FRENCH FINANCE

Hawera Star, Volume XLVIII, 4 April 1925, Page 5

FRENCH FINANCE

MORE PAPER MONEY ISSUED

ADVERSE CRITICISM

LEADS TO POLITICAL CRISIS

BY CARLE—press association— copyright

PARIS, April 3. The Minister for Finance (M. Clementel) resigned early this morning on account of the unfavourable reception criven to his finance proppsals. ” The resignation of the Government followed, but it was announced later that the Premier (M. Herriot) had withdrawn his resignation. M. Clementel’s decision to resign followed on a speech in the Senate yesterday, in which he announced that the Government had decided to issue banknotes to the value of from 2,500,000,000 to 4,000,000,000 francs, employable only for the purpose of discounting commercial bills bearing the signatures of most solvent manufacturers and traders. He argued that this new paper issue was not an inflation, and declared that scarcity of bank-notes must be remedied by replacing those being hoarded. It is affirmed, however, that the Governor of the Bank of France considers the proposal inflation pure and simple. M. Clementel was frequently interrupted, and the speech created a bad impression. The Premier (M. Herriot) was summoned from the Chamber, and subsequently presided at a series of conferences between the Ministers and the majority groups, which continued until early morning, when dramatically the news was given out that M. Clementel had resigned. The Government’s resignation and later withdrawal followed. NOT INFLATION. MONEY REQUIRED FOR TRADE PURPOSES. LONDON, April 3. The Paris correspondent of the Daily Telegraph says it appears that when Cabinet discussed the question on Wednesday it was agreed that no reference should be made to inflation, either in the Senate or the Chamber. Consternation. therefore, reigned last nieht when it became known that M. elemental had uttered the fatal word. Following upon M. Clementel’s speech, senators surrounded the Ministers’ lobbies, demanding explanations. M. elemental complained that he had heen misunderstood. No inflation was contemplated-, hut a fresh issue of notes was necessary for trade requirements. Senators exclaimed that it was inflation, no matter how the Ministers explained it. Yesterday's bank return showed that the note circulation was within 20,000,000 francs of the statutory limit. The seriousness of the crisis ,is indicated hv the fact that the meeting of the Cabinet lasted until four o’clock in the morning. M. Painleve. the President of the Chamber, was present. It appears now that the report that Cabinet resigned unfounded.