DEBT PAYMENTS

Hokitika Guardian, 24 June 1931, Page 6

DEBT PAYMENTS

SUSPENSION PLAN. I United Press Association—By Electric Telegraph—Copyright. ] LONDON, June 22. •Influenced by Mr Hoover’s proposals, for the suspension of international debt payments for twelve months, the London Stock Exchange business was strong and active. Prices of all sections were marked up, including Australians. Big rises developed in many industrial and foreign bonds. The most notable rise wasj eight points in German 51 per cent. The Berlin Bourse opened sensationally, showing a rise of 30 per cent, in some, shares over Saturday’s prices. Even the general public was buying.

NEW YORK, June 22

The stock marekt reacted violently upward after the statement by Mr Hoover on Monday. There were early gains of two to fifteen dollars per share, but later profit taking wiped out some gains and the market closed two to ten stronger. The commodity market was stronger, cotton scoring almost three dollars per bale advance.

NEW PROBLEMS ARISING. FRENCH AND BELGIAN LOSSES. LONDON, June 23. While there is not the slightest diminution in the appreciation of President Hoover’s offer as to debt payment suspension, awkward points have been raised (in three countries, namely, France, Belgium and Italy; while in addition, the position of the British Dominions is still regarded as not being clear.

France is concerned about the unconditional portion of the German payments.

Belgium is uneasy because her net balance from the German reparations, after her payment of her debt ’ to America, will amount to nearly three and a-half millions sterling, the loss of which would gravely affect the Belgian Budget. Italy’s approval of the offer is unqualified. Nevertheless, the feeling in Fascist circles is that Germany must give up her idea of union with Austria.

GERMAN DEMAND. TO CHANGE YOUNG PLAN. BERLIN, June 22. Dr. Bruening, tli% Chancellor of Germany’, in the first statement since President Hoover’s offer was published, declared that it afforded no relief to Germany’s taxpayers or to her unemployed people, as the reparations holiday proposed is from July 1931. to July 1932, whereas the German Budget was from April to April. Therefore, there would be only a three-quarters saving. The benefit to the current financial year would be absorbed by measures that would far surpass Germany’s ‘Y§b#nt & finhhcial decrees ■ and, in order to put Germany’s house in order, Germany intended using the breathing space to secure a lasting revision oi the Young Plan. He hoped, he said, that the world was now convinced that this problem should he pursued to a solution.

UNCONDITIONAL INDEMNITY. LONDON, June 23. The ‘‘Daily Telegraph” says: The .postponement of the unconditional German annuities due to Fiance would constitute a contravention of the Young Plan, as it was settled at the international conference. COUNTER PROPOSALS. LONDON, June 23. The French Ministers, M. Laval and M. FlaPdin, have been working all day long in working out counter proposals to those of President Hoover, which are being forwarded to Washington. APPROVAL IN PARLIAMENT. RUGBY, June 22. Mr Hoover’s /proposal that for one year, as from July 1, there shall be a postponement of all payments, all war debts and reparations, both principal and interest, was the subject of a brief statement in the Commons. Replying to a question put by Mr Baldwin, the Prime Minister said that His Majesty’s Government of the United Kingdom cordially welcomes the striking declaration of Mr Hoover. For their part, the Government desired at once to stkte thaf they would subscribe whole-heartedly to the principle of the proposal, and were prepared to co-operate'in the elaboration of the details with a view to giving it practical effect without delay. “The 'House will not expect me to say more at' the present stage,” added Mr MacDonald. I Mr Baldwin, on behalf of the Con- I servatives, associated himself with the j words of the Prime Minister. Mr Lloyd George expressed similar sentiments.

LONGER POSTPONEMENT. URGED IN LONDON. LONDON, June 23. The general view on the London Stock Exchange is) (that one yoar’sjT moratorium is not sufficient. Yet it is held to be a step in the right direction. An important factor in the United States Treasurer, Mr Mellon’s inquiries in London was that he asked whether Britain would continue her payments ( to America despite a German default, and was informed that Britain would Certainly stand by the Balfour Note, while at the same time the City of i

London informed Mr Mellon that the British taxpayer would not consent fco further burdens to meet such a contingency for which Britain would be in no wise responsible. LOGIC OF FACTS. CALCUTTA, June 23. Regarding President Hoover’s plan as to the thin end of the wedge for the general cancellation of war debts, the “Calcutta Statesman” expresses the opinion that “if this year’s moratorium does bring sensible relief, America will have to face what the world will call the logic of facts.”

DOMINION GAINS. WILL N.Z. BENEFIT A MILLION. LONDON, June 23. The “Morning Post’s” special representative says that taking it for granted that Britain will lose the full war debt payments from the Dominions, he reckons that Australia wilt have a net gain of approximately £3,109,000 after her loss of £830,000 in the German 'reparations. New Zealand, lie says, will gain £1,060,000 after her loss of £304,000 of German reparations.

A NEW ZEALAND COMMENT. CHRISTCHURCH, June 23That the Hoover proposal to postpone National debt payments would probably mean a million and a-haif. pounds a year to New Zealand if it is adopted is the view expressed by Professor A. H. Tocker, who said: “New Zealand’s interest in the matter is confined to the receipt of reparations payments, which are almost negligible, on the one hand and a funded war debt to Great Britain, on the other hand. This debt, in 1922, amounted to £27,500,000, ’ and New Zealand is paying in respect of it, £1,650,(X)0 a year. If the proposals are adopted and New Zealand’s war debt to Great Britain is included, the relief given to the Dominion would be represented by this amount and would be both substantial and welcome.”

The news that America proposed a postponement for a year of all Governmental payments on account of war debts and reparations was likely to be widely welcomed, he said. England had repeatedly stated her readiness to cancel all debts due to her if the debts due by her could be similarly cancelled. Hence there was little doubt regarding England’s willingness to accept the scheme. Excluding France and Belgium, most of the other European countries concerned were debtors and were also likely to welcome the scheme. France and Belgium were the chief recipients of reparations payments from Germany. France, however, was now in a financial position that she might be induced to make such arrangements regarding the reparations as would conform witli the American suggestions.

MR HENDERSON TO VISIT PARIS. RUGBY, June 22. 1 rThe 'Tier situation brought about by the American offer, will make the visit of Mr Henderson to Paris next month, of considerable importance. Mr Henderson proposes to be in Paris on July 15 or 16, and will take the opportunity of discussing first band with mqmbeis of the French Government the proposals and principles which will have been decided upon by July 1. Mr Henderson proposes to leave Paris oiv the night of July 16 for Berlin, where he will join Mr MacDonald in returning the recent visit of Chancellor Bruening and Dr.. Cur tills to England.

FRANCE DEFERRING REPLY. PARIS, June 23. Cabinet has deferred formulating a reply to Air Hoover, till to-morrow. PAPER’S POINTED QUERY. PARIS, June 23. “Le Journal” declares Mr Hoover’s proposal will involve France, Belgium, ; Italy, and Britain in Budget deficits leaving Germany the only country with a surplus, and strengthening her position to compete in the world markets. The newspaper asks—ls this what America wants? BELGIAN COM M ENT. BRUSSELS, June 23. The “Etaile Beige” declares Germany had shown considerable bad faith and even used blackmail. Americans are business people, striving to save capital imprudently invested in Germain'!' enterprises. Air Hoover’s plan will only postpone the reparation problem though it may point a way to a final solution based on world cooperation.

. MR HOOVER’S PROPOSAL A COUNTER TO' RUSSIA. (Received this day at 9.25 n.m) LONDON, June 23. The ‘Morning Post” Diplomatic cuirespondent undertsands carefully laid plans bv Moscow seeking to control Germany, wore a determining tacroi in Air Hoover's haste with his announcement. He had intended to postpone his declaration till Air Stimson arrived in Europe, hut" he learned that the safety of the Bruening Cabinet was a matter of hours. The fall of Germany’s Government would have resulted in a coup de otat by the'Extreme

right ,a-s foreseen by Moscow. This' would have led to- a financial catastrophe, with a swing to the left as a natural reaction. Russians hoped France would then re occupy Ruhr arousing the antipathy of the whole of Germany, and giving the Soviet an excuse for an attack on Poland in order to come to the assistance of the Communists in Germany. Mr Hoover’s proposal has destroyed the Russian hopes.