MONEY STABILITY.

Auckland Star, Volume LXIII, Issue 285, 1 December 1932, Page 23

MONEY STABILITY.

Let lie not lose eight of the fact that the interest on our debte is costing us, owing to the low value of our primary produce, more than double the rate ruling when the debts were contracted. Is it not possible to deviee sonic scheme under which tho cost of money will me and fall with tho value of our main primary products. This wouid prevent tho entire lose falling on the: industrialist*. It must bo recognised that under the shelter of high tariffs the secondary industries have been carried by the primary industries. From now on the country demands that each shall be eelf-supporting. On the present low value of our primary produce, the cost of money should not be more than 2 per cent. The only reasonable way to prevent a total collapee is to immediately pass legislation granting a State Bank the sole right to issue notes in New Zealand at not more than 2 per cent and if, as our bankere declare, our products are to fall etill further, » sliding scale of interest should be chargable by the bank, in conformity with the drop. Under this eoheme the relative positions of borrower and lender would remain unchanged. It is grossly unfair at present where a debenture-holder takes all. His money was no better than the money that went into share capital. Under a State bank a stabilised currency issue may do all the work chat the notes of the prseut banks do, and the only initial cost is that of printing. There is nothing to pa«s on to the borrower and all profits should go to relief of taxation. To get money into circulation is the only way to cure the depression, and I think the only way to get it into circulation would be by giving all mortgagors, the right to demand that the State Bank take over the existing mortgages. One way of stabilising values could be by way of a bonus payable on export values to maintain them at a fairly even level to conform to the ruling cost of money. How is it possible for trade to revive under present conditions? Wβ are rapidly going from bad to worse. Great Britain's policy is to buy in the cheapest market, therefore wo have either to find other markets and provide for our own defence, or adopt the same standard of living as our competitors for Britain s trade, unless a conference of the worlds producers is held with a view to the adoption of standard values and the cutting out of the ruinous c o ™?^! o "* o, * existing. WAKE UF.