THE FALLING MARK.

Pukekohe & Waiuku Times, Volume 6, Issue 268, 20 April 1917, Page 4 (Supplement)

THE FALLING MARK.

3lany tests may be applied to discover relatively Germany is gaining) or losing strength as compared with tho Allies. Judgment, more or less reliable, .-may be ba:*d on the activity of her .armies, on the success or non-success *oi her navy, on the morale of ber -individual soldiers. Or it is possible to take as a foundation the stories cf neutral tourists, to read between the lines of heavily censored newspapers, to lea.a from the tales of prisoners of war, and from letters discovered on the ■dead and wounded. None of these .tests are to be wholly depended upon. .But according to a writer who has ■made a study of the international mon■ey market, there is one other test the importance of which cannot be gain--said. It is the varying value of the mark in neutral countries. This, he tells its tale to those who can read in an accurate and convincing way. i'or the best part of two years the de•dining value of the* - mark in neutral •countries has been fairly continuous. At the end of January, German money .had declined 37 per cent, in Sweden, -32 per cent, in Norway and Denmark, 31 per cent, in Holland, 33 per cent, .in Switzerland, and 30 per cent, in the -United States. What does this mean? It does not mean that the gold ten mark or twenty mark pieces are wortn Any less than they were. They, like sovereigns, cannot materially depreciate because they are measured in terms of themselves—that is, in terms of gold. But what it means is that if Germany •wishes to purchase foodstuffs in, say, ■Switzerland, to the value of 100 marks, •whereas when the Exchanges were normal, as they were before the war ; she would have obtained 123.44 francs -worth, she can now obtain only 83.4-3 francs worth We do not know to what -extent prices have risen in Switzerland, but a recent statement received i'rom Norway was to the effect that prices in that country had advanced by 85 per cent, since the outbreak of war. .Suppose then Germany wished to purchase some salt fish in Norway, as .'he .could do, despite the British blockade, through using the Baltic, then, for every hundred marks' worth on the *asis of peace prices she would have to pay first 185 marks as prime cost, and then a further 61 marks through the fall in exchange, or 246 marks in all, for what prior to the war would Lave cost her but 100 marks. To such a pass has Germany been reduced that her Government has in some eases compelled her merchants to quote for export, not in terms of marks, but in terms of kroner, in the «ase of Norway, Sweden, and Denmark; in terms ,of francs in the case of Switzerland, -and of florins if it be desired to get goods over the border of Holland. In way it is hoped that Germany will iivoid the full effect of the fall in exchange. In the early days of the blockade the German Government conceived another scheme. It instructed ats exporters to refuse to sell certain necessary commodities: for instance, iron ore to Norway, unless they were paid for it, not in money, but in what -a'j the moment was of much more value to +he nation at war, that is. in bales ■ of cotton or in pounds of rubber. The .rationing of neutral countries by Great Britain put an Effective end to that sort >of thing. The British blockade would indeed have been a farce had these .neutral countries been allowed to go <on importing cotton, rubber, copper, and other contraband goods merely with the object of transferring them to Germany. Neutral countries have iound that it has not been altogether satisfactory trading with Germany, during war time, as that country has proved as unscrupulous towards them in the field of commerce as she has proved without conscience in the fields of battle. Take a Norwegian experience. Norway has no iron ore for her industries, and in times of peace depends -upon England and Germany for supplies. At present she can get none from England, but has been getting a little from Germany via Baltic ports. Not long ago Norwegian importers were astounded to find that German shippers were drawing upon them for 60 per -cent, above the contract price, and the •drafts had to be "met before the consignees could get the bills of lading, and consequently the goods. Of course, the innovation was quite illegal and altogether exorbitant; but wnere the iron ore was essential the additional impost had to be paid. Swindling such as this will do Germany untold harm after the war, and will correspondingly benefit the Allies in waging the atter-the-war conflict for trade supremacy. One of the results of the war has been that Germany's commercial integrity has suffered enormously. Ever since in til* day or two preceding the outbreak of hosilities, when German traders robbed Bradford shippers of millions sterling, to the present day, e.o unscrtipulousness is too unseemly for iier commercial men to practise. Her ■credit is fast fading away as sho becomes more and more unwilling to pay for her imports in gold, more incapable of paying for them in goods, and unable to pay for them with securities, j; her securities are no longer regarded as secure. The authorities in Germany are quite conscious of the awkwardness of their position. Tney havo endeavoured to relieve the situation by controlling the importation of goods fro::i neutral countries, a special Government department having been formed for that purpose. They have taekl'd the situation from another angle, as well as by establishing buying agencies in neutral countries through which all purcnnsos are to he exclusively made, thus eliminating competition in neutral markets. Where German goods were urgently neded, as wis the case with some drugs, the production of which lias been a German monopoly, the exporters have been enabled to get level !.) so:- e extent by enormously raising their pri<es. This, however, has only been possible in connection witn a limited number of lines. Where there has

j been open competition, Germans arej suffering the chagrin of feeing their; former prosperous oversea trade being captured by the United States and by Japan.