"A great upheaval took place in the world of finance. Credit resources were brought to the fore and nations established on a financial basis of far-reaching importance, but of a kind that had only a secondary place before.
"The war has turned the United States from a debtor to a creditor nation. Formerly we owed abroad something like $4,000,000,000, about three-quarters of which sum we have bought back. Moreover, Europe now owes us about $9,000,000,000—on private account; about $2,000,000,000 in securities; in United States Government obligations over $7,000,000,000. The world is under obligations to us in interest alone of between $400,000,000 and $500,000,000 a year."
After the United States took an active part in the war large credits and loans were made in behalf of other countries as the following excerpt shows:
"A total appropriation of $7,000,000,000 has been made, $3,000,000,000 by the Act of April 24, 1917, and $4,000,000,000 by the Act of September 24, 1917. Under these authorizations credits have been established in favor of the governments of Great Britain, France, Italy, Russia, Belgium, and Serbia. These loans, up to January 17, 1918, are given in the following table:
| Country | Loans and Credits | Loans | Balances Under |
|---|---|---|---|
| Agreed Upon | Made | Established Credits | |
| Great Britain | $2,045,000,000 | $1,985,000,000 | $ |
| France | 1,285,000,000 | 1,225,000,000 | |
| Italy | 500,000,000 | 450,000,000 | 50,000,000 |
| Russia | 325,000,000 | 187,729,750 | 137,270,250 |
| Belgium | 77,400,000 | 75,400,000 | 2,000,000 |
| Serbia | 6,000,000 | 4,200,000 | 1,800,000 |
| Totals | $4,238,400,000 | $3,927,329,750 | $311,070,250 |
"On the basis of the requests being made on the Treasury, it is estimated that credits aggregating approximately $500,000,000 per month will be required to meet the urgent war needs of the foreign governments receiving advances from the United States. At this rate approximately the entire appropriation authorized by Congress will be accredited to our Allies by the close of the present fiscal year (June 30, 1918).
"A significant feature of the loans floated in this country in the last three and a half years has been the fact that many states and municipalities which formerly went to London to sell their securities have recently been financed through the United States. About $150,000,000 of the Canadain Canadian loans went to provinces and municipalities, and many of the South American obligations were contracted for municipal improvements. The neutral nations of Europe have also sought accommodation in the American money market. Loans have been made to the city of Dublin, Ireland, the London Water Board, and the French cities of Paris, Bordeaux, Lyons, and Marseilles."
DISAPPEARANCE OF GOLD CURRENCY
During the war gold almost ceased to be currency in all the Allied countries. The Central Powers at the end of the struggle had comparatively little. Of the total gold production the United States produced about twenty-five percent., while the British Empire produced nearly sixty-four. A writer in the Edinburgh Review proposed to take the opportunity of creating a standard price for gold. For example, if the standard price of gold were reduced to half, the prices of all commodities would come down in sympathy. We must take advantage of the fact that we are working with a paper currency, and all authorities agree that financial stability is only secured by the backing of as much gold as possible against paper securities and emergencies.
The plan involved an increase of the standard price. The success of the scheme depends upon the concordant will of the United States and Great Britain to adopt it as the following article suggests: