SPECTRE OF RUIN.

New Zealand Herald, Volume LXIII, Issue 19386, 22 July 1926, Page 9

SPECTRE OF RUIN.

PANIC SEIZES FBANCE.

SOCIAL UPHEAVAL FEARED,

COLLAPSE OF CURRENCY.

PRICES SOARING RAPIDLY.

MANY SHOPS NOW CLOSED. PEOPLE IN UGLY MOOD. Ey Telegraph—Press Association— Copyright. (Received 5.35 i>.m.l A. and N.Z.-Reuter. PARIS. July 21. The situation in France as the result nf the collapse of the franc has passed the stage of mere, economics. It is now revealed as a political situation of the most dangerous type, such as might be a prelude to a social upheaval. M. Herriot's new Government has completely failed to inspire .confidence. Optimists say it may last a week. On the Bourse many speculators are frantically selling stocks in order to buy shares which are independent cf the value of the franc. Already shops where luxuries are sold are closing down, as trading is impossible in the face of the soaring prices. Someof them may remain closed for the summer. The shopkeepers in Paris are beseeching English and American tourists to pay them in pounds or in dollars—anything rather than in francs. On the other hand many visitors are most unpopular, as their purchases are undoubtedly driving up prices. 111-feeling Against Americans. Many people from the Dominions who are visiting Paris, or French watering places, are suffering inconvenience, but the strongest antipathy is shown against Americans The latter are openly blamed for France's ills, owing to Washington s debt policy. There have been some attacks on foreigners in ffie Montmartre cafes. The newspaper La Liberie suggests that every foreigner entering France should be compelled to pay a special tax in his own currency. Perhaps the most significant dangar-r-ignal is the growing state of panic among the peasantry. For instance ignorant peasants in the Biarritz district refuse to buy or sell. They say the franc has fallen 30 points in a single day, and it is impossible to foretell the future. The wildest rumours are being circulated in the district, including a statement to the effect thai Marshal Petain has been proclaimed Dictator of France. Tiiis rumour was denied, but confidence has not been restored.

Traders Widely Affected. Prices continue to soar as the franc falls, and traders are becoming nervous. The sugar exchange decided not to permit transactions at prices exceeding the closing rates on July 16. The silk manufacturers of Lyons telegraphed to the Presidents of the Chamber of Deputies and the Senate declaring that the fall of tha franc places the silk industry in an inextricable position and urging that the currency should be stabilised by the adoption of a plan proposed by a recent committee of experts. The Havre cotton and coffee brokers associations have decided to restrict operations. The Office has prohibited the inclusion of quotations of exchange rates, stock prices and the price of commodities tn wireless bulletins.

Outrages Against Tourists. Visitors to France report the growing tfl-feeling which is being exhibited for unfortunate tourists whom the French people apparently regard as the authors of their troubles. For several days the motor coaches of foreigners who are touring in Paris and the district have been greeted by catcalls and insulting eries, which the majority of the occupants fortunately could not understand. In one case 100 Frenchmen from cafes near by surrounded a car and began to drag out the sightseers who were driving in it. A policeman had to draw his revolver and call assistance. Two of the police were injured before the trouble ended. Many of the Paris shopkeepers removed the price labels from their goods and are charging customers according to their appearance. If they are rich French people: they are charged full prices, if they are rich foreigners they have to pay rather more. Another manifestation of anxiety lies in the fact 'that many business people, wholesale and retail, are taking lengthy holidays. They explain that their goods are their gold reserves and say they will not sell them until they know the price at which they can replenish their stocks. So they are putting up their shutters.

FEANC IN LONDON. A DOWNWARD TENDENCY. QUOTATIONS ON TUESDAY. (Received 5.5 p.m.) Reuter. LONDON. July 20. The exchange rate for the French franc opened at 232 to the pound this morning and closed at 239.25. The quotation for the Belgian franc was 220.