FRENCH GOLD

Dominion, Volume 10, Issue 2929, 15 November 1916, Page 5

FRENCH GOLD

THE SOLID FINANCIAL POSITION IN JAMS M. RIBOT 7 SFACTS AND • FIGURES . ' ■ «nv° % ' Paris cor «spondent of the limes M. Ribot recently made a most optimistic statement regarding I'rencli finance. "We look forward to the future," ho said, "with buoyant hope and serene confidence, lie finan- ■ cial situation at home is in no way disquieting. This country has an immense capacity for work, and it will know how to restore the balance of exchange in our favour. Our burdens will, So doubt, bo heavy. We are determined to introduce an income tax in due course This would already be an accomplished fact had it- not been for the war. Thanks to tho elasticity of this formof taxation, whicrrfcas stoodEngland ui such good stead, we shall be able to meet a good part of our liabilities, but undue haste in taxation would only disturb and gcaro tie country. ■■- ' ''The confidence of Frenchmen k the future is absolute. The strongest proof or this is the loan wo raised last year, which furnished us with a capital of 600 millions sterling, and still stands three points above the issuing price." The point which is occupying the serious attention of France at the present moment (IT. Ribot went on) is Low to devise ways aud means to pay for purchases abroad, aud to ensure greater latitude on the American market in the matter of trade: "We are endea--vowing to enlarge the basis of our commercial credit, which is somewhat hamPu re ?r ■? U' o -methods in practice in the United States. In this matter we hope shortly te secure a definite improvement." . .

Assisting the British"Cold Reserve. ■ ''^ay'mention," he Proceeded; that a very satisfactory arrangement was arrived at during the last meeting ir Calals wMI Mr - Asquith ail 3 ' Mr. M'Kenna, on August 24. England is anxious to strengthen her gold reserve in order to maintain her gold standard and enlarge the scope of her credit in the United States.' Now the Bank of France has, even at this stage of the struggle, a gold reserve exceeding 160 millions sterling.; We were therefore in a position to promise Eng-' land a considerable sum out of our abundance. ■■ Russia has also promised a certain amount of gold, and Italy, likowise, in proportion to her capacity. Thus the Allies are, if I may say. so, pooling their gold in order to 'reader their collective financial position still moro solid. '"Wo are placing this gold "at the Disposal of the British Treasury as a' loaiij and. the Treasury will open a' credit in pounds sterling in our favour-, in London. The arrangement, as you? see, cuts both ways, and is altogether in tho common interest of the Allies., ■ The gold 'loaned' by us will return to' the coffers of the Bank of France after tho war." '■ The second French' AVar Loan will be issued early next month. As previously it will not be for any specified sum, but this time no portion of it- will be diverted by the conversion of the Threo per Cent. Rentes. Subscriptions will therefore bo in hard cash or Treasury, bills and short-term Exchequer bonds,' of which 1 only forty millions sterling are oustanding. This second War Loan wdl not be redeemable at- any given date—that is te say. M. Ribot pointed out, France will only have te provide for the interest on it.

In conclusion," he said, "the situation, is .satisfactory. The increase in our national debt since the beginning of the war is 38 milliards (1520 miP lions sterling), of which, roughly speaking, 13 milliards are consolidated, 13 milliards in short-term bonds payable only after the war, and 13 milliards in floating debt. A floating debt of 520 millions sterling is not a source of anxiety. A' good part will be paid back out of the loan, and tho remainder, doubtless, will be consolidated in due course, that is, after the war. The liopeful' turn taken by at the front improves our • situation by increasing confidence at homo and' abroad. It is a great trump in our hands financiallyAhat the world recognises our final, triumph to' be merely, a question of time."- . _, ...i