104 ECONOMICS OF THE WAR. 



and by increased production, it was shown that their resources 

 could supply well in excess of their minimum requirements. 



Austria-Hungary. 



In Austria-Hungary War Credit Banks have also been estab- 

 lished, and a note issue forced on the public on an inconvertible 

 basis. The banks published no statements, so that it is impossible 

 to say whether the gold reserves of their banks have been 

 increased. At the outbreak of war they held 50 millions. It 

 is believed that some of the gold has been transferred to Ger- 

 man}-, but an estimate gives the present figure as So millions. 



They have raised internal loans of £130,000,000 for Austria 

 at 5 ^--2 per cent., and £60,000,000 for Hungary at 6 i)er ccr.t. A 

 further loan approximating £200,000.000 has been issued, the 

 result of which is not known. The counlr}- had a form of direct 

 taxation, but what has ha]:)pened in this direction since the war is 

 not known. The position of their credit, however, in their 

 budget must be an extremely unfavourable one, and the}' are 

 estimated to show a deficit of ^t, millions for the current }-ear. 

 From a quarter to a third of their foreign trade was done with 

 the Allies. Owing to the Adriatic being closed, their over-sea 

 trade generally has sufifered severely. They are forced to rely 

 on their internal resources. They are estimated to have in the 

 field an army of 3,500,000 men, and, as in Germany, their in- 

 dustries have been mobilised to meet the new situation. Tlieir 

 supplies of material for the conduct of the war must be limited. 

 With regard to food, however, they appear to have no serious 

 difficulties to meet. 



France. 



The Bank of France have increased their note-issue from 

 240 millions to 460 millions, and it is inconvertible. 



The gold held is 170 millions, as compared with 140 millions. 



France has raised loans mainly by the issue of Bonds of 

 National Defence, carrying interest at the rate of 5^ per cent., 

 to the extent of 400 millions. In addition to this, she has recently 

 placed 10 millions of one-year bills in New York, and I under- 

 stand that Germany also placed a small amount. 



In order to adjust exchange, the American bankers placed, 

 at the time of the war, 20 millions at their disposal, as they had 

 done in the case of Great Britain. Since then six millions of 

 this have been withdrawn to adjust exchanges. 



France's shipping has been practically uninterfered with. 

 Information is not available, but there is no doubt that they have 

 bought very largely in America, with the result that a big balance 

 will have to be met by the sale of foreign securities or export of 

 gold. France is estimated to have in the field an army of four 

 million men. and the whole of the male population, between 

 the ages of 20 and 48, has been called to the colours. As every 

 man in France is a soldier; it has been easv for that countr\- to 



