CURRENCY AND PRODUCE PRICES.

Auckland Star, Volume LXIII, Issue 140, 15 June 1932, Page 6

CURRENCY AND PRODUCE PRICES.

Many of your correspondents have been advocating a policy of currency control allied to mild inflation, but it is difficult to understand how such a scheme would prove feasible in view of the fact that currency in itself is' nothing, being covered by the definition—a common denomination for measuring the respective values of commodities. What is wanted is stabilisation of commodity prices, coupled with the raising of the standard of living to the level existing in 1920-29, on which level" our present huge indebtedness is based. This can only be achieved -by scientific control of imports to regulate the volume and designation of imports and ensure parity of exchange. With the incomings and outgoings nicely adjusted we can create in this country anv reasonable standard of living that wo wish to by the simple process of stabilising commodity prices internally at a level sufficiently above present world parity values to allow of the farmer receiving a remunerative return and to compensate him for the loss he would incur on the removal of the present 10 per cent exchange. Imports control would, of course, result in building up our secondary industries, and raising commodity prices would necessitate wages being increased. With an internal loan to permit of reasonable wages being paid to relief workers, the increased money in circulation would he sufficient to start the ball rolling in the right direction, and the so-called currency problem would merely resolve itself into a question of keeping sufficient notes in circulation to satisfy the legitimate requirements of trade. J.M.B.