OCR Text |
Show INTERNATIONAL EXCHANGE PROBLEM Sir George Palah 8aya Quick 8olutlon Making Unnecessary Gold F Payment, laNear I Washington, Oct. 20. Quick solu- tlon of the International exchange I problem, making the payment of op-I op-I proximately $200,000,000 of American I gold to England unnecessary, was I predicted today by Sir George Palsh, I special adviser to the English chan-I chan-I ellor ot the exchequer now In Wash-I Wash-I Ington discussing foreign exchange I conditions with the board and Sec- ietary of the Treasurer McAdoo. He said today: I Sir George's View. I "At the present time England, ot H course, feels tliat she wants money I that Is owed her. The ordinary meth I od ot payment Is by gold, but in the H course of business the balance Is H usually taken care of by purchases H of American 'securities or by payment H (or your crops.. In View' of the pres I ent situation In your country the pay- H stent of this large amount of gold H at this time might prove inconvenient H and England was glad to respond to H a proposal that -the' case-be 'discussed H and an effort made to find some way H of meeting the difficulty. H "I feel sure, that some way will be discovered here by your federal re-H re-H serve board and the secretary of the B treasury, and there Is no doubt that H eventually the balance of trade will H again be In your favor. In the months HJ to come England will bo buying Am-H Am-H erlcan wheat and cotton. It probably H II1 not cancel the sum owed In a H few months, but It is bound to come Hj In time. In tho meantime arrange-Hj arrange-Hj stents may be made so that you will H not be embarrassed and yet England Hj -Bill be assured that her money will H be forthcoming when wanted." Hj London Stock Exchange Sir George, said that he believed H the London stock exchange would re- open In a short time, and thought it H probable that the New York exchange jWould be opened about the same JKInie. Ills government, he said, was H preparing to prevent tho calling ot H loans on securities that might ordln-H ordln-H arlly be expected to accompany the H resumption ot stock exchauge buul-H buul-H ness and with such a guaranty he H thought there was little to stand In Hj the way ot a reopening. He does not Hj expect to see the New York exchange HJ opened beforo that in London. HJ Sir George declared that ho did not HJ believe American cotton growers HJneed fear that English manufacturers -Hjvlll buy Egyptian cotton in prefer-HJence prefer-HJence to Amcricnn cotton. He added: Egyptian Cotton HJ "The Egyptian cotton Is not used HJlor the same grado ot manufactured f BlBlt . . goods. At present tho English mills probably have a sufllclent supply m hand for n few months. They aro naturally not anxious to buy, how-' ever, unless they are sure that cotton cot-ton has reached tho bottom prlcs. The margin of profit In cotton is too small to warrant such risks. If you succeed In taking caro of tho surplus crop I have no doubt that you will see the English mills in tho market again quickly. I suppose the cotton exchanges In Now York and New Orleans will open again shortly :f '.he plan "of the federal reserve board for a 1150,000,000 loan fund goes through. Then I think the Liverpool oxcha'igo will follow." Secretary McAdoo and the pcseive board were occupied today with tho directors and other officials of the 12 reserve banks who are In Washington i for a conference and there was no 'further meeting with Sir Georgo and Basil D. Wackett of tho Engllsti territory. ter-ritory. Mr.. McAdoo was ordered to bed tonight by his physician, suffering with a slight nttack of nervous ludl gestlon. He probably will not ie-turn ie-turn to his desk for severnl days nnd until then tho conference with tho English men, to which Now York bankers nro to bo asked will not be held'. Reserve Board Plans Although Sir George did not foel at liberty to discuss details of the plans under way for meeting tho situation, sit-uation, It became apparent today that the federal reserve board probably will attempt to provide short term interest in-terest bearing paper or notes vhkh will be acceptable to English government gov-ernment In place ot actual gold. It became known, too, that the English bankers recently refused to take the obligations of New York City ti the amount ot $80,000,000 bccaii3t! they were regarded as having too long to run. The English bankers aie said to prefer CO day or !10 day paper, pa-per, which is easily convertible and on which gold could be demanded in a comparatively short time it condi tlons arose to mako more gold necessary nec-essary to England. The federal reserve banks probably probab-ly will be In operation within HO days and then paper carrying their Indorsements Indorse-ments may be acceptable to English creditors. |