A FIDUCIARY ISSUE.

Auckland Star, Issue 17, 21 January 1932, Page 6

A FIDUCIARY ISSUE.

Britain has a large fiduciary issue based on its national security. Wliy should not this Dominion in tliis time of acute financial strain, in a limited manner, adopt it to relieve ■ the unemployment problem? We are< told that we cannot borrow abroad for some years . to come and that we have no money in sight to adequately deal with the question on a basis benefiting the colony as a whole. I venture the opinion that if we issued, say,. . £2,000,000 per annum State notes for a period of, say, two years and it was strictly limited and solely applied to reproductive work's, such as breaking in and settling Crown lands, afforestation, scientific exploration and development of our mining areas, particularly the refractory low-grade ores in this province, roading and farming assistance, we. could, in two years, either raise a loan to call in and pay off these notes, or convert tlieni into stock bearing a low rate of interest. Banking institutions have the right of issuing notes against their reserves, and surely our national reserves are greater security. New Zealand, being productive country, is in a unique position to have a moderate and limited fiduciary issue, because she can pay her interest abroad from, her exports. She is unlike Australia, whose magnified secondary industries have reached the point of saturation, or Britain, which is an industrial country. It would give. the longsuffering and struggling taxpayer,, who- has ' nearly conic to the end of his resources, imme'*" diate relief, and, if wisely administered, it would save immense suffering and depression during the next twelve months, the shadow of which darkens more deeply as winter' ' approaches. I realise the suggestion will call forth any amount of destructive criticism, but here we are, in this country to-day, face to face with a financial crisis of the first magnitude. We have thousands out of work demanding the sustenance of life. The revenue is falling and we are unable to borrow abroad,' and an internal loan is pending to carry on our public services and assist in payment of interest due. Is my suggestion not worth very serious consideration? E.D.