The Auckland Star: WITH WHICH ARE INCORPORATED The Evening News, Morning News, The Echo and The Sun. WEDNESDAY, OCTOBER 25, 1933. THE RESERVE BANK.

Auckland Star, Volume LXIV, Issue 252, 25 October 1933, Page 6

The Auckland Star: WITH WHICH ARE INCORPORATED The Evening News, Morning News, The Echo and The Sun.

WEDNESDAY, OCTOBER 25, 1933. THE RESERVE BANK.

For the cause that lacks assistance, For the wrong that needs resistance For the future in the distance, And the good that ice oan do

In two respects Mr. Coates' case for the Reserve Bank Bill lias been strengthened since the measure was introduced. He has received the support of all the banks but one for the principle of the Bill, and he has responded to the request for figures showing how the State will gain and lose directly by the establishment of the new bank. Mr. Coates' figures give a net annual gain to the State of £640,000, and while some items are not clear, the calculation may be accepted as approximately correct. At any rate, if it is not there are banker's who will promptly point out the inaccuracy. But the most interesting point in yesterday's debate was the friendly exchange between Mr. Coates and the Leader of the Labour Party on the power conferred by the Bill to print notes hero against credits in London. "That-will do me," said Mr. Savage. When the Labour Party applauds a Government statement on the use of the printing press in currency creation the orthodox world is bound to be suspicious. There are ten millions of credits in London, and there will be more if the high exchange rate continues. To issue notes against this product of unsound finance would be inflation, which, of course, is what tho Labour Party desires. Mr. Coates says tho new bank would do the issuing. Is he expressing a confident hope, or does he intend to issue an instruction or a request to that effect? Whichever it is, Mr. Savage is satisfied. Indeed, tho Leader of the Labour Party must be far from completely dissatisfied with the Bill. Not only does it promise to set the printing presses going for the purpose so long advocated by Labour, but it establishes an institution that is difficult to distinguish from a State bank and which could be very easily turned into one, with the Government in full control of all its functions, should Labour be called on to form a Government.