The Waterbury Democrat., 1935-10-14


 IS agreed to meet again at 4 p. m. G0 a. m. EST) to begin at once to prepare economic sanctions, in- cluding the Interruption of exports from Italy and the stoppage of shipments to Italy of numerous key products.
 Committee members informed the United Press that the resolution was intended to apply to commercial as well as to other credits. Those na- tions approving it are expected to follow the example of the United States exporters, most of whom have decided, according to reports cur- rents here, to sell only for cash. It was understood that commer- cial credits, though not specifically mentioned, were covered by the phrase bankers or other credits" Penalties Combined
 Seven penalties were recofnmend- ed to the general staff by its fi- nancial subcommittee. These were revised and consolidated into a pre- amble and five specific points. They were reported on reliable author ity to be as follows:
 Preamble-prohjbitions adopted are to apply not only against Italian government and persons and corporations in third countries acting as intermediates for Italy.
 1-Prohibition of loans to the Italian government and subscrip- tions to loans floated by the Italian government.
 2. Prohibition of bank credits to the Italian government.
 3. Prohibition of loans to Italian public institutions, corporate bodies or persons, andn prohibition of sub- scriptions to loans floated by the classes of persons and companies named.
 4. Prohibition of the emission of shares to persons or corporate bodies on Italian soil or any con- tinuance of execution of existing credit contracts.
 List of Key Products
 Great Britain and France are working on a list of key products, essential to war making, of which they intend to deprive Italy.
 It was predicted that weakening of the securities market on the New York stock exchange and other important financial centers might follow the application of the fi- nancial penalties.
 It was anticipated that the pen- alties would bring removal of Italian issues from lists of shares quoted in the Paris and other tstock ex- changes in league staets. Conse- quently it was believed there would be an increased tendency to dispose of such holdings on exchanges such as New York and Berlin, which would presumably continue to deal without restriction in Italian se- curitieS.
 Experts believe also that the Italian government, which recently requisitioned foreign securities held by Italians will soon begin to un- load these in foreign markets. It is reported that the government al- ready is disposing, or soon will dis pose of more than 3,500, 100000 lire (283, ,850, GOOD in foreign securities hitherto owned by Italian citizens. It is assumed that a substantial part of these may be sold gradually on foreign exchanges.
 May Force MussOlini
 League men believe that ii everything goes according to plan they are eventually going to force Premier Benito Mussolini to aban- don his African campaign.
 Great Britain and France now are working together on a list o1 key products, essential for wagine war, of which they intend to de prive Italy. In addition it would be attempted to cut off Italy's ex' port trade so that 1t could not ob' tain foreign exchange with which tt buy any goods at all in usefu quantities.
 The financial sanctions or penal ties would not only block streams O loans and credits to Italy prope but would even halt the sale O Italian securities on stock exchange of league states and presumabl. would forbid foreign payments o insurance premiums to Italian com panieS.
 The belief prevails that couple' with the arms embargo-the frs penalty as the financial boycott i the second and the proposed trad boycott the third-the coming com merciaI measures designed to chec imports and exports, to effect req financial isolation of Italy, will b sufficiently complete to force Mus solini to his knees within a meas urable time.
 Naval Blocake Is Last
 Should these measures prove in adeuuate, 1t is expected that ul timately Great Britain would resor reluctantly to a naval blockade, un der full league authority, of the Re Sea. cutting off the Italian expedi tionary forces from the home Ian via the Suez canal.
 l The Straits of Gibraltar at tn other end of the Mediterranea might also be closed.
 "The general staff," the so-calle little" penalties committee, no' | coasists of 18 members as Mexic l has been added. The "big" penal ties committee is officially said t include 52 nations. Albania, Aus tria and Hungary are included .