18 JULY 1931, Page 1

Dr. Luther was back in Berlin last Saturday and learnt

that the Darmstiidter and Nationalbank was driven to close its doors, and that extremists were trying to frighten the people by alarming reports of the collapse of Germany. On Monday the Government announced that it would guarantee the Bank's liabilities. Meanwhile the Board of the Bank for International Settlements was hard at work at Bale. The American President of the Bank, the Governors of the Banks of England and France and of other banks of issue were present, and were joined by Dr. Luther. It was decided to collaborate with the Central Banks in supporting the Reichsbank and to renew the rediscount credit which had already been accorded but falls due for renewal this week. This means that the B.I.S. can do no more now by itself without the Central Banks, and it throws back responsibility upon them. Those of them who are dependent on their Governments may be willing as financiers to help, but may be compelled to follow the Governments into political paths. No good can come of that, but possibly harm, and certainly delay where it is essential to hasten.

* * * *