EXHAUSTION OF U.S. LOAN

Press, Volume LXXXIII, Issue 25364, 11 December 1947, Page 7

EXHAUSTION OF U.S. LOAN

BRITAIN FACES “ GAP s ’ IN FEBRUARY COLUMNIST SEES DANGER TO RESERVES (Rec. 10 p.m.) NEW YORK, Dec. 9. The 400,000,000 dollars’ balance of the loan to Britain, which the United States has just freed, will be exhausted about the end of January, and as the Marshall Plan cannot be passed until the end of February or the middle of March, the British Treasury is endeavouring to bridge the gap In dollar supplies by other means. . This is reported by a New York ‘Herald-Tribune” columnist, Joseph Alsop, who is now in London. He adds that the expedients being explored are still cloaked in secrecy, and that most probably they involve the mortgaging of the few remaining dollar-value securities which Britain holds. Estimating that Britain’s basic reserve of hard assets is now only the equivalent of 2,000,000,000 dollars, Alsop says: “If her reserves fall much below that figure there will be acute danger of a run on the Bank of England, which holds the operating reserves for the entire sterling area. Britain would then be entirely depleted of hard assets and the entire sterling area would fall to pieces. Normal world trade would cease, and the economy of the whole non-Soviet world would collapse.” Alsop says: “Britain will turn the corner this winter if, in our own interests, we give them the needed help.”