Notwithstanding her great resources, France would not be in a condition to pay abroad two milliards a year without ruining her exchange, which would drop at once to the level of Germany's. Italy with difficulty could pay one milliard. France and Italy are honest countries, yet they cannot pay their war creditors, and have not been able, and are not able, to pay any share of their debt either to the United States of America or to Great Britain. As a matter of fact, up till now they have paid nothing, and the interest continues to accumulate with the capital. Why have neither France nor Italy yet started to pay some of their debt? Having won the War, France has had all she could have--fertile territories, new colonies, an abundance of raw material, and above all iron and potash. The simple explanation is that which I have given above. Can, then, Germany, who is in a terrible condition, whose circulation promises ruin, who has no longer credits nor organization abroad, who has a great shortage in raw materials; can Germany pay four or five milliards a year? We must also remember that Germany, in addition to the indemnity, must pay the cost of the Army of Occupation, which up to now has amounted to twenty-five milliards of paper marks a year, or more than 1,600 millions of francs at par. That is, Germany has to bear for the support of the Allied troops a charge equal to the cost of maintaining the armies of France, Italy and Belgium before the War. No financier seriously believes that the issue of bonds authorized by the treaty for the credit of the Reparations Commission has now any probability of success. Germany's monetary circulation system is falling to the stage of _assignats_, and the time is not distant when, if intelligent provision is not made, Germany will not be in a position to pay any indemnity. Obliged to pay only one milliard of gold marks, Germany has not been able to find this modest sum (modest, that is, in comparison with all the dreams about the indemnity) without contracting new foreign debts and increasing her already enormous paper circulation. Each new indemnity payment, each new debt incurred, will only place Germany in the position of being unable to make payments abroad. Many capitalists, even in Italy, inspire their Press to state that Germany derives an advantage from the depreciation of her mark, or, in other words, is content with its low level. But the high exchanges (and in the case of Germany it amounts to ruin) render almost impossible the purchase of raw materials, of which Germany has need. With what means must she carry out her payments if she is obliged to cede a large part of her customs receipts, that is of her best form of monetary value, and if she has no longer either credits or freights abroad?