The financial event of the week has been the recovery
of the franc. A week ago the franc was at 121 to the £ ; at the time of writing it is at about 84. The immediate means by which this remarkable recovery has been effected is the arranging of credits of between 50 to 100 million dollars with Messrs. Morgans for about a year, and with Messrs. Lazard for £4,000,000 for about six months. Against these loans, gold in the Bank of France has been earmarked, so that if they have to be repaid this gold will have to be exported. The success of these operations has given the French Govern- ment exactly that breathing space which was absolutely necessary if it was to devise methods for the financial salvation of the country. France must now so completely overhaul her financial system as to make impossible a renewed inflation. As our City correspondent points out, if this is not done " both thoroughly and promptly, then, of course, the position will be really worsened, because France will have to export large amounts of gold to repay her credits." Already France has taken one important step towards financial reform, and that is the passing of M. Poincare's Bill authorizing a 20 per cent. general increase in taxation. This Bill finally passed the Senate on Friday by a majority of 13.
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