Courtesy Reuters

The French Financial Outlook

IN a period that offers a spectacle of constant and dramatic changes, and charges us a good price for the entertainment, France is contributing an original note. The unexpected and almost offhand rapidity with which she is able to recover her balance is a source of unending astonishment to the world.

Last summer an authoritative American critic voiced the fear that France would be unable to balance her budget and save the franc. Well, within a period measured in weeks, we found the French budget balanced, the railroad deficit halved by the stroke of a pen, French government bonds again soaring, gold streaming back into the Bank of France, American eagles and British sovereigns dropping on exchange as a result of decreased hoarding, and industrial securities again finding buyers in the stock markets. Confidence, in a word, had been restored. And it was done by simple, nay classical, procedures.

Much the same thing has happened again in the three months since the events of the Sixth of February. Then many people abroad felt that an era of unrest and bloodshed might be opening in France. But lo! within two days the "Sage of Tourne-feuille," M. Gaston Doumergue, had a national coalition government organized, calm had been restored, and a Chamber that had been upsetting cabinet after cabinet on the financial question was getting ready docilely to authorize the ministry to do by proclamation things that it had been refusing for over two years to do itself.

The matter-of-fact way in which France gets onto her feet after an apparent collapse is somewhat irritating to foreigners who do not grasp the underlying causes of her conduct and are inclined to see something shocking to established usage in her impulsive reversals of form.

II

The present situation goes back to the Sixth of February. A tragic day -- and a turning point. That evening a Left majority in the Chamber was giving an impressive vote of confidence to the Daladier ministry. It was

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