THE ECONOMIC OUTLOOK.

Auckland Star, Volume LVII, Issue 26, 1 February 1926, Page 6

THE ECONOMIC OUTLOOK.

The warning about depression in our I export trade and dearer money that : Sir Harold Beauchamp uttered at a company meeting in Wellington to-day should be studied by all. Sir Harold is no alarmist, but he is a banker of long experience, who lias always studied conditions abroad as well as conditions at home. He points to the heavy demands on the London market; to the increase in the price of money here; to the unfavourable nature of the local bank returns in the last quarter, which showed that the demands on the banks were exceptionally heavy; and to the drop in thfe prices of produce. He estimates the decline in export values at the great sum of twelve millions, which, on the. receipts of the season 1924-.1, would represent more than twenty per cent. This country could not drop twelve millions in exports without feeling a financial pinch. There would be less iocal money for investment. The position is, therefore, that there will probably be further heavy demands on the London market by the Dominions and other borrowers, which will harden rates, and that the amount available for lending in New Zealand will be restricted by the decline, in export values. It is a long way to the end of the season, and it may be found that .Sir Harold has overestimated the decline in values, but there are quite sufficient danger signals on the landscape to justify his appeal for economy.