One notable development following the outbreak of war was the breakdown of the foreign Exchanges. This meant that while it lasted oversea commerce was paralysed. In New York, owing to the large sales of American securities in Europe, sterling exchange rose at first to the extraordinarily high level of $6, and Sir George Paish was deputed to proceed to the United States to discuss measures to relieve the situation. Cargoes of grain and other produce were not bought, and consequently there was almost a complete cessation of chartering. Gradually the position was righted, and early in September business was being done in a quiet way. From then freights, which had been abnormally low during the summer, began to rise and continued to do so. The rise was, in the main, due to a lack of tonnage in certain routes. The short supply was caused by the acquisition of many hundreds of vessels by the Government for various purposes; the inability of the German mercantile marine to take any share in the world's carrying trade; and the loss of a certain number of British ships sunk by the enemy's vessels or through striking mines. Towards the end of the year the position was very seriously aggravated by congestion at British and continental ports. The enlistment of large numbers of skilled dock labourers in the Army, the reservation of certain ports and docks for military requirements, and the accommodation necessary for the Government's large purchases of sugar, all combined to make the position difficult. Ships were kept for long periods waiting their turn to discharge, and it was not uncommon for vessels to be in port three or four times as long as usual. These delays undoubtedly detracted somewhat from the extraordinarily high rates which were being secured. The most striking rate was perhaps that of the carriage of grain from Argentina. As compared with a rate of 12_s._ 6_d._ per ton quoted just before the war, 50_s._ was paid by the end of the year, and this figure was far short of the prices that have since been paid. The rate for coal from Newcastle to London which had been as low as 2_s._ 6_d._ rose to about 13_s._ 6_d._ As some relief for the situation, the Admiralty made arrangements to put a considerable number of enemy steamers which had been detained in this country at the outbreak of war into the coal trade. These vessels, as soon as crews could be found for them, were placed on the market, and did not have any effect in reducing the high rates. A few enemy steamers which had been captured at sea by British warships were sold by auction as prizes. Sums which were considered abnormally high were bid for them, but it is reasoned that while freights continue on the level current at the beginning of this year they should prove satisfactory acquisitions to their owners.