GOLD EXPORTS.

Auckland Star, Volume LXIII, Issue 262, 4 November 1932, Page 6

GOLD EXPORTS.

It is doubtless true, as "Barrister" maintains, that there is no need, for the banks to hold gold in New Zealand, 'but "Barrister overlooks the fact that the premium obtained by exporting this gold does not legitimately belong to the banks. Much of this gold was acquired from the public in 1914 in exchange for the banks' own notes, which have on their face a promise of redemption in accordance with the charters under which the banks were licensed to issue notes. A benevolent but l"' advised Government ordained a moratorium excusing the banks from honouring the» promises of redemption upon sonic six n ll }' lion notes and any more they cared to printFor eighteen years this moratorium has bee® extended by Order-in-Council and the banks have now come to regard these millions o{ promises as no longer binding, and to regard the sovereigns acquired in exchange for these specious promises as legitimately their ownActually the sovereigns are worth 31/6 and the promises by which they were acquired are worth but 20/, so that a profit of 11/8 V er £1 promised is made. This profit could oot possibly have arisen if the moratorium not been granted, and consequently any -profi' should be retained by the State, which granted the moratorium. The moratorium was passe® as a war-time emergency, and should not have been continued. The banks' balancesheets and dividends show clearly that they did not need a moratorium, and they certainly do not need a bonus of 11/0 in the pound on all gold in the public's hands in 1914. 1 5. SOLICITOR-