The failure of the German government to meet its foreign commitments whose largest item is an approximate annual sum due American investors amounting to tens of millions of dollars, was accredited to the fact that the Nazi powers are spending vast outlays on “non-productive purposes”, according to Max Winkler, head of the American Council of Foreign Bondholders, in a statement he issued Saturday.
These purposes include military expenditures for the mobilization of an army, nightly parades, torchlight processions, festivals, marches and displays arranged by the rulers of the Third Reich.
The charges made recently by the head of the Reichsbank that the defaulted payments are due to Germany’s poverty, an obvious blow at international anti-German boycott activities, were exploded by Mr. Winkler, who said that the “defaults have been legalized.”
Mr. Winkler’s statement follows:
“Dr. Hjalmar Schacht, in a recent speech at Basle, attempted to shift the blame where it does not belong. The man who today is charged with guiding the financial destinies of the German people is either completely ignorant of, or refuses to accept as accurate, such statistics as emanate from government-controlled bureaus to the effect that impressive gains have been registered in practically every phase of Germany’s economy. Furthermore, since Hitler, prior to his advent to power, had repeatedly threatened to suspend payment of foreign debts, is it not reasonable to assume that Schacht is merely carrying out the wishes of his superior?
“These American holders would like to submit to Dr. Schacht the following questions:
“1. How can one reconcile Germany’s plea of poverty and inability to meet payments abroad on the grounds of a declining foreign trade, when Germany’s export surplus, according to official statistics, has been registering impressive gains, the monthly average for the period January to November aggregating well over RM 56,500,000? Although November showed an appreciable drop compared with October, it should be remembered that October figures were particularly favorable, being the best for any month since April, 1932.
“2. How can one reconcile Germany’s refusal to meet interest on dollar bonds, when Germany’s currency is quoted at a premium of about 40 percent of parity in terms of dollars, which means that German requirements in connection with meeting the service on engagements
The Archive of the Jewish Telegraphic Agency includes articles published from 1923 to 2008. Archive stories reflect the journalistic standards and practices of the time they were published.
