DEBTS TO AMERICA

Waikato Times, Volume 112, Issue 18803, 26 November 1932, Page 5

DEBTS TO AMERICA

HOPE lit BRITAIN. CABINET MEETS MONDAY. FURTHER NOTE TO BE SENT. United Press Assn.—Elec. Tel. CopyrlgDt. LONDON, Nov 24. Feeling in official British circles remains hopeful. The passage in Air Hoover’s statement seeming to promise special consideration to such debtor nations as find immediate transfers impossible or hurtful owing to depreciated currency is regarded in most quarters as designed to meet the British case. One point emphasised is that no decision—payment or nonpayment—will be made by the British Government until the American reply is forthcoming after the next British Note Is received. The Cabinet is to meet on Monday to consider the situation. In the meantime the American Note will be circulated among Alinisters. The Debt Committee of the Cabinet will meet tomorrow. There was great activity at Whitehall to-day and numerous conferences of Alinisters with their diplomatic and economic advisers. It has not been decided yet when the American Note shall be published but presumably it will be simultaneous in London and Washington and may be delayed until an exchange of further Notes makes possible the publication of the complete correspondence. Following the announcement from Washington of the decision of the President, Air Hoover, not to accede to the request of Britain for a suspension of the war debt payment due on December 15, excitement ran high on the foreign exchange market in London. Sterling was offered heavily and fell to 3 dollars 244 cents, compared with 3.23 J, the lowest ever recorded since Britain left the gold standard. The closing quotation w'as 3.24§. The Stock Exchange opened weak, gilt-edged stocks generally being 1 to 2 per cent, lower. LONDON PRESS COMMENT. “ BRITAIN CANNOT PAY ” “NO SOLUTION TO OFFER." United Press Assn.—Elen. Tel. Copyright. LONDON, NOV. 25. While the rest of the press takes the matter calmly, the Daily Express and Daily Alail say emphatically that it is impossible for Britain to pay the United States.

The Empress, in an editorial article, asks: “llow does America suppose the payments can be made? By sending goods? The answer is that America would refuse to have them. By paying in dollars? The answer is that Britain lias got none. By paying pounds? The answer to that is that America knows that if Britain tried it would plunge exchange into chaolic dislocation. By sending gold? The answer is that it would mean a crisis and an Act of Parliament. The effect on world trade would be more disastrous to America than to us. Thus every door is closed. The American ‘die hards’ have one shot left, namely, to make Britain bankrupt.” The political contributor to the Express says: “ Britain will not pay. She will not refuse payment because she does not want to pay, but because she cannot. It is believed that Treasury officials are aware of the fact and are frankly admitting they are beaten by the situation and have no solution to offer. In fact, it is currently credited that Air Alontagu Norman, Governor of the Bank of England, has no solution to offer. There are rumours of Cabinet dissension and It is said that some Alinisters wish to make the payment, but the Cabinet knows full well Britain cannot pay." These statements and arguments are printed in large type, double column, on the main pages. They are finding no echo elsewhere and possibly will produce a political sensation to-day.

WILL FRANCE PAY. AI. HERRIOT’S 'DIFFICULTY. LONDON, Nov. 24. France’s position Is complicated by the fact that M. Herriot, the Prime Alinister, cannot order payment -of the December instalment of 'the war debt to the United States without the approval of 'the House of 'Deputies and Senate, which are likely to be insistent that it must not bo paid. On the other hand, Italy’s willingness to pay her £250,000 in December makes AI. Herriot reluctant to allow' France to default.

Berlin reports show that German official opinion on the British view is that further explanations to the United States are needed, but it considers that debt suspension does not affect Germany directly.