HIGH FINANCE

Press, Volume LXXI, Issue 21399, 15 February 1935, Page 16

HIGH FINANCE

TO THE EDITOB OF I'HB PRESS. Sir, —In your leading article on Tuesday you said that the Government's creating a deposit of £1.000.000; in the Reserve Bank was a dilution of New Zealand's currency. I do not think that dilution is the correct word in this instance, as this act of the Government will not weaken the value of the New Zealand note. The Government has a long way to go in placing money in the possession of the general public before that situation can arise. Many debts will have to be paid up and a tremendous accumulation of savings in the banks. When the Government reaches ihe stage where it can obtain enough money from taxation to run the country on lines where the poorest can have a good standard of living, it will be time to cease (for a time) forcing money into circulation. The Exchange Act will keep the New Zealand note sound internally and externally so long as the overseas trade is controlled in a manner that will keep the accounts balanced, or provide a surplus in sterling The Government should compel all overseas trade accounts, as well as the transference of money either way, to pass through the Reserve Eank. This would facilitate keeping track of any variation in the balance of trade. They gave up public works in the Old Country as a scheme for solving unemployment, because the amount of money required scared the people in conrtol. It shows that those men were of limited vision and range. Lloyd George and John Bradbury showed how to get money to remunate people and win the war. If they let him, Lloyd George will show them how to employ and remunerate the rmemployed. Lloyd George spoke a true word when he said that no plan was good enough that was not of sufficient magnitude to accomplish its purpose. In New Zealand it will not only take £10,000,000 or £15,000,000 to give the unemployed a fair standard of living, but it will require that sum annually for that purpose alone.—Yours, etc., KAYE HOE. February 14. 1935.