GERMANY FROM THE INSIDE.

Auckland Star, Volume LV, Issue 169, 18 July 1924, Page 5

GERMANY FROM THE INSIDE.

THE BEST CLASSES BADLY OFF. HOLDERS OP SAVIXGS RUINED. Following are extracts from a letter received in Dunedin thia week from London, dated June s:— "I found things in Hamburg in a very [depressed state. There has been undoubtedly a great speculation in the selling of francs from Germany, and very large losses have been incurred. As far as I could gather, the German l metal trades in particular have been I very hard hit, and I believe important failures have taken place and settlements have been arranged. "The real position is that the banks I are exceedingly short of money, and I therefore accommodation is next to impossible. The rates of interest are appalling—frequently 5 per cent per month, and more, is paid for accommodation. The position has probably in the first place arisen from the fixing of the mark. The currency now in Germany is the Renten mark, which is fixed at one-quarter of the American dollar, and therefore worth something more than 1/, the present exchange being about 18 Renten marks to the £1. "When this new mark commenced to be circulated, and wages were paid with it, the working classes had something tangible with which to buy necessities. Although they received very low wages, they immediately began to purchase all kinds of articles that they had been precluded from. The result of that was that Germany imported an enormous quantity of stuff which they manufactured for internal use. Thia had the effect -of using up the sterling they held abroad and lessening their exports, and the balance of trade againet Germany the first two months of this year was. enormous. The rates of living went up to such an extent that Germany is now a considerably dearer place than England to live in, and probably the dearest place in Europe. "It is expected that this depression will last, at any rate, three months longer, and in the meantime there must be a cessation of German-buying of everything except the essentials for living. "People are deceived by the number of Germans who made money during the war spending it freely abroad, and also the comparatively gay appearance of plaeee like Hamburg, where there is a large floating population from ships. The best classes in Germany are very badly off indeed, and those who were living on their savings are entirely ruined."