310 
INTERNATIONAL TRADE 
were found in the time-honored and inevitable resort of the hard- 
pressed — borrowing. 
The first great loan operation came in September, 1915, when the 
Anglo-French loan of $500,000,000 was placed on the American 
market. Like other subsequent borrowings of the two govern- 
ments, it was managed by the firm of J. P. Morgan & Co. Thruout 
the war, and indeed for the period after the war, that firm acted as 
financial agents not only for them, but for their European allies 
also. Its first operation, the “Africs” ! loan of 1915, was simple 
enough. Government bonds, the joint and several obligations 
of Great Britain and France, having five years to run, were sold 
to Americans; being taken by banks and investment concerns, 
not without some pressure from the great house itself, and in 
course of time distributed among investors. The proceeds were 
used by the Morgans in order to pay for the American goods which 
had been or were to be bought by the two governments. The 
foreign purchasers, be it noted, were in the main not private per- 
sons, but the warring powers themselves. They bought not only 
war supplies of all kinds, but food and other necessaries for their 
civilians. Characteristic of purchases of the latter kind were 
those of wheat and flour, bought by the governments and then sold 
to their own population at a lower price than had been paid, 
lest a stir of unrest be aroused by the high price of bread. Not 
all the exports from the United States were accounted for by the 
various kinds of government buying; but it was these which 
played by far the largest part. 
Other loans followed, and, as the war went on and spread over 
all the world, in such volume that the credit of the borrowers was 
strained to the utmost. Soon it became necessary to resort to less 
simple methods, and to attach to the loans which were placed in 
the American market something more than the bare obligations 
of the several governments. Secured loans were offered. Stocks 
and bonds of American railways and other enterprises, held in 
Europe in consequence of the long series of loans made in previous 
years by foreign investors to Americans, were now sent back to the 
1A. Fr.” was the stock market abbreviation, commonly pronounced ‘‘ Afric.”