EXTRACTS FROM DIE BANK [1] (original) (raw)

Vladimir Ilyich Lenin

NOTEBOOK “β”

(“BETA”)

EXTRACTS FROM DIE BANK [1]

Die Bank. A Monthly Journal of Finance and Banking
(Publisher: Alfred Lansburgh), 1914, 2nd (half-year),
p. 1042.

Imports and exports in million pounds sterling, from data of the Board of Trade (London):

| | (First) _Half_-Year | | | | | | | | ------------------------- | ------------------------------------------- | ----- | --------- | --------- | ----- | ----- | | ( | [1]*7 months 1/I-1/VIII | ) | Imports | Exports | | | | 1912 | 1913 | 1914 | 1912 | 1913 | 1914 | | | | | | | | | | | | Great Britain . . . . . | 296.1 | 319.7 | 375.9 | 225.3 | 257.1 | 255.4 | | Germany . . . . . . . | 260.6 | 260.0 | 369.3 | 205.4 | 243.1 | 249.2 | | U.S.A*. . . . . . . . . | 215.3 | 212.2 | 337.7 | 255.6 | 271.8 | 245.7 | | France* . . . . . . . . | 192.2 | 196.4 | 198.6 | 149.0 | 156.4 | 153.8 |

| (Ibidem, p. 713). Note on “_Banks andthe Post Office_”. The boundary betweenthe banks and the savings banks “isbeing increasingly obliterated”. Hence complaints by the banks. The Erfurt Chamber of Commerce speaks infavour of the banks against the “recentintervention of the post office in cur-rency circulation” (in the form of the“issue of postal letters of credit”). Theeditors remark that postal letters ofcredit operate only within the GermanEmpire, whereas bank letters of creditserve mainly persons going abroad, and“after all, the public exists not onlyfor the sake of the banks” (714). | | | | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | --------------------------------- | | | | | banks andthepost office | | | | | | | | | this “not only”is magnificent!!!) |

From the article “Thoughts on the Thousand Million Loan”, p. 932: “A subscriber to the loan possesses liquid assets, but mostly in the form not of cash, but of a bank account or a savings bank, association, etc. deposit. In Germany these institutions control, in round figures, 35,000 million marks of such liquid assets, about half of which are at the immediate disposal of their owners, while the other half are available to them after preliminary notification—mostly after a month” (933).

What is involved is the transfer of ownership from private persons’ accounts to the state’s account (and vice versa in paying suppliers, etc.).

The credit institutions as a whole dispose of “not more than 500 million marks”, on the basis of “their total cash and deposits in the State Bank” (933).

In 1871, France paid 5,000 million in such a way that only 742.3 million was paid in gold, silver and banknotes, the remainder (4,248.3 million) being in bills. (France recovered so rapidly in 1870-71 because she did not tamper with her currency and made no excessive issue of “uncovered banknotes”.)

p. 903 et seq.: “_The Ousting of London as the World’s Clearing House_” by Alfred Lansburgh.

A very good article, explaining the causes of Britain’s power. The chief cause: “the absolute predominance of British trade and currency circulation over the trade of all other countries” (909). It exceeds German trade “by 50 per cent in round figures” (ibidem). In addition, there is the trade with the colonies!!

| N.B. | | | “_Britain accounts for three-quarters ofworld trade_” (910). | | ---- | | | ---------------------------------------------------------------- |

“This means that three-quarters of all international payments pass directly or indirectly through Great Britain” (910).

“Sterling accounts” “predominate” also in Japan, China, Chile, Peru, South Persia, “the greater part of Turkey (910).—“Knowledge of English is widespread in commercial circles” (910).

Furthermore, Britain finances this trade of the whole world (the lowest rate of interest; the most stable gold currency; one pound sterling = 7 1/3 grams of gold, etc., etc.).

Great Britain’s “vast” monetary resources, her 60 colonial banks (911), etc., etc.

The maxim of a bank director (the Bank of Brazil), Kämmerer(a German):

| (913) “The first essential for opening an overseasbanking establishment is credit, an accepting bankerin London.” | | | N.B.! | | ----------------------------------------------------------------------------------------------------------------- | | | ----- |

| | | | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | | | p. 912, note: “Regarding the difficulties encounteredby German overseas banks in introducing bills of exchangein marks in South America, cf. Jaffé, British Banks,second edition, 98-101, Frankfurter Zeitung, August 29,1914; Hamburger Nachrichten, September 15, 1914” (I omitother quotations). | | | |

“For every country adopting a currency based on gold and holding, as occurs almost everywhere, a large portfolio of British bills of exchange in place of gold, not only subordinates a greater part of its international payments to the London Clearing House, but thereby also immediately assists the consolidation of British world financial power. The continual holding of a large portfolio of British bills of exchange means, in practice, that the country in question puts considerable resources at London’s disposal, which for its part London can, and does, use to further finance the foreign trade of other countries and in this way strength en its own sterling currency and its own clearing function. Thus, owing to the gold value of the pound sterling, Great Britain is always able to put at the service of her credit system, besides her own large capital assets, also several thousand million marks of foreign money” (913-14).

To deprive Britain of this role requires “huge financial resources and a low rate of interest” (916)... “And one must be in a position not only to pay out vast sums of money, but also to guarantee the absolute stability of the currency that is to replace the British, that is, one must be prepared at any time to pay in gold.”

Hence, the term “utopian” is applied to the plan of the National City Bank (Morgan’s Bank)[16] or the Swiss banks, “which believe that a little good will is quite sufficient to wrest from London the international clearing accounts, or a considerable part of them. That is indeed a highly desirable aim, but it cannot be achieved until some other country can put at the service of world trade the amount of credit, the complex of commercial, banking and interest advantages, and the reliable currency foundation, which, prior to the outbreak of the war at least, Britain put at the disposal of world trade” (920)....

(1914, November and December.) “The Covering
of War Costs and Its Sources”, an article by Alfred Lansburgh.

Quotes Lloyd George as saying (in September 1914): “In my judgement, the last few hundred millions may win this war. This is my opinion. The first hundred millions our enemies can stand just as well as we can, but the last they cannot, thank God...” (p. 998).

Says Lloyd George is mistaken. There are four sources for covering war costs: (1) “First degree” reserves = cash (France and Russia have more than Germany, but Britain less. Here Germany is weaker). (2) “Second degree” reserves: short-term debt claims in world trade (Britain is much stronger: “Whereas Britain is the world’s banker and keeps her money liquid, France is the world’s financier and invests her money”) (1001). (3) Net income from the country’s production + (4) part of gross income devoted to depreciation (or accumulation). Here, he says, we are not weaker.

In this connection, however, Lansburgh is counting on exports which though secret (“hidden”), will not disappear.

Our (Germany’s) low discount rate proves (December 1914!!!), he says, that exports are inadequate, do not correspond to “our expenditure abroad” (1103).

| N.B. | | | Cf. p. 1112: “Only when exports suffice fully tocover imports and war expenditure abroad will thenational economy be really on a war footing.” | | ---- | | | ---------------------------------------------------------------------------------------------------------------------------------------------- |

1914, 1 (May). “The Bank with 300 Million”, an article by
A. Lansburgh.

The Discontogesellschaft swallowed up the Schaaffhausenscher Bankverein and increased its share capital to 300 million marks (p. 415).[2]

“Thus for the first time a really big German bank has become a victim of the concentration process” (415).

The Deutsche Bank increased its capital to 250,000,000 marks. The Discontogesellschaft replied to this by a “merger” with the Schaaffhausenscher Bankverein and increased its capital to 300,000,000.[3]

“With a capital of 300,000,000 marks, it becomes, for the time being, the biggest bank not only in Germany, but in the world” (422).

The “struggle for hegemony”, which had seemed decided in favour of the Deutsche Bank, now flared up afresh:

| | | “Other banks will follow this same path ... andthe three hundred men, who today govern Germanyeconomically, will gradually be reduced to fifty,twenty-five, or still fewer. It cannot be expected thatthis latest move towards concentration will be con-fined to banking. The close relations that exist betweenindividual banks naturally lead to the bringingtogether of the industrial syndicates these banksfavour. This, and business fluctuations, will lead tostill more mergers, and one fine morning we shallwake up in surprise to see nothing but trusts beforeour eyes, and to find ourselves faced with the necessityof substituting state monopolies for private monopolies.However, we have nothing to reproach ourselveswith, except that we have allowed things to followtheir own course, slightly accelerated by the manipula-tion of _stocks_” (426).[4] (End of article.) | | | | | N.B. | | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | | | | ---- | ---- | | | | | | | | | | | | | | | | N.B. | | | | | | | | | | | | | | | | | | |

“SUBSIDIARY COMPANIES”, an article by Ludwig Eschwege, p. 544 et seq. (May 1914).

Early in 1912, the big banks (yielding to the pressure of the State Bank) introduced a new type of balance-sheet. But thousands of joint-stock companies continue to publish brief (“knappe”) balance-sheets, not going beyond the requirements of the law—the brevity of the balance-sheet being alleged to be a guarantee against speculation!!! In fact, however:

| | “In reality, what is achieved by this [the “brevityof balance-sheet”] is merely that a few better-informedpersons are able to enrich themselves at the expense of themass of shareholders, especially if brevity is combinedwith a subtle system of misleading headings to makeimportant data invisible to the ordinary shareholder.This gives the directors and their good friends a doubleadvantage: being sole possessors of all information, theycan benefit from a rise in market values in favourablesituations, and escape anticipated losses by a timely saleof shares in unfavourable ones. | | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | | | | | | |

| goodexample! | | | “Thus, for example, the Spring-Steel Com-pany of Kassel was regarded some years agoas being one of the most profitable enterprisesin Germany. Through bad management itsdividends fell in a few years from 15 percent to nil. It appears that the Board, withoutconsulting the shareholders, had loaned sixmillion marks to one of its ‘subsidiary com-panies’, the Hassia Company, which hada nominal capital of only some hundreds ofthousands of marks. This commitment, amount-ing to nearly treble the capital of the ‘parentcompany’, was never mentioned in its balance-sheet; this omission was quite legal andcould be hushed up for two whole yearsbecause it did not violate any point of com-pany law. The chairman of the SupervisoryBoard, who as the responsible head hadsigned the false balance-sheets, was, andstill is, the president of the Kassel Chamberof Commerce. The shareholders learned ofthe Hassia loan only much later, after it hadbeen proved to be a mistake and when Spring-Steel shares dropped nearly 100 per cent,because those in the know were getting ridof them. It was only then that the item inquestion was made evident by a change inthe method of drawing up the balance-sheet.This typical example of balance-sheet juggle-ry, quite common in joint-stock companies,explains why their Boards of Directors arewilling to undertake risky transactions witha far lighter heart than individual business-men. Modern methods of drawing up balance-sheets not only make it possible to concealthe risky deal from the ordinary shareholder,but also allow the main interested partiesto escape the consequence of an unsuccessfulexperiment, by selling their shares in time,whereas the individual businessman riskshis own skin in everything he does” (545).... | | ------------ | | | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | | | | | !!! | | | | | | | | | | | | | | N.B. | | | | | | | | | | | |

| | | | | ------------------------------------------------------------------------------------------------------------------------ | | - | | | A palimpsest is a parchment from which the originalinscription has been erased and then another inscrip-tion imposed. | | ⋕ | | | | |

| ...“The simplest and, therefore, most common proce-dure for making balance-sheets indecipherable is todivide a single business into several parts by setting up orattaching ‘subsidiary companies’. The advantages ofthis system for various purposes—legal and illegal—are so evident that today big companies which do notemploy it are quite the exception”[5] (545-46). | | | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | | | |

This assures “a certain impenetrability of their operations” (ibidem)....

An outstanding example is the Allgemeine Elektrizitäts Gesellschaft (with thousands of millions of marks in subsidiary companies)....

| | | Author’s italics: “Subsidiary companies are an idealmeans for compiling objectively false balance-sheetswithout contravening the provisions of company law”(549). | | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------- |

“The decisive factor is that the modern system of arranging balance-sheet items makes concealment possible” (ibidem)....

Another example:

The Oberschlesische Eisenindustrie Aktiengesellschaft (pp. 550-51) has in its balance-sheet “holdings” = 5,200,000 marks.

What holdings? The author ascertained privately: 60 per cent are shares of the Gleiwitzer Steinkohlengruben
(and this company has debts of 20,000,000 marks!!)

((End))

Ibidem p. 340 (April) (Berlin big banks, February 28, 1914).
Balance-sheets of Berlin big banks.

Savings banks (1910) (including post office savings banks)[17] (p. 446)

| | Millionmarks | | | Millionmarks | | --------------- | ------ | ----------- | ------------ | | Germany | 16,780 | Denmark | 603 | | Austria | 5,333 | Luxemburg | 49 | | Hungary | 1,870 | Sweden | 961 | | Italy | 3,378 | Norway | 570 | | France | 4,488 | Spain | 340 | | Great Britain | 4,518 | Rumania | 50 | | Russia | 3,019 | Bulgaria | 36 | | Finland | 190 | U.S.A. | 17,087 | | Switzerland | 1,272 | Australia | 1,213 | | Holland | 464 | New Zealand | 319 | | Belgium | 830 | Japan | 662 |

p. 496: Criticism of “statistics of issues”:

| ⎛⎝ | for the most part these statistics (in the FrankfurterZeitung and Deutsche Oekonomist they are largelyestimates) are very inexact, giving a maximum andnot the reality. The issue of shares can be the transfer of debt into a different form. | | | N.B. | | ------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | ---- |

| ⎧⎪⎨⎪⎩ | Cf. Dr. Hermann Kleiner, Statistics of Issues in Germany, Berlin, 1914.and M. Marx (Thesis), Statistics of Issues in Germany and Some Foreign States, Altenburg, 1913. | | | N.B. | | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | ---- |

1914. 1, p. 316 (article by Lansburgh). “The Stock Exchange _versus the Banks_”:

| ...“The Stock Exchange has long ceased to be theindispensable medium of circulation that it wasformerly, when the banks were not yet able to placethe bulk of new issues with their clients.”[6] | | | | N.B. | | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | | ---- | | | | | | | |

| (March 1914) pp. 298-99, “_new era of con-centration_” (in banking)—in connection withdeteriorating business situation, etc. | | | ---------------------------------------------------------------------------------------------------------------------------- | | | | | |

(“The Bergisch-Märkische Bank, this 80-million Rhenish enterprise with its 35 branches, will soon be merged in the Deutsche Bank”: 298).

“For while merger does not always give strength, it nevertheless conceals from outside many weaknesses and sores” (299)—on the significance of mergers....

p. 94. “Bankruptcy statistics[18]—their significance for an appraisal of the business situation.

| | (From Quarterly Reviews of Statistics of the GermanReich) especially “the most serious economic crashes,i.e., cases where, owing to the lack of assets, liquida-tion proceedings either cannot be begun at all orhave to be suspended” (p. 94). | | | | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | | N.B. | | | | | | |

[See the table on p. 87.—Ed.]

During this period the number of large towns has increased from 28 to 48 (and their population still more), but the percentage of very big bankruptcies (completed owing to lack of assets) was previously lower than the average, but is now higher.

p. 1 (January 1914), from an article (“Causes of Crises”) by Lansburgh: (N.B. Business situation).

| ergo from1913 | | | | | “For about a year now, the German busi-ness situation has been noticeably dete-riorating.” | | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | | | ------------------------------------------------------------------------------------------------------ | | crisis from1914 | | | | | “The period we are passing through revealsmany, though not all, characteristic featuresof a crisis”... | | | “The most fatal cause of crises ... is prog-ress” ...(11). | | | | | | | | Counter-measures? “More effective (thana cartel) is a trust, which either deliberatelysuppresses all inventions and improvements,or buys them up, as was done, for example,by the big German glass factories in respectof Owens’s bottle-working patent, which unit-ed into a sort of special-purpose trust to buywhat appeared to them an exceedingly dan-gerous invention” (p. 15).[7] | | | | | | | N.B.goodexample!! | | | | | | | | | | | | |

| My additions | | | Total in the German Reich | No. of bankruptcies in large towns | | | | | | | | | | | | | | | | | | | | | | | -------------------------------- | -------- | --------- | ------------------------- | ---------------------------------- | ----- | ------- | ----- | ----- | ----- | -------------------- | ----- | ------- | --- | --- | ----- | | ------------------- | | ------- | | ----- | | -------------------- | | ------- | | | | Declared | Completed | Declared | Completed | | | | | | | | | | | | | | | | | | | | | | | | | | Total | | OfwhichNo.reject-ed | | Percent | | Total | | Owingto lackofassets | | Percent | | | Total | | OfwhichNo.reject-ed | | Percent | | Total | | Owingto lackofassets | | Percent | | | | | | | | | | | | | | | | | | | | | | | | | | | | | accordingto Reiser | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Start of boom | 1895 | 7,111 | 680 | 9.6 | 6,362 | 395 | 6.2 | 1,823 | 243 | 13.3 | 1,724 | 104 | 6.0 | | | | | | | | | | | | | | | 1897 | 6,997 | 639 | 9.1 | 6,077 | 381 | 6.3 | 1,777 | 251 | 14.1 | 1,466 | 92 | 6.3 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Business situa-tion good | 1899 | 7,742 | | 8.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Crisis | 1901 | 10,569 | | 10.9 | | | | | | | | | | | | | | | | | | | | | | | | 1903 | 9,627 | | 15.1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Revival | 1905 | 9,357 | | 17.6 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | American crisis | 1907 | 9,855 | | 17.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1908 | 11,571 | | 19.0 | | | | | | | | | | | | | | | | | | | | | | | | | 1909 | 11,005 | | 21.6 | | | | | | | | | | | | | | | | | | | | | | | | | 1910 | 10,783 | | 22.2 | | | | | | | | | | | | | | | | | | | | | | | | Prosperity[8] | { | 1911 | 11,031 | 2,351 | 21.3 | 8,092 | 682 | 8.4 | 3,603 | 1,238 | 34.3 | 2,325 | 220 | 9.5 | | | | | | | | | | | | | 1912 | 12,094 | 2,885 | 23.9 | 8,536 | 784 | 9.4 | 4,060 | 1,563 | 38.5 | 2,395 | 241 | 10.1 | | | | | | | | | | | | | |

| goodexample! | | | | “_Transport Trust_”, a note in DieBank, 1914, 1, p. 89.The formation is expected (perhaps in thenear future) of a Berlin “transport trust”, i.e.,an interest-community of the three Berlintransport companies—the elevated railway,tramway, and omnibus companies. We havebeen aware that this plan was contemplatedever since it became known that the majorityof shares in the omnibus company had beenacquired by the other two transport compa-nies.... We may fully believe those who arepursuing this aim when they say that byuniting the transport services they will haveeconomies, part of which will in time benefitthe public. But the question is complicatedby the fact that behind the transport trustthat is being formed are the banks, which,if they desire, can subordinate the means oftransportation, which they have monopolised,to the interests of their real estate business.To be convinced of the reasonableness ofsuch a conjecture, we need only recall thatthe interests of the big bank that encouragedthe formation of the Elevated Railway Com-pany were already involved at the time thecompany was formed. Indeed, the interestsof this transport undertaking were interlockedwith the real estate interests and so an essen-tial prerequisite for the foundation of thetransport company was created. The pointis that the eastern line of this railway wasto run across land which, when it becamecertain that the railway was to be construct-ed, this bank sold at an enormous profitfor itself and some persons associated withit in the land company at the SchönhauserAllee railway station.[9] For it is commonknowledge that land development, and theresultant rise in land prices, is best achievedby means of new transport routes.” (Therefollows yet another example: no less than eleven lines already run to the Tempelhofarea. Too many? The reason: many directorsand members of Supervisory Boards livethere!!! p. 90.)... “A transport monopolyinvolves a real estate monopoly....” | | ------------ | | | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | | | | | | !! | | | | | | | | | | | | N.B. | | | | | | | | | | | | !! | | | | | | | | | | | | | | | | | | | | | | | | | | | | | N.B. | |

“_The Oil Comedy_”, Die Bank, 1913, No. 4 (p. 388).

Excellent note, reveals the essence of the struggle for monopoly of oil in Germany.

| | Before 1907. “Until 1907 the Deutsche Bankoil concern was engaged in a sharp conflictwith the Standard Oil Company” (389).The outcome was clear: defeat of the DeutscheBank. In 1907, two courses were open to it:either liquidate its “oil interests” and losemillions, or submit. It chose the latter andconcluded an agreement with Standard Oil(“not very advantageous” to the DeutscheBank). The Deutsche Bank undertook “notto attempt anything which might injureAmerican interests”, but... the agreementwould cease to operate with legislation estab-lishing a German oil monopoly.And then Herr von Gwinner (a DeutscheBank director), through his (private) secre-tary (Stauss) (Die Bank, 1912, 2, p. 1034),launched a campaign for a state oil monop-oly!! The entire machinery of the big bankwas set in motion... but there was a snag.The government (though it had already draft-ed a bill and put it before the Reichstag)feared that, without Standard Oil, Germa-ny would not be able to obtainoil.See 1913, p. 736 et seq.The war preparations bill (July 3, 1913)came to the rescue—the oil bill had to bepostponed. Standard Oil won, for themonopoly (for the time being) did not even-tuate.[10] | | | | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | -------------------------------------------------------- | | | | | N.B.:Struggleof theDeutscheBankagainstStandardOilCompany | | | | | |

| | | | | | | | --- | | ------------------------------------------------------------------------------------ | | | | N.B | | The struggle of the _Deutsche Bank_and Germany against the Standard Oil Company. | | | | | | | | | |

Die Bank, 1913, No. 8 (August).

Alfred Lansburgh, “Five Years of German Banking”.

Growth of Concentration:

Deposits (of all banks with a capital > one million
marks)

Deposits of the 57 big banks increased by 2,750 million marks.

Increase in 5 years (million marks)

| | Deposits | Capital | Reserves | | | | | | | | ------------- | -------------- | -------- | --- | ----- | ------- | ------ | ---- | ---- | | { | All banks with | > | 1 | mill. | capital | +2,818 | +390 | +148 | | 57 banks with | > | 10 | ” | ” | +2,750 | +435 | +153 | |

The small banks show an absolute decrease: mergers, etc.

Percentage of total deposits (p. 728)

1913, No. 7, p. 628 et seq.

“_The State and Foreign Loans_” (Alfred Lansburgh).

The German government has forbidden foreign loans? What impels the banks towards that policy? The fact that they are already “_bogged_” (Mexico, China, Turkey, etc., threaten to go bankrupt).

What induced the banks to grant loans to such states in the first place? Profit!

| | | | | | | | | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | | ---------------------------------------- | | | | a difference of up to 7-8 per cent betweenthe subscription price and the bank’s price;different conditions, for example, a depos-it—six months’ interest as “guarantee”,etc., etc. | | | | concerningthe ques-tion ofimperia-lism!! | | | | | | | | | |

Then “high politics” (France and Germany especially—grant loans in order to acquire allies, etc.).

Mexico (p. 628) defaulted more than once (without complete bankruptcy), but is granted loans, for otherwise worse is threatened!!

“_Rivalry over Foreign Loans_” (1913, No. 10, p. 1024 et seq. Editorial note).

| | “A comedy worthy of the pen of Aristophanes islately being played on the international capitalmarket. Numerous foreign countries, from Spainto the Balkan states, from Russia to Argentina,Brazil and China, are openly or secretly cominginto the big money markets with demands, some-times very persistent, for loans. The money mar-kets are not very bright at the moment and thepolitical outlook is not promising. But not a sin-gle money market dares to refuse a loan for fearthat its neighbour may forestall it, consent togrant a loan and so secure some reciprocalservice. In these international transactions thecreditor always manages to secure some extrabenefit: a favourable clause in a commercialtreaty, a coaling station, a contract to constructa harbour, a fat concession, or an order for guns...”(1025).[13] | | | | | | | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | | | | | | “bene-fits” | | | | | | | | | | | | | | | N.B. | | | | | | | | | | | | | |

| | | | --------------------------------------------------------------------------------------------------- | | | | the “benefits” of imperialism—important in examiningthe question of monopoly and finance capital | | | | |

1913, August, p. 811, note on “Savings Banks and the Banks”....

...“The keen rivalry between the savings banks and the banks, which flared up some years ago because each of these so dissimilar organisations is endeavouring to go beyond its own field of activity and penetrate that of the other, continues to occupy the attention of our Chambers of Commerce.” The Bochum Chamber of Commerce demands, for example, that measures be taken against the savings banks, including that they be prohibited from discounting bills, dealing with current accounts, etc. (but allowing them “safes”, cheques and endorsement).[14]

Same subject: “Banking Activity of Savings Banks” (p. 1022 et seq.)

| | The savings banks are being turned intoinstitutions for the rich: in Prussia in1909, out of 10,300 million marks of depos-its, 4,780 million 46 1⁄3 per cent con-sisted of deposits > 3,000 marks (15 percent of deposits >10,000 marks). Wealthydepositors often have more than one book.Savings banks engage in risky operations(bills, mortgages, etc.) under the spur ofcompetition (4 or 4 1⁄4 per cent has to bepaid!!). There is a proposal to “ban” this.... | | | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------ | | | | !!they wantto go “back”to smallcapitalism(and nottowardssocialism) |

An article “The Swamp” (L. Eschwege) (1913, p. 952 et seq.) on the swindles of speculators in real estate (plots sold at exorbitant prices, builders going bankrupt, workers not paid and ruined, etc. etc.). Attempts by Haberland, head of the gang, to monopolise the “information bureaus”, i.e., monopolise all building work. The concluding words are typical:

| “Unfortunately, the inevitable course of mod-ern civilisation apparently leads to the econom-ic productive forces falling more and moreinto the hands of powerful individuals who usethem in a monopolistic way. The economic liber-ty guaranteed by the German Constitution hasbecome, in many departments of economic life,a meaningless phrase. Under such circumstances,an incorruptible bureaucracy, conscious of itsresponsibility, is the granite rock that cansave the public good from the encroachingflood of avarice. If this rock should crumble,even the widest political liberty cannot saveus from being converted into a nation of unfreepeople,[15] in which case even the monarchy wouldhave merely a decorative significance” (p. 962). | | | | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | ------------------ | | | | | ha-ha! | | | | | | | | | | only“wouldhave”??? |

| | | | | | | | | | | ---- | | | -------------------------------------------------------------------------- | | | | ---- | | N.B. | | | The author has a book entitled Land andMortgage Problems, 1913 (2 vols.) | | | | N.B. | | | | | | | | | | |

Notes

[1] Figures for the countries marked by an asterisk refer to January-July, the others, January-June.—Ed.

[2] See present edition, Vol. 22, p. 215—Ed.

[3] Ibid.—Ed.

[4] Ibid.—Ed.

[5] See present edition, Vol. 22, pp. 229-30.—Ed.

[6] See present edition, Vol. 22, p. 218.—Ed.

[7] See present edition, Vol. 22, p. 276.—Ed.

[8] Die Bank, 1914, p. 5 (January 1914).—Lenin

[9] See present edition, Vol. 22, pp. 236-37.—Ed.

[10] See present edition, Vol. 22, pp. 249-50.—Ed.

[11] Ibid., p. 211.—Ed.

[12] Ibid., p. 234.—Ed.

[13] See present edition, Vol. 22, p. 244.—Ed.

[14] Ibid., p. 217.—Ed.

[15] Ibid., p. 238.—Ed.

[16] The National City Bank (from 1955 First National City Hank of New York)—United States’ third largest bank and the centre of a financial-monopoly group embracing large industrial and financial corporations. p. 79

[17] All the data refer to 1910 ,except those for Switzerland (1908), and for Hungary and France (1909). p. 85

[18] _Bankruptcy statistics_—statistics of proceedings taken against insolvent debtors. p. 86