REPLY TO "THE PRESS."

Press, Volume XLVIII, Issue 14380, 13 June 1912, Page 7

REPLY TO "THE PRESS."

(From tho "Lyttelton Times" correspondent. 5, ) WELLINGTON, Juno 11. When Sir Joseph Ward was shown iho comment of a southern newspaper regarding tl\p flotation of tho four million loan, ho replied that, as ho was not responsible for the financial transactions of tho country, he would offer no opinion upon the operation itself, though he wished to say that the finances of Now Zealand were in strong and eapnblo hands with tho Hon. A. M. -Myers as Minister of Finance. He would, however, willingly deal with the personal attack in tho article. Apparently it was the intention of the Conservative organs to commence a similar campaign to that which they adopted in connection with tho five million loan. To talk about "tho shocking state of New Zealand credit and the financial reputation of tho Dominion being destroyed," and to impute to him that he stopped negotiations for a loan so as to harass Mr Massey, was tho kind of tiling one expected to get from a guttersnipe Press, but not from any respectable journal. "Tho imputation that I was ready for that object to do something which would injui'o the country is about tho most monstrous and untruthful suggestion thnt could have emanated "from nnv sniM brain." said Sir Joseph. "Everything I did in connection with the matte * is on record in tho Treasury, and I adopted what f believed to be tho right and proper course, which was that while niMrirxr proper provision (rr the country T did not tie up tho hands of any possible successor." THE COST OF THE LOAN. Dealing with tho suggestion that tho loan wae costing £'5 3s per cent., Sir Joseph said tho cables showed tho rate of interest to ho £3 10s 9d per cent. Anxiety to depreciate tho country's financial position resulted in failure to draw the lino between rate of interest rind tho cost of discount and underwriting, and no sane mnn would contradict him whm ho srtic! that no country in tho world e>:cent Britain (and even Britain und°r nrosent conditions could not bo oyooptod) could float a loan without providing for discount nrd for underwriting. It was impossible for anyone to priy the loan wns goi"c to iwt, including those- charges. .£5 3s unions he wns r> to stnto wlint the position wrMild hn when tjio loan wne to bo repaid. It. wns quito the rrri.nvment miilrh be nrrannrd on fnvourahle trn'ms that n lnrgo portion of tlic umlwwriting and discount , could bo recovered. THE STATE OF THE MARKET. Sir Joseph suggested that the condition of tho money market ought to bo taken into consideration in connection with tho transaction. A Tokio loan at 5 per cent, of nearly nine millions, which was guaranteed by tho Japanese- Government, had not realised anything approaclrng tho New Zealand three and a half per oent-., though Japan's population was forty millions and she ranked amons tho first nations of the world. Then there was a Chinese loan of five millions reported that day at 5 per cent, realising £94, while tho New Zealand loan was put on tho market at £99, and was favourably spoken of by tho British financial papers. "1 hnvo," continued Sir.Josep ,l , "no personal knowledge* of what has transpired recard'ng this particular loan, but J look at tho published statement that a sixty million loan is being raised for China in October. The writer of the article mu"?t be blinded ' with political auimos'ty if ho cannot realise what tho effect of that transaction must be on tho monov market. There was no suggestion of this sixty million loan prior io my leaving office and it would only bo a fool who would sunnose that after tho announcement of tho sixty million loan the condition or the money market would bo tho same as before. Some years aip the South Australian Government tried to avo ; d tho London broker :ti tho raising of loans, but they found it so unsatisfactory that they had to come into lino again with other countries and conform to tho , rules of tho London Stock Exchange. It would bo a thing if Opposition editors br> ftivon a couple of yonrs on tlic Stock Exchange-, <x> thnt they could understand tho system and see the absurd'ty of crying out ench time this country raised a loan about what it ought to liavo done.

"Whpti one exnmines the history of the landing of moneys to th« dominions bv_ British money lenders for tho H"t thirty or forty years," continued Sir Joseph, "it will bo found t-hnt they from ono-hnlf to one per cont. lon'or frinn tho rnonovs that offier oewntr'cs have borrowed from them. Of oour?o. tlii« does nnt singly to 'onns to Great Bntnin. bo thY Brit'sh cnlomos. including Now Zenlnrd, havo ■no+hinc: to of ;v> far as the fint?t ; nn or cost of loans is concerned."