COMPETITIVE CONDITIONS IN INTERNATIONAL TRADE. 51

Besides the matter of exchange, direct banking connections are of
rzlue in financing foreign transactions during the considerable time
they necessarily consume, facilitating transfers of ownership by
means of documents, and eliminating to a considerable degree the
slement of personal responsibility, by reducing the terms of payment
 substantially to cash on delivery of goods. By way of illustration,
 take the following passage from Dr. J. Riesser’s book, The
German Great Banks:
However, the most prominent function of the branches of the German
 banks at Flamburg, Bremen, and London, also of the over-sea
banks, is the financing of imports from over-sea countries, especially
&gt;f raw materials.
This is done in the following manner: The domestic buyer of the
article (importer) procures in the first place from his German bank a
«draft? credit (Trassierungskredit) in the form of “rembours”
credit up to approximately the amount of the invoice in favor of the
over-sea seller of the article (wool, cotton, grain, rice, coffee, ore,
ete.), with the understanding that the seller, or the latter’s bank,
¢hall have authority to draw upon the bank of the importer to the
extent of the purchase price. The bank will accept the foreign bill,
which the over-sea seller or his bank will send to it after the loading
of the goods, or have presented to it for acceptance by a German
banking connection, only in case a full set of the bills of lading together
 with insurance policy, invoice, description of weight, and
quantity, and, if need be, the certificates of origin are turned over
to it. In this way the delivery of the goods to the bank 1s assured,
as are also the identity of the article and the terms of the sale, as described
 by the importer, as well as the fact that the particular transaction
 is a real, bona fide commercial transaction, corresponding to
‘he importer’s statement.’
The Germans have set great value on foreign banking connections
of their own, and have made the establishment of such connections
an important part of their campaign for foreign trade. The advantages
 they have derived therefrom were summarized in part as follows,
 in 1912, by Archibald J. Wolfe, a commercial agent of the
United States Department of Commerce and Labor 2
The German banks maintaining branches and connections oversea
play an important part in the furtherance of the German export
trade by enabling foreign customers to provide for the financing of
their shipments from Germany and by the moral force of being on
the spot and in close touch with the local trade conditions. * * *
The participation of German banks in the development of many
foreign industrial, railway, and mining enterprises provides outlets
for German exports.

13. Riesser, The German Great Banks and their Concentration, pp. 428, 429, translation
»ublished by the National Monetary Commission, 61st Cong.. 2d sess.. 8. Doc. 593.
2 Welfe. op. cit., p. 43.