GERMAN MONEY.

Taranaki Daily News, 28 August 1922, Page 5

GERMAN MONEY.

MARKS OF NO VALUE. CHAOS IN FINANCE. DROP CREATES PANIC. By Telegraph.—Press Assn.—Copyright. London, August 25. The German Exchange opened to-day at 10.000 marks to £l. Apparently Germany has abandoned any hope of an early settlement with France, which persists in demanding satisfactory guarantees. with the result that there are general fears that France will take drastic action. There are rumors, at present unconfirmed. that French troops have invaded the Ruhr. Meantime the proceedings of Sir John Bradbury’s delegation are still kept secret, although it is denied that an offer of £2,500,000 has been made.

Tn this state of affairs there has been large, apparently panicky, selling of marks, especially from New York and Amsterdam, where huge amounts of marks are held by speculators. These sales caused a panic on the Berlin Bourse, and. an even greater panic on the retail trad*'. countless householders besieging the shops anxious to use their last few marks for buying something of pract : cal value. Shopkeepers increase prices 100- per cent, daily. The trade union leaders have requested Dr. Wirth to reinforce the rationing of necessities, and that the Government should control foreign trade and prohibit the sale of sweets, champagne and luxuries, and limit the manufacture of beer.

Dr. Wirth rrt»l’ed that he would come to no agreement with Sir John Bradbury’s delegat : on which would endanger the people’s food supplies. He would increase the duties on tobaeco, coffee, and all luxuries, and prohibit imports as far as possible. Thp Government proposed an internal gold loan to raise the urgently-needed funds. London financial experts call attention to the fact that the Austrian kroner was 9000 to £1 nine months ago. and is now quoted at 400 000 *»nd point out that the mark is rapidly, approaching a condition in which >t will be equally useless as a medium of exchange and as a basis of taxation, so before long Germany will be unable to do any trade abroad. When it reaches that stage of depreciation, and supplies of food and raw material are exhausted, developments will be much more rapid and Infinitely more dangerous than in Austria, on account of the larger proportion of population engaged ; n industry in Germany and of the political complications.

WHAT IS THE EXPLANATION? EXAMINATION OF POSITION. MARKS OF NO USE. Received Aug. -7, 5.5 p.m. London, August 26. Samuel Motagu’s weekly review of the market says it is quite difficult to find a satisfactory explanation for the fall of 70 per cent, in the mark in one morning and 195 per cent, in one month Reparation ire not being paid, and payment under the clearing house scheme is not being effected. Apart from these obligations, which are not being fulfilled, Germany has no foreign debt for which interest and sinking fund charges must be provided in foreign currency. Germany requires her exports to be paid for in foreign currencies, and the mark balances standing to the credit of foreign importers have lost their value and utility as a medium of exchange.

Germany is pressing the sale of more marks, but foreign importers, who should be the legitimate buyers, find no use for marks, and consequently they have sunk to the levels of mere counters for speculators. As Germany will not take back her notes in exchange for goods, the commercial world has had enough of them, and marks are useless for the exchange of goods, except in the interior of Germany. They are discredited outside Germany, as they will not buy German goods. Germany has scored all the way. She has exported milliards upon milliards of paper money in exchange for huge amounts of raw materials and foreign currencies. The foreigner has paper, and at last he is tired of the game. — Aus.-N.Z. Cable Assn.

SPECULATION IN MARKS. EXPECTATION OF RECOVERY. GAMBLERS’ RUSH TO UNLOAD. Received Aug. 27, 5.5 p.m. London, August 26. Tn view of the fact that financial institutions have been receiving cabled instructions from overseas speculators to buy marks, the following from the newspaper Statist is of interest: “Till quite recently deluded speculators in this country and abroad have continued to be fascinated with' the idea of making fortunes on the supposed recovery of the mark. It is almost incredible that anybody should look for the recovery of "the mark to the pre-war level, but such undoubtedly was thought of by many speculators. We suppose the eyes" of this class of gambler have at last been opened, and having lost all confidence in even a temporary recovery, they rushed to get rid of their holdings at any cost.” —Aus.-N.Z. Cable Assn.

INFLUENCE ON INDUSTRY. GERMAN UNIONS ANXIOUS. Received Aug. 27, 5.5 p.m. Berlin, August 25. The German Federation of Trade Unions has telegraphed id the British Trade Union Congress stating that the collapse of the mark signifies the beginning of economic chao®, with incalculable consequences for Europe, certainly extending unemployment in Britain. The message adds: “Salvation is still possible if you intwyen# wynsdiataUr ”