346, 500. equivalent to an average
annual rate of s6,252,00O In other
words, the Argentine republic borrowed
in the United States within nine years
only more than the republic could bor-
row IN flve important European mar
kets within As years.
The case of Argentine provincial
loans ic even more striking. Less than
$110,000C00 remain outstanding as a
result of born owing over a period of
A years G887-1930) in European mar
kets, which is equivalent to an annual
average rate of not quite S2,50O, 900; /;
While Argentine provincial loans placed
in the United States are outstanding
at present to the amount of S98, ,103, 900,
the result of only six years of borrow
ing. This Is equivalent to an annual
rate Of about sic, 1856, 500, or six-and-
one-half times the rate at which loans
were granted by European bankers.
The amount Of Argentine municipal
loans outstanding in the United States
as result Of only seven years of bor-
rowing is in excess of the amount out
standing abroad, resulting from trans
actions covering the period 1889-1930,
or AZ years. The annual rate of bor-
rowing in the United States is mate
rally in excess Of six times the rate
at NAA4Ch AASC1ltAlC NAtACS hCAC dCNJI44-
modated in Europe.
The total of Argentine issues out
standing in the United States as a re-
suit Of only nine years of borrowing
amounts to $445, ,180, 500, or at an aver
age annual rate of almost $4,000, 900;
compared with S415. .304. 900 outStand-
ing in Europe as a result of As years
of financial transactions, and repre-
senting an average annual rate Of only
SO, ,229 .000
Small wonder that the Argentine
republic finds itself today in a position
where the debt is in excess of the
nations budgetary capacity. This IS
especially true of the provinces and
cities 1t is possible that some form of
adjustment involving scaling down Of
principal or interest, or even both. may
be necessary in the case Of provincial
and municipal obligations.
Copyright, 1892. by the North American
Newspaper Alliance, Inc)