How will the governments of the less developed countries be able to work out their heavy external debts? In other words, how will private banks such as yours, with lots of loans out to Peru, to Korea, fare, if they have to be renegotiated?

LDC lending is the current worry of people who haven't thought too much about the problem. It follows closely on tanker loans and New York City bonds--other items for popular worrying. We've been lending money overseas since 1897. We've never lost a dollar on any loan guaranteed by any central bank in any country in the world. That's not a bad record. We have a lot of countries today with balance of payments problems. We have Zaire, for example. We have Argentia, and we had some problems in Korea and some other places.

But the point is that it's within the control of human beings. Countries don't get balance of payments deficits unless they print too much money and it bleeds out through the borders. The International Monetary Fund is a skillful organization with which the private sector works closely. In Zaire, for example, we've been working with the IMF for a year. The IMF is in there, and they now have approved a settlement. If Zaire follows the IMF's package, I don't have any question in my mind that they will come back.

Tomorrow, there will be some new country in trouble. We've lent money over the years to France, Britain, Italy, about every country in Latin America. At the time each one borrowed it, of course, its balance of payments was in bad shape. Once again, I expect that with two or three minor exceptions, these loans will come right. There won't be any losses of any magnitude to the developing countries.