FRANCE'S FINANCES

Poverty Bay Herald, Volume LXIII, Issue 19038, 11 June 1936, Page 10

FRANCE'S FINANCES

LEFT MINISTRY'S NEEDS LOAN FROM AMERICA'? LONDON, May 2S. Sonic of the Fronch parties of the Loft aro discussing the possibility of a loan of about ' £200,000,000 from the United States. It is suggested that M. Blum's recent, references to tho French war debt wore intended to pave the way for such a transaction. The immediate difficulty with which Hit* incoming- Government (which M. Blum will protfnbly load) will be confronted is the finding of money to finance the public works which ithas promised. Constant Josses oi ! gold and tho disappearance of bank deposits into private hoards have made

the Paris money market so tight thai an ordinary Government loan cannot be floated at the moment. The Hank of France has already advanced so much to the Treasury that it cannot Jie expected to provide further accommodation voluntarily. The more extreme members of the Popular front, prefer to solve tin problem by compelling hoarders to disgorge. " Thev point out that tho Bank of France has lost £330;000,00(J in gold in tho past three years. Deposits in the savings banks have fallen by nearly £12,000,000 since January. ' The total value of gold and notes hoarded ia Franco is about i'r>:!0,000,000. If only part of this could be forced back into circulation the Left Government;'s public works programme could easily bo financed. One suggestion is that French investors who have expatriated funds should be given a fortnight to return them, on penalty of confiscation; and domestic hoarders should be fined.

Adherents of devaluation*, who are increasing in numbers, maintain that their solution would be the simplest, if carried out in an orderly manner. It would solve the financial problem, because funds would eventually flow back to Franco.

The Communists and Socialists continue to insist on maintaining ino integrity of the franc. The Radicals demand that no onerous currem-v restrictions shall be introduced. They wish to avoid undermining the stability of the currencv. '

These conflicts make if difficult, to formulate an agreed policy. Meanwhile, a series of strikes has l'roken out in Paris, affecting five large factories on the outskirts of the city. This sudden epidemic is reported to be partly due to the feeling among the men that they are likely to obtain more satisfaction than hitherto now that a Left Government is coming into power,