INVESTMENT LOSSES

Auckland Star, Volume LXIII, Issue 136, 10 June 1932, Page 6

INVESTMENT LOSSES

The Under-Secretary for Foreign Affairs in the- British Parliament said the other day that Britain could not continue to finance impoverished European States. The fall in the value of foreign bonds must have caused enormous loss to holders. If we take the highest and lowest prices on the London Stock Ebcchange for some of the leading foreign securities for twelve months wo realise how much the British investor has lost. Austrian 7 per cents fell from 9S to 35; Bulgarian 7 per cents from 78 to 25; Hungarian 7J per cents from 104 to 39; tftuniauian 7 per cents from 82 to 40; German 7 per cents from IOU to 03. Heavy losses have also been sustained in South American securities. Brazil 4 per cents have fallen from t>l to 10; Chilfian 0 per cents from 92 to 15; and Uruguay 3J per cents from (i oto 27. Great Britain has a large amount of capital invested in South America. It is estimated that British investments in Brazil total £300,000,000; in the Argentine £420,000,000: in Chile £97,000,000; and in Peru £26,000,000. Great Britain has advanced £40,000,000 for League of Nations loans, and it is said that half of this has-been lost. There have also been heavy losses due to currency depreciation. Wlten the franc dropped to 2d "British investors lost £32,000,000. British investors have also lost heavily through the fall in value of railway stock. Great Western ordinary has fallen from <S9 to 37; and Southern preferred from (SO to 30. Fluctuations in leading New Zealand securities have been slight compared with many European and South American countries. The greatest fluctuation in our 5 per cents last year was between 91 and 99, as compared with 58 and 85 for Australian 5 per cents. Of 23 gilt-edged securities listed on the London Exchange, N&w Zealand had the smallest fluctuations for 1031, It is evident that our credit is good and that investors have confidence in our financial soundness and integrity. —W.M.