FINANCIAL NOTES.
As I stated in these columns weeks ago, the City has from the outset taken a businesslike view with regard to the German Loan. It regards it as the logical and necessary outcome of the acceptance of the Dawes Report. Accept that scheme and the External Loan for £40,000,000, which forms an essential part of it, follows as a matter of course. Not only so, but the agitation of the Daily Mail with regard to the Loan ministering to excessive German competition with this .country has failed -to convince the City. That German competition with or without the Loan will be a great 'factor in the future is probable, but it is recognized that one of the main objects of the Dawes plan is to stabilize German exchange and German currency (to that extent tending to check German competition), and, indeed, it is for that main purpose that the External
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Loan is required.
Consequently the City is preparing to give active support to the German Loan. At present there is no certain knowledge as to what the English proportion may be ; nor, indeed, is there any reliable information with regard to the details of the Loan. In the first place, I should expect, however, that the security mortgaged for the bondholders will be exceptionally large and exceptionally well guarded. For that sante -reason; therefore, I am inclined to think that some of the extra- ordinarily high yields which have been mentioned will prove to be beyond the mark. Latterly the market has been revising its estimate as to terms, and is now more prepared to see a yield of something nearer to 74 percent„ and if the details as-regards scourity-eome .up to expecta- tions, there is little doubt that the English portion of the Loan will --be not only successfully-underwritten but well
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