HIGH EXCHANGE.

Auckland Star, Volume LXIV, Issue 100, 1 May 1933, Page 8

HIGH EXCHANGE.

i NIEMEYER'S VIEW. ; NO PERMANENT ADVANTAGE. «PREJUDICES STNANCE." (From Our Own Correspondent.) SYDNEY, April -28. Now that New Zealand is experimenting with a depreciated currency, or an artificially enhanced exchange rate, to raise the prices of her exports, any argument on either side of the controversy should be a matter of public interest. An interesting phase of this discussion has just cropped up at Melbourne. Professor D. B. Copland, as New Zealanders know, is a strong advocs.te of a high exchange rate, and he debated this question publicly some time | ago with Mr. Collins, chairman of the importers' section of the Melbourne Chamber of Commerce. Mr. Collins quoted Sir Otto Niemeyer as saying that "rising exchange rates prejudice the whole fabric of national finance." Professor Copland replied that "Sir Otto greatly regretted having uttered such a remark, and would gladly recall it." Mr. Collins, being certain that he has not misunderstood the re; mark, or misquoted it, wrote to Sir Otto for an explanation, and the answer that he has received is a decisive refutation of Professor Copland's claim. Sir Otto Niemeyer says that Professor Copland's expectation that he would be glad to recall this remark is quite inI correct; for, "whatever may be the balance of purely theoretical argument, on which the professors are not in agreement among themselves," Sir Otto declares once more that he does not believe that an inflated rate of exchange —which implies a depreciated currency —is in practice a permanent advantage to the country adopting it. Those interested in this question in New Zealand may conclude that this criticism, coming from so eminent and widely-acknowledged: an authority— largely undermines the argument on which the case for an inflated exchange has been founded..