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June 18,


4y dear Dr. Vissering:

1y plans have now sufficiently matured to enable me to advise you that I am expecting to sail for :'.larope about the first of

July and that I shall hope to give myself the pleasure of a visit wits
you during my stay abroad.

4y arrangements are as yet a little indefinite, but I shall
probably be in London for a while. and then go either directly to Holland,

or, possibly, first to ?ranee and later to Holland via 3elgium.

I shall look forward with great pleasure to meeting you at
that time, and hope to have the good Fortuna of finding you at home.
With cordial regards, believe me,
Sincerely yours,

Dr. G. Vissering,
President, The Netherlands Sank,
Amsterdam, Holland.


Li 13RA"
JU L 5




Dear Dr. Vissoring:

:Ty depurture for Europe, uhich was fixed for Cle 1st of July,

has boon postponed to the 12th instant, on account of derrInmment
in the sailing sohed.alo of Cie '.7hite Star 71ns enused by labor
Aisturb:inces at Liverpool.

I now expect to sail on the Baltic on

the latter date and am rntioipating with pleasure seeing you egz in
t !n early date.

kindest regards, I am,
Sincerely yours,

Dr. G. Vissering,
The 'Tetherlrnds Bank,

`Insterasm, Holland.


Amsterdam, Holland
July 15, 1919

Federal Reserve Bank

New York
Teceived via Hoover your cable quote Federal Reserve Bank requires
that all gold shall be weighed in conformity with formula in paragraph
one and expects to make payments as rapidly as lots approximating
twenty million marks are completed and cable advices are received in
compliance with terms your cable unquote

We state that alternative

given in your cable directly to us on July second is caLclled by this


We execute your last instructions nrit have undertaken

the weighing; which will probably last three days for the first lot of

twenty million marks

We understand you agree Hoover will be via Brown

got informed of this Gobi.,

Nederlandsche Bank


New York,
July 16, 1919.

Yederlandsche Bank
rie regret that Hoovers advice to you whi,lh is evidently only part

of our cable to American Mission Paris caused you to consider same
as cancellation of alternative given in our cable July second


Please do not interpret the advice from Hoover as changing in any
respect the instructions in our direct cable to you of July second
which we hereby confirm

Federal :Reserve Bank

July :!


liLDLRLAliaXHE DANK, Amsterdam

New York repeated
Your cables seventeenth and nineteenth instant to
to me here


Suggect continue cabling reports to New York which

be re.)eated to me by FEDERAL RESERVE BANK stop

Planning to reach Brussels

early next week and Amsterdam shortly thereafter stop

Friday Ritz Rotel PARIS


Address until

August 6, 1919.

Dr. G. Visserint.,

NederLindsche Bank

Am arriving bit AmeteroLm tomorrow afternoon by mAdor and hove

telegraphed for rooms ut .he

Brkteke Doelen

ShAll hope to

have the pleasure of calling upon you Friciay morning if convenient for you.


SIWAG, Governor Feuerta
or New York

Reserve an.1.:

Brack's Doelen Hotel, Amsterdam,

August 11,1919.

My dear Dr. Viseering:

It is quite possible that some mail and telegrams will come to the
Bunk for me after I have left Amster:km, and I am writing to ask if you
will be good enough to have your secretary re:eat telegrams to me in care
of the stational Bank of Belijun, Brussels, until Friday of this week and
thereafter in care of Vergan, Harjee Y Company, Place Vendome, Paris.
,'my mail, I believe it wouA be safer to forward direct to 14ortah.,
Comlny, as I e;,all only be in Brussels a day or two and might
miss it.
It has been a great privilege to have this visit with you and with
your ascociatee, and I value greatly the opportunity to become personally accualnted and to have these discussions.
May I express the hope
that your institution and mine rill succeed in establishing a close relationship to our mutual advantage.
With warmest appreciation of your courtesy and hoping that you will
not fail to command me in New York in any nattera in which we can be of
sorvce to you or to your fine institution, I be to remain,
Faithfully yours;

Dr. G. Vissering,
Nederlandsche Bank,


HotA. 71tz,

uGust 16, 1919.


Owlet; to my proposed absence of a few weeks I find it necessary to
entrust to Li'. rent, who will present this letter, all armIgements in
regard to the shipment of gold to the Bank of :ngland.
It is of course understood thet the Prank of :rigland is to actually
take charge of the shipments, end I do not wish in any way to alter the
arrangement in that regard.

Nevertheless, Yr. rent will be in communication with the Federal
7eserve Bank of 7-ew York, of which he is still acting as Deputy Governor,
and I would greatly appreciate your enabling him to facilitate in every
way the carrying out of the arrangements covered by my written instructions to you of this date.

Mr. rent has his own code and check words to the Federal Bank
to enable him to conduct cable corresondence exactly as I have done
and he is li,:ewise thoroughly familiar with the details of the transaction.

7eithfUlly yours,

The Yederlandsche Bank,
kmsterdam, Folland.


Hotel Ritz, Faris,
August 16, 1919.

Dear Dr. Viscering:

Quite unexpectedly Y AM called to ConstaltinoLle, the trip seemingly
taking about four weeks.
In the meantime I have asked Mr. Kent to caJ.., at the
Bank of Englund and effect detailed arrangements in regard to the ani..Iment
of the gold rhich we discus:sod.
7n order that the neceseary payments may :;rom.tly ,Toceed I am going to
ask if you will be good enough to observe the foliowin plan:

Comjete the exact count and examination of ten lots of -,
each, as is now being done, and re.;ort the results by the present method
to the Federal Reserve Banker few York.

Examine the remaining
marks by the method which we diecussed, to wit, weigh the small begs without o.ening them, allowing for the
weight of the bags and reporting the result as accurately as can be estimated
to the Federal Reserve Bank of New York by the same method as is now being
sued in reporting the reJulte of the accurate counting and weighing of the first
ten lots.
The cables should be both direct in code and through the American
Legation for purposes of check.

The Bank of England 11....s been good enough to handle the Shipment of the
gold to London and Mr. F. I. Kent, whoucookanied me to Amsterdam's, is leaving
tomorre4 for London and there will discuss the arrangement of detai.s with
the Bank of England.
I u
furnishing him with the necessary letter of authority to handle the matter in my absence and am giving him a copy of this letter.
A cable just received from New York indicates that not over I4,---,-'- in any
one Shipment Gun be covered by insurance payable in dollars.
Of course, all
the gold should be insured, and the Bank of England is being asked to accommodate their plane to this limitationif it proves tobe final.

It ia our resent intentiyh to ship a total of
marks to London
and Isbell await my return and further advice* from the Feder-i Reserve Ban
aa to the disposition of the remaining 7
marks, being the amount
accurately examined.

With many thanks for your courtesy and looking forward to - further visit
with you on my return from Constantino,-le, I beg to remain,

Dr. G. Vissering,
Nederlandsche Bank,
Amsterdam, Holland.

Hate_ Ritz, Paris,
August 16, 1919.


y dear Dr. Vi_vsering:

my regret it seems desirable that I should accom.any an offlciai
-rty t Constantinople and I find myself with only time to send you the enclosed official letter with these very warn thanks for your many courtesies
to me whiie in Amsterdam, which I deeply appreciate.
It was grout pleasure to visit you and become -,-.:erzonally ac.,uainted -nd

to find such great harmamyin our views.
Your co)peration wit. the Burr of England and with Mr. Kent in arranging
this gold mutter is very greatly a,preciated, and I can aosure you that the
Federal Reserve Bank of New York will reci,rocate by every means in its power.
Very sincerely yours,

Dr. G. Viscering,
The Nederlandsche Bank,
Amsterdam, Rolland.

Hotel nits, Tarts,
August 17, 1919.

Yy dear nr. Vissering:

In my letter of yesterday I omitted to refer to the question of exerts° in connection with the handling of the gold.
It is uederstood of course that we will reimburse you for all expense and outlay in connection with the verification and shipment of the
gold, which I understand will include the compensation paid to your men
for overtire work.
It Is impossible for me to advise you definitely of the amount to
be left with the Nelerlandsche Temk for safekeeping, until my return, when
sh:-.11 have heard from the Federal Reserve Bank, but it is understood
that if the Bnk authorizes, as I shall recommend, the reimbursement of
all charges which rn have made for the custody of gold held for the accollet of the 77ederlardsehe Bank at !:ew York, the Nederlandsche Bank will
than be willing to take the custody of this gold without commission

Tor purposes of a:'counting,to cover the period when our books have
bac_ cloned, we may ask that the amount of the fee to be reimbursed be
charged back to the Federal Reserve Errik as a custody fee In connection
with this transaction.
You ma be assured, my dear Dr. Vissering, that it is my desire, and
sure that of my associates, that the relations between the two instiI
tutions shall be established upon a basis free of commission charge, if
that is quite agreeable to you.

Again with assurance of ray esteem and many thanks, I am,
Sincerely yours,

Dr. G' Vissering,
resident the Vederlendsche Bank,
t_msterdam, Holland.

(Following cable received at Paris August 18th)

Amsterdam 59296




Care of National Bank of Belgium

Received following telegram


Terms unknown to
Learn from New York insurance can be arranged
Governor Bank of England
Bank but understood cabled you direct


(Following cable received at Paris '.ugust 18th)

Amsterdam 5982





59 M


Care of Morgan Hrjes & Company, *Place Vendome, Paris
Received following telegram


We are ready to send to take delivery at both centres as soon as
We await terms upon which to insure with Chubb
Bank of England


Paris, August le,

Doctor G. Viceerinz
Nederlandsche Bank

Rave abandoned
trip to

my telegraphic

OonstLtinodlci of wlich
I have written
you stop
address Qontluaes
care Aorgan
Harjes and company




My dear Mr. Strong

21At August 1919


From your letter of August 16th we noted your
wishes about the further examination of the gold deposited with
us by the German Reichsbank for the account of the Federal Reserve
Bank of Newyork , and about snipping of 240 million Marks to the

Bank of England


We are awaiting further instructions either
from you or on your authorization from the Bank of England about
the shipments and about the question if insurance will be covered
by the Bank of England


I suppose that your suggestion to solve the
question of the commission , paid by the Netherlands Bank on the

deposit of gold in Newyork


will be very attractive . We from

our side will be happy to come to an understanding that both parties will store up the gold in the shape of earmarking for the

account of one another without any commission
of weighing





the extra expenses

etc. only to be reimbursed


Very sincerely y

President of the Netherlands Bank
Benjamin Strong Esq.
Governor of the Federal Reserve Bank of Newyork
Federal Reserve Bank of St. Louis

Hotel Ritz



My dear Mr. Strong


I received your two letters of August 16th
and your letter of August 17th

and only yesterday your wire

of probably 16 August reached me



see from your wire that you have abandone

your plan to make a trip to Constantinopel


I sincerely hope

therefore that we may have again the pleasure to see you in



for I would highly appreciate to have still a talk

with you on several of the extremely delicate questions that
are to be solved in the next time


I had the advantage in th

meantime to see Mr. Paul Warburg on his way to his family . He

also is very much impressed by the serious situation everywher
in Europe


and in the end no less in America

for of course

various difficulties in Europe must finally have their repercussion in America


Would it not be possible to use the very

opportunity that several so very prominent men from

America are just now staying in Europe
of course quite informally

to have a discussion

- on all these problems


and would

it be possible for you to spend some days especially for this
purpose ?

I should highly appreciate if such a meeting could

take place in Holland ; we may then have also the opportunity

to change views with some of the prominent men here
the first place with mr. Ter Meulen from Hope & eo
Benjamin Strong Esq.
Governor of the Federal Reserve Bank of Newyork

Hotel Ritz

f.i. in

Of course


Amsterdam ,


lst August 1919


I would be ready to go abroad if it would be more convenient to

you and the other gentlemen that might be present to meet at anoth


I get the impression from all serious men of

business I have seen in the last months that they want to
co-operate to any practicable solution and that they all see the

necessity of coming to some understanding in these intricate matters of international exchange


so I feel that it is the duty

of all of us to do the utmost each in his own sphere to come to
the rescue of the European comrunity


Would you be so kind to inform me if it would
If you could inform

be possible for you to come back to Holland ?

us some time before


we will try to arrange another trip for you

to some interesting parts of our own country


Very sincerely yours

President of the Netherlands Bank

Benjamin Strong Esq.
Governor of the Federal Reserve Bank of Newyor4
Hotel Kite

P A R I S.



GeV.- *

of gradual improvement, not only in a material way but in general in
the state of mind of the war-weary population of Europe.
Just as soon as the business which now detains me in Paris is completed I sh-11 telegrajh you of my intention to visit Aaterdam with
sufficient notice so that you may not be inconvenienced.
Again with kindest regards and many thanks for your courtesies, I
beg to remain,
Sincerely yours,

Dr. G. Viccering,
The Nederlandsche Bank,
Ameterdan, Holland.

Hotel Ritz, Paris,
August 25, 1919.

My dear Dr. Viseering:

Your favor of the 21st instant Net reaches me and by now you will
have doubtless heard free the Bank of England in regard to the arrangements for a:LAI:ping 240,000,000 marks gold to the Bank of England.
I am informed by the Governor of the Bank of Englund that re)reeentatives of the Bank are to be in Ansterday this week to arrange
the matter.
Since my return to Paris I have obtained more precise information
In regard to the amount of the payment to be made in connection with the
matter we discussed, and have decided that it will not be necessary
to leave more than
marks for safekeeping with your good institution.
I am therefore writing to advise you that instructions are
being sent to the Bank of England to shit a total of 564,000,000 marks,
the amount to be left with you being four lots of German
have been exactly verified, the weight, quality and value of each therefore being already reported.
May I trouble you to inform the rc2resentutives of the Bunk of
England to this effect and that I 4M writing to the Governor of the
Bank in order that they may receive their Instructions direct from

I may say that I am still without final authorization from the
Federal Reserve Bank in regard to this matter, as cables seam to be
greatly delayed, but I have no doubt that thin arrunocient, together
with the arrangement which I proposed in regard to comaissions, will
be entirely satisfactory to my associates in New York and I um grateful to you for your kind coo'eration.
Very sincerely yours,

Dr. G. Visoering, President,
De Nsderlandeche Bank,
Amsterdam, Holland.


Hotel Ritz, Paris,

August 26, 1919.

My dear Dr. Viseerings

With this I am enclosing copy of a note of introduction which I
have taken the liberty of handing to Mr. Dean Jay, of Mensrs. MorzAn,
!, cork um,y,,


Mr. Jay is a personal friend for whom I have a very high regard,
and I need not unsure you of his reliability and trustworthiness.

Then I learned th the nature of his errand to Amsterdam, it occurred to me that it might be to his advantage and yours to meet and
discuss the plans which he has in mind, and it well may be that I can
reach Amsterdam before he leaves and discuss thematter in person.
advice which you find it possible to givehin will be much appreciated
by me.

I an looking forward to reaching Amsterdam the latter part of this
week, or early next week, and will telegraph you a few days in advance
of my arrival.
With kindest regards, I beg to remain,
Sincerely yours,

Dr. G. Vioserinz,
De Nederlandache Bank,
Amsterdam, Holland.


Hotel Ritz, Paris,
August 26, 1919.

gy dear Dr. Vissering:

This note will be presented to you by !T. Dean Jay, of New York,
who is a valued friend and was formerly associated with ue in the Liberty
Loan organization of New York.
21r. Jay has been for aome years connected with the Guaranty Trust
Com2any, but has recently associated himself in an important capacity
with the firm of 4L: P. Morgan & Company, of New York, and Morgan, Harjes
& Company, of Paria.

mr. Jay is about to proceod to Amsterdam an an important mission for
his firm and I have taken the liberty of suggesting that he call upon you
and seek your advice in regard to the business in which he is interested.
You may be sure of my appreciation of anything Which you may be able
to do to facilitate Mr. Jay.
With assurance of my esteem, I'beg to remain,
Sincerely yours,

Dr. G. Vissering, President,
De Nederlandsche Bank
Amsterdam, Holland.

BS /'l


Hotel Hitt, Paris,


ry d4c.r Dr. Yinseringt

k cab' n just received frer. tho Fedoshl Reonne Bank of Newiork oclviaee of a casange in the :-.Togrury. in regard to the handlity: of our gold,
..,hick nale....e i.t rocesrst.-.ry t.7N
tbn entiro Amami. nor hold 1): your
institution to London. This T. regret, but, I feel obliged to oarry out
thee() inefructl.-ms ltnlosts the sho..ild be altered. 'Dofore
Alastere..o- -,1),Jut VI'tdnend.L.y or Thured.-...y of next week.


Advice of this change of progre2ra in being vent to thn lank
t..11 f3 request that t''.eir re:-Ires&ntativen



I arj
!Jed that the tot,-,.1 .Noun; which Lucy be insured in
any one cenveyJnce is r;6,,er),e,,,;', thin ...,nour.t tc... Include the value of
the gold plus onr, .,er cent. allowance !..*--dr cost )2 shipmer..t.

I am planning to leave here on Tuesday, e2twid one day in BruJsels,
and tarn ;:roceed to Aasterdaili, whero 7 d!, 11 hope to k-,-end.

but I very ranch Tear that it will not be possible for ;:x to t1.c.2:e
trip :ua Holland *nich I la,1 conteaplated.
If wo

There arc many m4Atera which I an
Tel cluito 're-; tho latter :.!art



diccues with you, and,
nagt wank, wo will I hope have

Jek;:i-3uria to

for a furt%er

kiiLdeLt roe; a:, ii4d..t..h.441-,.ii4g, you. fc.r ,y.)ur courtesy in handling

vino ,;.22.c1


1)el.i.lf, 7 bez to :maim,

Faithfully yours,
=7,r. G. VitiserirL,;, :'resident,
Be liederl.andsche


for Wr.Strong.

6 September 1919




Remaining germangold consists of Marks hundredtwentymillion
grossweights Kilograms fortyseventhousand fiveeightyfive grams nineninetyfourhalf.Roubles fivemillionfivehundredthousand Kilograms fourthousandsevenhundredthirteen grams sixninetyeight-Austriancrowns eighteenmillionthreehundredthousand Kilograms sixthousandoneninetythree grams eightninetythrechalf,Sovereigns onemillionfivehundredfiftyfourthousand fivehundred Kilograms twelve thousandfourthirteen grams sixhundredseven.

Bars onethousandsevenhundredninetynine Kilograms twentyonet_ousandnineseventyfour grams twothirtytwohalf.Nettweight bars according to germanstatement Kilogrammes twentyonethousandeightthirtyseven grams threehundredfortycommafour total grossweight Kilograms ninetytwothousand
eighthundredeightyone grams fourtwentyfivehald 8244541


Ned,rlandsche Bank

1:otel Ritz, London,

September C


My dear Dr. Vissering:

My visit with you was most delightful and I am writing at once to
express my warm a:Treciation of your courtesy.
Later in the day I hope to learn definitely about my steamer accommodations and will telegraph you the possibility of a hurried visit
to Amsterdam to meet Mr. Warburg, but, as I notice the Baltic is scheduled
to sail on the 19th which would necessitate my leaving London on the
18th, it would so curtail my time here that I fear another trip to Amsterdam will be difficult if not impossible.
On going over the various cable advices from New York giving the results of the examination of the gold, I find that in a few cases the
fractions are incomplete by reason of mutilated cables and am writing to
ask if a cornlete statement maarizing all re-2orts sent by cable could
be made up and sent to me here.
May I reoeat the hope ex.xessed to you verbally that you make the
ciportunity before very long to visit us in America.
It has always
seemed to me that these visits are ,,roductive of excellent results, and
I shall never regret having taken this occasion to visit you in Amster-

With kindest regards, I beg to relaain,
Sincerely yours,

Dr. G. Vissering,
De Nederlandsche Bank,




London, September 8, 1919.



De Nederlandsche Bank
Must leave London on eighteenth to catch steamer sailing nineteenth
so regret impossibility meeting with Warburg as proposed stop


telegraphed him Sarvetta House St. Moritz to this effect stop










II est intcrdit aux

Scheer van Telegrafen en Teletonen



aucune gratification.

ambassade sta;sunis bruxetdes




gen geese belooning,






Indications de service les plus usitees inscrites eventuellement en tete de l'adresse, en toutes lettrcs ou en abrege :
Aleest vonrkomende dienstaanwikingen die, als er Tijn, voluit of verkort poor het adres norden geschreven :
Teleg. avec accuse de recep-

n Teleg. urgent

Dringend teleg.

v Di Expres pave
RP# Antwourd betaald A I I Bode betaald
Reponse payee


n tion postal
tion telegraphigle
releg, met teiegrcfische ken- pCr Teleg. met kennisgeving van
ortvang per post

nisgeving van ontvang

1.'litat nest sot:tills a aucune rcsporsabilite a raison du service de la coircsrenclarce Trivee par vole telegrarhque (I.oi du I" mars 1651, art. 6).
Luidrns art. 6 der wet ran I' OlaaJt 1-51. is de Staat geensi. ins verantwoordehjk l'cor den dienst der bikondere telegrammen,


A fzc

amsurdam 8012


12.7 a

= Priers demander monsieur benlamin
stron0 probablevot a
DruxeuGes mercredl de
vouLoir nous AetePrapPicr si pus ine
dilZe exaota de, sa visit

a, amsterdam en

Fenaapeuats presidPmt
redprLandsche bang

He d autres






11th September 1919

Benjamin Strong Esq.

My dear Mr. Strong


I received your letter of September dth from
London and your telegram reached me already before
will sail on the 19th inst. per S. S.



mentionthat you


I regret very much that we will not have the
pleasure again to see you here in Amsterdam and especially that it will
be now impossible for you to have a conference with Mr. Paul Warburg,

for I fully agree with you that such conferences wiWihave very good


mind and are throwing a new light on

as they clear up

these very difficult problems that can be solved only after very mature


I thank you again for the trouble you have given

yourselves/ to come to Amsterdam


and we all have highly appreciated

that you have given so much time to discuss these problems with us


I send you enclosed two copies of the memorandum which , as I told you


I have made up about these questions



request you to see in this memorandum only the utterance of some ideas
which have come up in my mind during the several discussions
is not a plan


so it

but it contents only some renArks about the possibility

of taking some measures as have been suggested during these conversations


Will you be so kind to hand one of these copies to Mr. rent

with my best greetings


Wishing you a very good journey and hoping






Amsterdam , 11th September 1919

Benjamin Strong Esq.

not too distant
to have the great advantage to meet you again in a


I beg to remain
Very sincerely yours,/,_

President of the Netherlands Bank

2 enclosures




he opinion is gaining ground on every hand that America in
the first plaoe, but also the neutral stltes, should now join
in oo-operating towards the improvement in the conditions provailim; in the countries which participated in th e war, and one

of the most urIent steps will be planning a oredit system in
°connection with the terrible and unpreoedented depreciation of
the various currencies and of ti-.0 dislocation of the universal'

bill and money traffio.

the enormous differimees which have

eons about during and sines the war in the relation of the imports and exports of various countries to each other, and the
terrific increase in the circulation of fiduciary paper, have
created differenoos in the rates of exchange of the various
cIuntries whidh are so wide that they can no longer be oontrolled by the application of the old method of .-..ending gold or

drawing a cheque on a balance abroad.

:)ther measures of a much

more radical nature will therefore have to be adopted for the
time being, amongst which we must in the first place oanoider
the granting of credit to the countries which have been so sewer#
ely visited by the war.

the population of these countries must

be enabled to return to work so that the willingness to work is
not frustrated by the impossibility of obtaining raw products,
rolling stock, coal and so many other goods indispensable to
bringing society into its working stride again.
It has already been premised that there must here bo no
question of affording aid to a single oountry or even a single
group of countries which were allied durins the A.m.; the inter-

ests of the whole of 2urope are here at stake and, if well-oonsidered, even of the whole world.

If therefore an organisation

were formed for this purpose, snob en organisation would eventually have to take measures applieable to all countries which
have suffered in oonew7uonee of the

ar, on whatever side they

fought, and which of courne can be considered to be in need of
such aid towards reconstruction.

In view of subsequent discussion one could divide the variouP
countries into two parties:

(0 on the one hand the lending countries*, i.e. ;'ho are

prepared to oo-oporate in furnishing the means of reconstruction
to the countries mentioned sub (b);
(b) on the other hand the nborrowing ceeuntrieee, i.e. the

countries Which are to reoeive the assistanee.

The lending countries would in the first place have to inOlude the United States, of North America, one or more of the
south American States and, of the neutral ceYuntries in 4uropet

the Netherlands, Switserland, the three soandinavian countries

and perhaps also Spain, although the last7tioned would be

Behind the Netherlands
the Netherlands Nast Indies.

bable that.

eurtner, it is moat pro-

2ngland oould also partloipate to a certain allount

on this ei4).

The object of this assistance ream be to came to the help of
the borrowing countries at as favourable conditions as possible.
The lending countries

at not terefore cherish the intention

of making a financialljerofitable buainees of it.

On the other

hand the lending countries will have the right, one might even
say the duty, to demane that absolutely first oleos security
should be furnished by the borrowing countries in return for the
funds advanced to .hers, either in the form of money or in the

Corm of merchandise.


Ave first rate guarantees eill, besides,

(preeliselyibo a good reason for rlaing the finmcial terms an
easy as possible for the borrowing countries.
moth for the reasons aboveriontioned, ant also in order to

avoid any further froinsement, as great a dee7ee of uniformity a
as possible will have to be reined, at in the terms to be submit-

ted to the borrowing countries.

A differentiative arrangement

f'r any single ani senarate state might perhaps eauee a erievInce and act eonerhat a' a repellant.

If it is clearly the in-

teetiol to make the oonditione as equal as possible for all
countries together, this element of a less apprectiative nature
oan be omitted.

Above all, therefore, excellent guarant--)ee

for the payment of interest and for the regular anausl azortlz




ation of the funds placed at the disposal of the borrowin4. count

ries will have to he looked for.
;enerally speaking thia credit could be granted in thmlo
different ways:
1. by the creation or a newsraece2ting busineade

2. by lending money for longer periods, so that the grantinj
of suah credit would have to take place more in the form of an

by taking over large going oonoerna with foreign capital
and to render it possible for the exploitation of these con°erns to be oantinuod under the new oirou7mtancee.
Re 1.

-she oacoepting business" will, from the very nature

of it, have to be created for transactions which would have to
be financially oompleted in a oar.paratively abort wpaco of time.
i'or this purpose a now body would have to be established having

as ita sp.Aaal objoot the acceptance of bills for thoue transactions

Li h, after mature consideration, are entitled to such


Let us assume that ouch a body had a capital of

2L) ml.11icn, anti that the greatest part of the capital were

taken up by America; that the rest should be distribwAd over a
number of neutral states, for whiCh purpose the Netherlands,
C;witzerlanU, the ;_icandinavian oauntries

per haps a few of the

.r:-:ariean States and possibly .:2ain would in the first

place oome into aonsidaration.

The possibility' of ong6ing

i_:agland in the arran;;enent mu.3t certainly not bo exoluded, in

spite of the fact t a ::ngland was involved in the war.


wacoeptanoe bank" would on.11 aeon the co-operation of the
woentral be.nkew in the variouo osuntrica ao that the latter

would be prepared to discount
anoo bank.

billa accepted by the acoopt-

this would simultaneous17 create an official die -

count .1;:arket for these bills std they would almost certainly be

generally plc ood on the open market.

lie acceptance bank could

Ahem be authorised to aooept bills to the suitor four or at most

six times its own capital. This. would thus Greats a oredit
faoility of z

11 123 to A 175 oi/lion.

It goes without saying



that the further limaturee tc t:A) bills must be well secured,

that one should be able to oonei-der those bills as being amens
the best co:z2)roial bills obtainahle at that monent, and a

strict oontrol.would have to be maintained on the :7antin1 of
the mew:Ito:use by the aceeetanoe bank on these bills.


that these aoceptance credits are exclusively ;7;ranted for trane-

actione *hid!: must be financially oonoleted within a short spaoe

of time, such an aocieptim facility by this bark


nfford a oonsiAerable wgpport to the international market; for
if these mature in three menthe, the acceptance facility con
be run up to four tines t'.e areount in one year, and if the

bills should have a =money of six months, to twioe this

Moreover the action of this aoceptanoe bank night also

induce the private banks to join in working in thOdirestion,
and also to interest tliemselves in really mound oommeroial

transeotiono, whioh would naturally still further extend the
grnnting or credit by way of aeoepting. business.

This idea will still here to be worked out as to whioll

oountries will be able to join in this form of credit wanting
and also as to shat anounts they are eventwIlly prepared to ooseerate.



attained in the value of the bond, expressed in the various

?he war has rendered this method exceedingly dif-

fioult, if not ineoesible, for during and owing to the ear
vitreous oeuntriee oould or would not maintain the gold basis

or their oen curenoies. ee have seen that the benieerent
oountries have been forced to reeall gold iron circulation, and
to euepend the export of *fold, in other words to give up maintaining the rate of exohange via -& -vis of foreign countries.
eels has brought about fluotuations between the rattel of exchange

to a degree formerly unknown.

In :'woolen, the remarkable cir-

ourstanoo has even occurred that this country, in no way oblig-

ated but of its on free will, made its currency free from the
:fold basis,

she coneequenoe was an absolutely incalculable

rise of the Swedish Orown as a medium of payment in Sweden.


make these notes payable 11 the currency of a nurbor of different countries will therefore not be aeain poaPible before all


these oountries have returned to the strictly gold beets,

is at present not yet the case and it is quite uncertain if

in be the case in the future and if no, when.



these oirouestanoes one must naturally oonclude that it would
be an impoveibility to creete a note that .lould be payable on

really the sane basis ie United Staeae

eeelise 2aunds,

Dutch guilders, floandinevian crowns and Swiss francs on the one

hand, or the liabilities of which, by the borrowing oountrien
on the other hand, could be fixed on the same footing in Prench
or DOlelan eranoss German -arks, Austrian orowns, Italian lire,
or in Polish or iielenian currency.

If notwithstendine this an

a tenet in made to is-ue a uniform note for all the lending
oountries, this will not be pew:Able otherwise than by making out

the note in the currency of the country which will take up the
bulk of these note., so that the note will necessarily have to
be nade out in United :Mates Dollars.

Perhape one could lino

try, -ide by side with this, to meece the note payable in enelish

pounds, on the express condition that this should be taken
mean cold sovereigns.

The quection, however, then still re-

mains as to how far it will be poneible to really w


the gum

of so many milliards in the long run pee-3131e in enelieh gold.
If however
Federal Reserve Bank of St. Louis

the notes are made out In one ourrenoy, e.g. United


The great puzzle in therefore in the construction of these plans When
Federal Reserve Bank of St. Louis

organizing the unieerral note for the lending countries.


These 1 3 milliard would be distributed among the borrowing
Federal Reserve Bank of St. Louis

as fol./owe:


tribution of the funds lent and oolleot the money to be devoted


the eaynent of interent and amortization to the I. u. on be-


had paid into the ouaranteo fund.

ing countries

If therefore all the borrow-

have e*Aually ailfilled all their obligation()




Ye cannot deny that many problons will still arise on plan-

ning nuah an orgenisetion; on most difficult point indsodowill

for instance be to what extant the notes of ono borrowing country 'then dosed in the lenlin; c'suntriee can bi3 niamed on the

sane level as tho notes of anotiler borrowing oauntry, eM, especially, bow they can be kept there. The guarantee fluid under

the nanaaoment of the I.G. will however undoubtedly have con:siJarable influence to7mrds bringing and keeping the estimation

and monetary value of thee° notes as much an ponable on the
same level. Purther, it will naturally be of preponderant importanoe that the committees in the borroTini; countries should

furnish guaranteea which are adequate in every sense of the word

bo rsufficiantly

and that tho levies for the service of the

should such a sohene be 'serried out, eloh lenAing country

will than receive notes nado out in its on ourrmoy, no that
the alrortisation can also be guarentrJed in that currency,

the queetion or the rates of of the borrowing conntriec
vin-h-vim of the lending countries, \lhenever t'

tomer receive

,;oods *'rot: the latter, can also be solved in this mannor.

Re S.

A third method t:lat right be applied is, as remarked

above, that capital mhould be ocllected in foreisn countries to

tnke over gam: concerns in various oountries Which onuld not
continue or not properly oontinue their exploiLation owing to
the bush of capital.

All kinds of (*neer= could be selected

flor thie purpono, either aGrieultura/ or industrial, lapse hotel

ooncerne and even /Arlo baths, such as existing watering places,

wbieh in view of their medical value must eventually ba re-opened to large numbera of foreign visitors.

?recinaly the fa ©t

that moh 7aterin7; nieces are finaneed by an intornatianal eyndictate,

rill do much towards bringing baok

fornor propperity

to these places, (here !lationalistie prejudioes need no longer

prevent visitors from Jta7ing thore, and whereby medical science
throughout the wholo

would ba ;Teatly benafited,

Another poo3ibility is for itz.tanoe the ex:Ilittatio-1 of
elect ric power from the rivers; and mkterfalls in Austria.





Ritz hotel, London,
.3eptember 17,

Ly dear Doctor Vissering:

Your letter of 6eptember llth with the enclosures has
just reached me, and I look forward to reading to e memorandum

with Freat interest and profit.

One copy I


sending to


Kent with tine suggestion that, if it is possible for rim to oe

in Amsterlpm again to meet you and Mr. 4arburF, it would be highly desi:able for nim to arrange it.

I am most regretful to oe

obliged to return without attending such a meeting myself, but
matters at home stem to u,ake it necessary for me to return.

it has been a very great pleasure to me to meet you and
I have profited much by our discussions.

You may count upon

hearing from me as soon as any matters of interest tae form at

.oith kindest regards and many thanks for your courtesies
to me,

I bfg to remain,

jincere1y yours,

Doctor D. Vissering,
liederlandsche Bank,

Amsterdam, holland.




January 26th


Benjamin Strong E


Governor of

My dear Mr. Strong


of which the last of Jan

I hearty regret that you

and you had the intentio

hand I have noted with v

intention to make abraWA

a very great pleasure to
your trip over Java



of the most interesting

I will introduce you ent

the Governor-Ge




residing at Bui


my friends of t


Dr. Bosscha



plantations in the neigh

Mr. David Birri

part of Java ( especiall

and then I should m
to the Idjen -Plateau

you hospitality





if not the most wonderfu





benjamin Strong Esq.



banker and financier from Belgium , went there on my recommendation


and after having travelled throughhout nearly the whole world

especially after a trip over British-Iia , he exclaimed that the
most beautiful thing he had ever seen was the Idjen-Plateau with
its incomparable crater-lake of the Kawah-idjen .

Several times

I have visited South-Italy and Sicily in order that I could compare
these two wonders of nature


but my impression of the Idjen-Platea

was that it was still muk, more interesting and still more magnific
then the Italian crater-regions


I will write directly to all

these gentlemen so that you can be sure that at the moment you will
be arrived at Java , you will find every assistance

if you will

have only the precaution to wire to the Javasche Bank the day of
your arrival


I think that it will be better to send the letters

of introducalrectly to Java , in order to avoid further perils of

these letters being lost in sending them to a remote spot in America

You will have heard of course that our memorand
has now been published in the eight countries who were represented
at the preparing cilferencea in Amsterdam



and still in some other

and uptil now the impression has been very good


I expect that the book of Mr. Keynes will have
a very sound influence on the public mind all over the world ; it

is really a splendid book
In order to prepare the public opinion also in
our country for the e:x.pected publication of the memorandum ,


I have







Januarl 26th




Benjamin Strong


written a series of articles in one of the leading papers here

the Algemeen Handeisblad



These articles have been reprinted

and published as a pamphlet in Holland


and a trarilation of it

will appear in English with the support of Messrs Macmillan xc Cy
as editors


I will send you as soon as possible a copy of this

brochure in Englioh


I have had the pleasure to see :.1r, Kent not

only on the both conferences held at Amaterdiia

him in Paris during the last days of the year

but also to meet

I thank you very much for your kind wishes at

the occasion of the New-Year


and I reciprocate them most hearty.

With kindest regards and very respectfully


Amsterdam , March 6th




Benjamin Strong Esq.

Governor of the Federal Reserve Bank of Newyork

My dear Mr. Strong ,

I received your letter of February 6th ,

and I read with very great pleasure that you are on the point to
come to the execution of your project to make a long journey
through the Great East , and it was a specially(great satisfaction
to me that you have the intention to go also to Java , and possibly
to Sumatra and Borneo


A journey to Borneo is rather troublesome


I think it will be best to get informations about the possibility
of going there during your stay at Java


Some parts of Sumatra

are very interesting , and especially would be very interesting to

make a trip from

Padang through the interior of Sumatra , either

to Palembang via the rapids of the Kampar-river ,

the plateau of Central Sumatra to Medan

or otherwi

Also such a trip could

be organized best in Java
I have informed His Excellency the GovernorGeneral , Count van Limburg Stirum ; my good friends President and

Directors of the " Javasche Bank "

most prominent tea-planters
Idjen-plateau ( East Java



Mr. R. Bosccha , one of the


Mr. Couvreur , residing at the splendid


and Mx. D. Birnie


one of the first

planters , at Djember , of your arrival in Java , and I have asked

them to give you all the assistance and facilities that you should
want or like


and I am sure that they all will do their utmost to





March 6th




Benjamin Str


make the trip as pleasa

Therefore I will not se

American Ambassy at Tok

directly to Java , but

" Javasche Bank " in ti
harbour of Batavia )


platform to receive you
Tandjong-Priok .

I wi

Office in Newyork , to

the American Ambassador

one of these letters wi
I have written to Java

will not only be a plea

you will be able to get

activities of our beaut

an opportunity to retur

have the pleasure of se

Phoenix, Arizona, March:1:::::11111111ill


-Dr, G. Vissering,
Amsterdam, Holland.

my dear Dr. Vissering:

It vas a very great pleasure to receive your
kind letter of January 26th, w'ioh has only now reached
me because I have been wandering over the desert of Arizona,
and even into Mexico since early in February. Ue have had
a most enjoyable and interesting trip which has done me a
great deal of good, and now we are prepL.ring to sail for
Japan from San Francisco on April 10th.

The letters of introduction which you were good
enough to forward to Java will indeed give us the opportunity
for a most interesting and instructive visit for which we
must thank you. Pceeibly you recall my telling you when I
w= in Amsterdam last summer that Lone day I expected to
visit Java, but I little realized then how soon I wculd be
We shall visit the places recommended in your
letter, and I shall also take the precaution of wiring in
advF:Iice to the Javaoche Bank, notifying them of the day of
our expected arrival.
Mr. Kent has written me frequently and fully
of the good work which you and others have been doing toward
a reoonetruction program, and I have read the memonrandum
lahmitted to the various governments with a groat deal of
interest and-hearty approval. You have, of course, learned
that it received the signatures of some of the root imrortast
men in the United States, and I should have been delighted
to sign it myself had not my relations with our treasury
departr,ent been of such an intimate character that I feared
the popaibliity of its being misunderstood and er_usin7 emf
barrasement, which would, of ecuToes have done harm rather
than help the effott.

A recent Mail brngs me a full report of the
ooeclusion of the gold account with Germany and I g.ther
that our account with your good institution Is also settled.
Let me take this oprortunity to express to you the groat
al:reoiation which I have; and whicr my aseociated share for
the splendid help which you gave us in handling that matter.
Possibly you have already received a letter from
the bankvith the request that those of your men who had
char7e of this matter receive a statement of our appreciation
and thanks.

I cannot conclude this letter'without Once



Dr. G. VioserinA


Amsterdar Holland

thanking yogi for the splendid time which you gave me during
my visit with you last summer.
If posnible
shall make another short visit to Holland on my way home
fron the Ortint, advioing you well in advance.

With warmest regards and again with many thanks,
I am

Sincerely yours,


AMSTEDAM, 21st December 1920.


Benjamin Strong, Esq.,

c/o The Bank of England

Dear Mr. Strong,

I have received your cable informing us that you
could arrange to spend one or two days in Amsterdam before your departlre to the States. I need not tell you that we highly appreciate your kind intention and that we should be delighted to see you
here. On the other hand I fully realize that your time must be very
limited and that this trip might be rather inconvenient to you.
If this should really be the case, I would kindly ask you
to frankly tell us so and to postpone your visit until a more favourable occasion presents itself, the more so, since, at least as
far as we are concerned, no questionsof importance have to be particularly discussed at present.

If however you prefer to carry out your plan all the same
you will of course be heartily welcome and in that case the 29th December would be the most converient day for us to receive you.
With kindest regards and best wishes of the season,

Very sincerely yours,





Charges 1

This form must accompany any inquiry made

to pay


respecting this Telegram.



Office of Origin, Foreign Number, No. of Words, Date, Time handed in, and Service Instructions.




l )tile


from f


No. of Telegram


50 319 100




















No. of Telegram

I his form must accom-

pany any inquiry made
respecting this Telegram.

Office of Origin, Foreign Number, No. of Words, Date, Time handed in, and Service Instructions.


8087. 54


11.45 M

here at










23n December 1920.

don Ire(ddent







-!.)111-.Di.P.D THIS TRIP NOT


INCr rrIn T..-17T TO Y^T.1 STOP T."'




1 HAW: AT I;RE3f.:1T 110


YOU C.:01172. YOST coliw.2alor




Hotel de l'Europe,
Amsterdam, August 11, 1926.


This will authorize you to claim any registered mail coming for
me in your care from the pootoffice department, and to sign the receipt for
any such mail for me.
Very truly yours,

De Nederlandsdhe Bank,


Hotel de l'Xurope,
Amsterdam, August 11, 1926.


Enclosed is a letter authorizing you to claim any registered
mail which may come to me addressed in care of the Nederlandsdho Bank.
I am now writing to ask if you will forward telegramo received
by you for me, until and including next Monday, to:
0/o Hotel Grand et Euler
Basle, Switzerland
and any mail which may come for me to the same address, until and including
Saturday of this week.

Mail received subsequent to Saturday can be forwarded

to me in care of Messrs. Morgan, Harjes & Company, 14 Place Vendome, Paris,
unless I telegraph you otherwise in the meantime.

This will also apply to some photographs which Dr. Vissering is good
enough to send me Shortly.

Thanking you for all the trouble you have taken in connection with my
correspondence, I beg to remain
Very sincerely yours,

Do Ne6orlandoChe Bank,







August 18, 1927.

My dear Dr. Viseerin:
for Europe
My friend, Mr. Garrard B. in ton, is w fling
I 17.!-sve taken the lib,,,,rty of ,
in b. fevi days, tii11 be in teinEterdors,

flea/ring bin that yo
Netherlands Dank.

You w

:;.ec:ret,-..ry of noIr T

wesociate of mine.

Sterling, llo LIT


fe.ct Mr. dnErton i

the Preeictent of t

I hav

hardly sec.,.med n..c

Dr. G. ViEsering,
President. deNede










he Currency Question as Viewed
by a Foreign Banker
By Mr. I. deBruyn, of the firm of
Amsterdam, Holland
Messrs. Adolph Boissevain & Co., Bankers

We take a real interest in the banking
and currency question in the United

States, because we regret that a great
country, like yours, should be so badly
equipped in this respect, also believing that

a change for the better will intensively
industry and the money-

affect trade,

Of course, the imperfect knowledge of local conditions may hamper us
considerably in giving a sound judgment,

but, as we understand it, the people of
your country do not take kindly to the
private management of a Central Bank,
and, therefore, it is the intention to confer
that authority upon the Treasury Department. Stating it otherwise, they propose
a Central Bank owned by the local banks
and controlled and governed by the United
States authorities at Washington.
Twenty years ago the writer spent some
years in the East and at that time every-

body agreed that the Chinese were the
most conservative nation of the earth and

that they never would consent to have
their hairtails cut. And now, this wonder


has arrived and conservatism has le

these 400 millions without disturbing
world to any great extent. Does this not
show that everywhere people have become

more openminded, more willing to try
new ideas, more inclined to accept 0provements, not gradually, but at once,
having departed from the old custom of
refusing what was offered them because
it was new.
Therefore, we believe that the innova-

tion of a central bank, being a bank of
rediscount and centralizing the banking

reserves of the country may be safely
established at once. As soon as it works,

its benefactions will be felt and its antagonists will disappear faster than melting snow.
Who should own the capital of a central

bank, and who should be its governors?
Experience tells us that a central bank
must be powerful but independent, in the
first place, independent from the Government because in case of war or internal
disturbances, the first duty of the bank is
to assist trade and industry, as well as the
Government, but not the Government in
the first place. If its capital belongs to
the Government, its reserve power will be
used by and on behalf of the Government
only and its credit will suffer as much as
the nation's defense.

Specially in the case

finance of a nation want a strong central
bank, and not a bank whose reserves are
depleted by the Government and whose
action was never influenced by an inde!Went board of governors whose principal aim was maintaining the credit of the
nation, which is different from the credit
of the Government.

And if the governors are functionaries
of the Government, they cannot refuse to
hold the reserves ready for the Army and
Navy Departments, for they have to obey

Even in years of peace a Government
is unable to run a central bank.
Everywhere central banks have started
as Government establishments and history

shows that their relation to the Governments never had any beneficial influence.

Ministers come and go, the governors
are their inferiors and may be appointed
not because they are first rate bankers or
merchants, they have to obey orders, they
have more regard to the approbation of
their superiors than to the money-market,
and bankers and merchants will decline a
share in the Government because their
atmosphere is not red tape but fresh air.
Moreover, every new Minister may have
ideas of his own which he wants to try,

a policy based on long practiced principl
becomes impossible and consequently mill)

takes follow each other, disturb business
and shake the confidence of the people and
its financial advisers, the bankers. Nothing

so shy as credit, it wants to stay wee
stability reigns, but it is very loath to
enter into volcanic regions.

These reasons count for any country.
As to the United States of America, so
far their Government is not superior

to those of England, Germany, France
or Holland. You have many politicians,
but few statesmen, economic principals
are seldom fully understood, though every
politician has his own ideas about banking,
currency and the Stock Exchange. How

then can one expect that the leaders of
your Treasury Bank will be superior to
their European colleagues.

Your minis-

ters and secretaries are wont to shape
their policies according to what the people
want, while in Europe the Government is
entrusted to men who have ideas of their
own, the result of long years of study and

practice, who teach these ideas to the
people, instead of asking what they can
do to oblige them. Here similar questions
are decided on their merit and no political

party would ever include an economic
measure as the Aldrich-plan or a Treasury

bank in a platform declaration, because


ilhese are things for experts to decide and
not for the common people, who are totally ignorant on such questions. Here
we feel that the people must be led, being
themselves unable to lead, and it will be

same with you in spite of all the
"coquetting" of politicians.
We know that the Democrats and many
Republicans believe in the existence of a
money-trust, of a combination of big bankers, not averse to creating or assisting depressions in order to enrich themselves.
We believe that such men existed in
former times, but that such a conspiracy

at the present time is impossible as it
ought to show its hand quickly. In any
case it will be impossible when a central
bank is established and we refuse to believe

that it is impossible to find in the II. S.
of A., capable, private bankers, public
spirited citizens, who can conduct a central

bank as it ought to be conducted in the
interest of the nation.
In our opinion there is not the slightest

doubt that these bankers can govern a
central bank much better than government officials, who seldom have had sufficient training and seldom have learned to
act on their own initiative, acting quickly

without being unduly harassed by their
own feeling of responsibility.

In 1890, some months before the Barin4
crisis, many financial bills-acceptations o

bankers-began to appear in our country,
being offered for discount on attractive
terms. The president of our central bank,

Mr. N. G. Pierson, at once felt that sc.
unknown danger was near, he refused to
rediscount these bills, and when the crisis
came our country was only slightly hurt,
thanks to his foresight and quick action.
Our present president, having noticed
that real estate owners, being unable to get

their loans at the usual rate of 41/2-5%
from mortgage companies, a consequence
of the higher level of credit, were getting
their credits from small country bankers
who accepted their bills which were thereupon rediscounted with the central bank,

in his last report published a warning,
reminding the public that the facility for
rediscount only belongs to commercial

bills, while real estate long term credit
has to apply directly to the money market,

stating that further assistance would be
refused, thereby readjusting the credit
market. You will share our conviction
that similar practical action cannot be
expected from government officials.

In practice the Central Bank President
has to look out for two things only, viz. -

that only real commercial bills are accepted for rediscount and that the gold

pply is always adequate to allow the suden exportation of a relatively big amount,
should the trade of his country demand it,
without disturbing the home money
market. These duties are not very diffi-

to fulfill for an insider, but an outsider-and a government official never will
be anything else-will always be surprised by a debacle instead of foreseeing
and circumventing it.

A few words about the big European
central banks.
In Germany the Reichsbank is a private
company, but strongly tied to the Government. A few years ago exchanges went

against Germany, the Dutch guilder rate
for 100 Marks i.e. falling to the gold importation rate of 58.70. Still no gold
came from Berlin, as political danger
seemed ahead, so that the Government did
not wish to have the Reichsbank part with

Thereupon the exchange fell
under the gold point, to 58.60 and even
At once the whole commercial
world noticed that German international
credit was impaired. In a fortnight the
Reichsbank had to give the gold and exits gold.

changes rose again, but considerable harm
had been done, for every merchant knew
from that moment that the full gold value
of his bills on Germany could not be relied

No bankers are more capable and intelp
ligent than the French. The Banque de
France is a private institution, governed
privately, but also in this case politics are
not wholly separated from the government
of the bank's affairs. Only a few moI

ago the Bank refused gold to its clients,
thereby shaking the confidence of the
people and encouraging hoarding of
money. Exchanges were not low, no ex-

portation of gold was imminent, only the
political horizon was clouded, war with

Germany became a possibility and the
Bank wanted to support the Government
as much as possible. Who can estimate
the losses suffered by the public caused
by this policy of restraining confidence?
In England the Bank is very independ-

ent, but the Board of Governors is not
composed of bankers, but of merchants.
Very seldom a banker is admitted to that
circle. Of course, it is a good thing that
merchants are admitted to the board, because they often know more about the con-

ditions of the trade and industry than
bankers do, so that their advices should
always enjoy a full hearing, but the action

of the Bank of England is often rightly
criticised because its merchant-governors

are not sufficiently in touch with the
money-market and consequently perceive

late often where and when danger is
ing to appear.


In our country conditions are of the
best. p The Bankindependent, its president and
ate and of the Netherlands is
g rnors are selected by the Queen, acting

on a proposition from the board of directors. Always an experienced banker has
been chosen as President and of the gov-

ernors 3 or 4 are bankers and 1 or 2
Any undue request or pressure from the Government would at once

be met by a decisive refusal, and never
has the bank shown any objection to part-

ing with its gold if the exchanges demanded it. At present the Bank of England and our Bank are the only banks of
issue in the world, who freely supply gold
if the trade requests it. As you know,

these two countries are the only nations
who maintain free-trade.

We take great pride in our Central
Bank, as its organization is much better
than those of Germany, France and England. Being a small country, we often
escape unnoticed, but new countries cannot do better than study our banking laws
and central bank charter and imitate them.

We hope that the foregoing makes it
clear to you why we prefer private management of a central bank to official gov

ernors and that even the private banks mi1lli

issue in Europe have been liable to


takes whenever the Government's interests
were safeguarded above those of the Nation. Though assisting the Government

in its task, a bank of issue is and remes
a commercial bank and cannot follow too

closely the principles of commerce, although making profit not being its principal aim.


4,7t-ti-st/ tt





Cannes, Jan. 22, 1927
Dear Mr. Strong:

It was most kind of you to remember us in ycur New Year wishes.
We hope it will bring you good health and happiness.

We were very sorry to

miss the pleasure of meeting you again when Dr. Vissering asked us to join his
Zuidsrzee party;

if you should happen to come to Holland, please let us know.

We now live at Ysselvliedt, Wezep (Gla) and should be delighted to see you

I presume you are also following with interest and a certain anxiety
the events in China.

They are due to affect us all as does the loss of face

at Hankow.

Who could have believed a few years ago that British marines and
assively when the Union Jack was hauled down

ss to understand the attitude of the Chinese

g the foreign devils out or will Christianity

Dr. Mott (?) told me there had never been

ers in China as there was today.

ss Stirm (?).
Yours very sincerely, --

What does

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Biltmore :crest,

Biltmore, :4C., February U, 192V.
My dear Count:
You are very good indeed to Lna.
Tear's wishes.

hoe are not intended

au ackneeledgment of flow

eive you

sense cf responsibil-

ity as to en acknowledgmenL, but rather more to ma:le cure that you and

Countess Otirum ut least once a year are reminded of the visitor who found
such great pleasure in ciecting you in Java and who has ever since been

grateful for your wonderful hcepitality to him.
I wars indeed greatly disappointed to miss seeing you when I ':pas in

Holland lent Sumecr.

Since then, Dr. Vieweria6 has married and he is now

premising to make us a visit in this country, probably next month.

Since my

return in September, I am Sorry to say that I have had a very desperate illness.

I was emiLten with pneumonia almost ime,ediately after arriving, and it

almost finished me.
Bank in April.

I am now here :couperating, and hope to be lack at the

But I shall still look forward to a trip to iurope this Sum-

mer, and tf you are at home then I may be able to have the pleasure of seeing
you again.

Your anxiety as to what is developiag in China is no greater than
my own.

This restlessness which has manifested itself in Africa, in India,

in the Near East, and now in China and, for a time, in Java, is certainly a
manifestation of some development in the Oriental mind of which we Westerners
have only too little comprehension.

The idea of a Communist uprising in

Java would strike one as almost comic, had it not also these more serious
end deplorable aspects.

The explanation may be that the dominant races,

after hundreds of years of exploitation of &stern peoples, are now paying


Count Van Liwburg Stirum.



the penalty for the lack of understanding of the Crientel wind during all
of the long poriod when selfish exploitation was tne cowwon rule.


that that period is past and more genarus ideas prevnil, the Lraditions
and the long wamoriee of the Lust snow thewuelves in ;:he outburst, of this

latent resentment.

It seeLis kb though Kipling were right aster 411:

Zon't you pardon this dictated letter, which ie just now all that
I UM able to accowpliah.

With kindest regards to Countess Stirum and my best withes to your
gooduelf, I can

Sincerely yours,

Count Van Limburg Stirum,
o/o Dr. G. Viseering,
De Naderlunducha

Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102