When Mr. Roosevelt called tramp money hot money, his felicity of expression deserted him for once, yet at the same time he gave a graphic description of a type of money that is not only hot, but very apt to burn the fingers of American creditors. Tramp money will not stay put; it is a form of short term investment for foreigners, affording quick liquidation and till free, in spite of the Securities Exchange Commission, to move anywhere. When the President speaks of tramp money, or hot money, he does not fear a sudden withdrawal of foreign funds from the present rising market nor the consequent financial danger to the United States, but he does remember with no little vividness the part played by this kind of money in fostering a "boom psychology," and in addition considers its connection with the war debts.

The New Deal has been loudly rebuked for its lackadaisical treatment of the war debts question. The major justification for delaying their payment has been removed, for no longer is there a shortage of dollars available for foreign investors. Experts point out that more gold and investment money has flowed here from war debtors in the last several years than is needed to clear their obligations.

If Mr. Roosevelt does anything to curb the flow of foreign investment, he may make some informal agreement with Europe whereby some of the European earnings from investment here will be applied to settle the war-debt account. At present European governments, for various purposes, are anxious to tap the abundant reserves of American capital and seek new loans from Washington and Wall Street.

Standing in their way is the Johnson Amendment, which prohibits lending to governments in default of their obligations, but unfortunately there may be legal methods to escape it. The only honest way for Europe to touch our financial reserves again is to climb out of the gutter of default.

It doesn't seem, however, that the American people want that. The mere suggestion of lending abroad conjures up images of foreign entanglements. Fortunately the New Deal is wary of accepting slight payments on the defaults as an excuse for lifting the Johnson Amendment, an excuse better termed a bribe. But in addition, the New Deal should be alert to the dangers of excessive American lending abroad a second time, both because of financial risk and possible involvement in the next European conflict.