Show EXPLANATION GIVEN FOR WEAKNESS I IN STERLING One Cause Declared to Be BeLarge BeLarge BeLarge Large Extension of Credit The final report to the British Par Par- by Committee on Currency and andI Foreign Exchanges after the war points out that one of ot the main causes I for depreciated sterling sterling- is the large extension ex ex- 1 tension of or credit to Continental Europe for which there Is little hope of repayment repayment repay repay- ment in the near future It says sas in part Nominal convertibility of or the currency currency cur cur- rency note sustained by prohibition of ot export of gold is of little value Weakness Weakness Weakness Weak Weak- ness of exchanges is in a measure du duto due to trade conditions but an important cause of depreciation in New York and other financial centers is the e expanded state of in tIlls this countr country Existing Exist ing expansion is not merely the legacy fit of f war var finance and government borrowings bor bor- which even now have not ceased but also in part the result of maintaining rates for mone money in London below those in other Important financial financial finan man 2 cial cOal centers Difficulties of foreign exchange position are b by grant ot of term long-term loans and credits whether directly or under guarantee or otherwise otherwise other other- wise shy Jy Y government or b by private a sJ lenders r to enable foreign states t or their nationals to pay for tor exports from this countr country Few of these loans loans' and credits will be liquidated at early date I Large payments we have to make to America North and South for tor foodstuffs foodstuffs foodstuffs food food- stuffs and raw materials make St It it-es it essential es- es we in turn secure payment in cash caCh for tor as large a proportion as possible of our exports visible and ana In inVisible In- In visible We Ve recommend that preference preference preference prefer prefer- ence be given to countries able to tomake tomake make payment In lil ordinary course of I I tt ade Increased production cessation of I government nt borrowings and antI decreased expenditure both b by government and b by each Individual member of the nation nation na na- tion lre ire the first essentials ot These must be associated with restoration restora restora- I tion of war pre-war methods of or I th the currency and credit system of the country for the purpose of re establish III at an early date dale a free market markt for I. I gold in London I |