The bankers know this and in their committees, they are undoubtedly discussing just these questions, Unless China recognizes. a its foreign obligations, there is little hope, for the. establishment of new credits, Tt is imposaile to raw a me between the Reorganiza-ton Loam and the Nishihara Loans; between the domestic loans secured on the. Customs Surplus and' those svldly lent by Chinese banks. Of ale, as legally constituted as any power to-day, signed the docu-monte of those loans. It they Souarilered the money, it was China's faulty i they abused the authority of their office to contract the loans, it was China's fal let them' do it. No one need. beyond the seal of a Minister of state from a legal standpoint, And in international finance, one deals with, laws. and. not with epigrams. Soviet Russia has learned that; Great Britain knew that. These two nations offer the mos! valid examples of the country without credit because of repudiation! of olms and the country which; has strained every sinew to pay a debt, which some principal persons, even in the lending country feel should, from ethical considerations, be cancelled. Russia, where the, proletariat and utopian idealists rule, permitted her national credit} to be destroyed; Great Britain, where the middle class is dominant, her debts as Chinese bankers amd merchants clear their balances every Chinese New Year.
have listened to this comparison several times during the past few, days. Chinese business men understand the value of a good name.
The Sense of Security But the recognition of all outstanding obligations is in itself not sufficient to create new credits.
There must be engendered a sense of security; there must be certainty hut the wars are at an end. For! instance, who can lend money to China while there is fighting? I remember an instance, when an American company was ready to put up funds for a large industrial development and the contract was ready for signature, when the news that Chi Hsieh-yuan and Lu Yung-hsiang had begun to fight was telegraphed to New York, dear was, of course, immediately, cancelled," The bankers then must protect their own prestige by making absolutely certain that there will be no fighting. That is not.
dificult task, if the bankers show: courage. After all, the National-fists would not to-day claim a vie~ tory over Peking were it not for! Shanghai's $86,000,000 and, should the bankers withhold further supplies, the military men could not fight.
"At present there is excellent reason to believe that the generals fare buying munitions in Central Europe. What for? Is not the war over! It is stupid to belie that nobody Knows about these plans except a few militarists in Nanking. All the world knows about them and the international bankers will have full details when it comes to a question of loans to China.
Text read from the printed page and cleaned; old type leaves the occasional error.