French Debt Conversion Mr. Chamberlain's successful conversion of 5 per
cent. War, Loan to the amount of £1,885,000,000 undoubtedly stimulated -and helped the French Finance Minister to obtain legislative assent last Saturday for the conversion of 80 milliards of rentes bearing interest at from _5 to per cent. The operation, though involving. barely a third of the amount of our War Loan, was more delicate in a political sense. Every thrifty Frenchman. is a .rentier, and the nominal value of his bonds has been reduced by four-fifths owing to the compulsory devalua- tion of the franc. For this reason the Government dare not propose less than 41 per cent. as the new rate of interest-1 per cent. higher than on our converted War Loan—and it had to make special arrangements for the poor holders whose little all was invested in rentes and who might be left with an income too small to live upon. The Chamber's decisive majority of 540 to 48 for the scheme shows that the compromise between financial and political needs is generally acceptable. French industry should benefit by -the general reduction in interest rates which this conversion scheme will bring about, and the French Government should bebelped in meeting what is believed to be an immense deficit in the coming Budget, without having to increase taxes that are, like ours, desperately burdensome.
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