Lump? Loan?

In the City, bustling citadel of London finance, "Leith-Ross of the Treasury" is an awe-inspiring name, but few Britons outside the pale of highest Empire finance have ever heard of him. Last New Year's Day small notice was taken when the King-Emperor made Sir Frederick Leith-Ross a Knight Commander of the Most Honorable Order of the Bath. Soon afterwards the City heard that tall, cool, piercing-eyed Sir Frederick, Chief Economic Adviser to His Majesty's Government, would be sent to the White House this autumn to negotiate a final settlement of the Empire's War debt to the U. S. He sailed last week on the Majestic with genial, expansive, moose-tall British Ambassador to the U. S. Sir Ronald Lindsay. With elaborate understatement, Sir Frederick observed: "I am visiting America to observe the feeling toward the question of the War Debts. I expect I shall be presented with an opportunity of discussing the position with President Roosevelt."

Correspondents learned from authoritative sources in the City and at the Treasury last week that Sir Frederick will propose: 1) to settle Britain's debt once & for all by a lump sum payment in Roosevelt dollars (worth 65-c- each last week); 2) to raise this lump by selling British dollar bonds to U. S. investors.

Under the Empire's present debt agreement Britain is scheduled to pay the U. S. roughly $11,000,000,000 in annuities running until 1984. The lump sum Sir Frederick reputedly has in mind is $1,000,000,000. If he finds that Wall Street cannot float so large a bond issue, the lump may have to be smaller. "The best solution, of course," correspondents were told by a candid Exchequer functionary, "would be cancellation of the entire debt."

Since only Congress can swallow or reject the British lump, and since Congress is not to meet until January, Sir Frederick and President Roosevelt face the pressing issue of what to do on Dec. 15, when a British annuity payment of $117,000,000 falls due. On the previous annuity date, last June 15, the President accepted a British "token payment" of $10,000,000 in lieu of the $76,000,000 then due. In London last week City financiers were confident that Sir Frederick will offer a "much larger token" on Dec. 15, hoping thus to put Congress in a lenient frame of mind.

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