WAR FINANCE
BRITISH & GERMAN METHODS DEPRECIATED FOREIGN SECURITIES I • The Minister of Finance) Sir Joseph Ward, referred yesterday to the heavy depreciations reported in foreign securities as the result of tie war. "The pressure of the war," he remarked, "is having a much more severe effect, upon German stocks than those of cither Britain' or the overseas Dominions, or any of the Allied oountriefe. In the information of the London Stock Exchange at tlie end of December, it i? shown that the Austrian 4J per cent, stocks that stood at £01 before the war had gono down to £58, the Prussian 3i's ■ liad fallen to £50, tlie Prussian 3's to £48, and the German 3's to £49. A comparison shows in a very marked way the strength of the British finances. The closing quotation for British consols, which carry only 2£ per cent, interest, was at the same date £58}. This is the more remarkable because the market was not protected by what' is known as the 'minimum.'' "A comparison of tk6 exchange between Germany and New York shows the weakening tendency of German finance. In normal times the exchange rate was 95J-dollars for 400 marks. At tho end of. December it.was 77} 'dollars. It shows a drop in value of nearly 19 per cent. It is.quite apparent that in a vital .portiou of the Germaii fabric' the effects of the blockade and of the prolonged war are very apparent." "Another faot shows that the day., of reckoning'will be a bitter oho, so far as Germany is concerned. Britain is providing for tho whole financial situation during the war by taxation, while Germany is standing off, and for tho authorised loans she has had up till now is relying upon the issue of paper to her own people, which at the rate at which it is going up must in the long run spell bankruptcy for the country. It is quite evident frfim various sources that the reliance placed by Germany upon receiving a huge indemnity from the opposing belligerent Powers has been tho principal ground on which she has based her appeal to her people to support the war. The strugglo will be a Titanio one, but so far as human foresight can judge, - there is little chance of Germany receiving financial .relief from indemnities. On the contrary, tho baois of settlement ?n the ordinary course of events must domand large indemnities from Germany. With tho import and export trade, upon which Germany has relied in. the past for a large portion of her business, cut off in all directions and the indications disclosed by the depreciation of her own stocks, the carrying on of the war without success for another year looks like inevitable bankruptcy for Germany." '
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Dominion, Volume 9, Issue 2693, 12 February 1916, Page 3
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459WAR FINANCE Dominion, Volume 9, Issue 2693, 12 February 1916, Page 3
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