ith ample
collateral. These bonds have a ready market, an important detail that
the investor must not overlook in purchasing foreign securities.

Now turn to the borrowings of France in the United States. With this
great nation, whose middle name is Thrift, Uncle Sam was no respecter of
past performance. For the one separate French external loan he exacted
his pound of collateral. As a matter of fact it amounted to nearly a
ton.

I refer to the issue of $100,000,000 Three Year Five Per Cent Gold Notes
bearing the date of August 1, 1916. To float this loan the American
Foreign Securities Company was formed which arranged to lend the French
Government $100,000,000. As security the Company--it was merely a group
of American bankers, required France to deposit stocks and bonds having
a value at prevailing market and exchange rate of $120,000,000. Should
the value of these securities fall below this sum they must be
replenished until there is a margin of twenty per cent in excess of the
principal of the loan.

These securities throw an interesting sidelight upon the resource of the
French Republic and its ability to borrow desirable collateral from
patriotic citizens. They include obligations of the Government of
Argentine, Sweden, Norway, Denmark, Switzerland, Holland, Uruguay,
Egypt, Brazil, Spain, and Quebec. The most picturesque parcel in the lot
is $11,000,000 in Suez Canal shares. This stock is one of the corporate
heirlooms of France and is very closely held. It not only pays a large
dividend but shares in the profits of the company which in peace times
are big. The fact that France should put these prize securities in
"hock" is evidence of her determination to keep her credit absolutely
above reproach.

The Three Year French Notes were brought out at 98 and interest and at
the time of issue yielded about 5.73 per cent.

But all direct French borrowing in America has not been on the pound of
flesh basis. For now we come to what might well be called The Loan of
Sentiment. It is the $50,000,000 City of Paris Five Year Six Per Cent
Gold Bond Issue dated October 15, 1916. It gave Americans the
opportunity to pay a substantial tribute of affectionate gratitude for
happy hours spent in the Queen City of Europe and have the prospect of a
desirable dividend at the same time. Here is a piece of foreign
financing with a distinction and a background all its own. Aside from
its purely sentimental phase it is perhaps the onl