HIGH COST OF REARMAMENT

Press, Volume LXXII, Issue 21827, 6 July 1936, Page 11

HIGH COST OF REARMAMENT

EFFECT ON LONDON SHARE MARKET MR SAVAGE’S STATEMENT CRITICISED EASING IN WOOL PREDICTED (UNITED PRESS ASSOCIATION —COPYRIGHT.) (Received July 5, 6.30 p.m.) LONDON, July 4. The announcement of the Chancellor of the Exchequer (Mr Neville Chamberlain) on the budget deficit startled the city. There is no precedent for such an announcement so early in the financial year. The contemplated increased expenditure is believed to be at least £5,000,000, which will have to be met from borrowings. This brings sharply home to the public the tremendous cost of rearmament, and lends special significance to Mr Baldwin’s denunciation of the “mad folly” of driving Europe to such ruinous expenditure on war material. “Memories of Mr Lang” Mr Chamberlain’s statement was too late to influence the gilt-edged market which was indirectly affected by Mr Savage’s tactics, whose latest reported criticism of the financial press raised uneasy memories of Mr Lang. Many city business men are so touchy on the subject of the sanctity of contractual obligations that any suggestion that they should be varied will always raise a storm of criticism. New Zealand’s excellent standing record, however, will ensure that Mr Nash will be sympathetically received, provided there are no attempts to force conversion upon bondholders. The “Economist” points out that the increased cost of New Zealand’s debt service is largely due to the deliberate depreciation of the exchange. Both parties entered a loan contract on money terms, and a revision in favour ”cf the debtor presupposes the right of a similar revision in favour of creditors if the value of interest and principal in terms of commodities fell. The “Financial News” hopes Mr Savage will not risk the closure of the London market to New Zealand for the sake of a small debt saving. He naturally asks relief, which bondholders naturally refuse. There, everyone hopes, the matter will end. The Rise In Wheat The commodity market has enjoyed the most active week for some time. Notably, the spectacular rise in wheat is due to most unfavourable reports from the United States. The world has now, for the first time since 1928, huge surplus stocks to draw on. Should the harvest be a partial failure there is a danger, however, that the rise may be overdone. The United States crop is estimated at 140 million bushels. This should be sufficient for domestic requirements, though the country may require Canadian at the end of the year. Reports from Canada are unfavourable. but the crop should be larger than it was last year. The decline in the tin market was resumed. Despite the favourable statistics, the market is being absorbed in the progress of the negotiations in the new restriction scheme. The Siamese Foreign Minister has demanded a quota of 18,000 to 20,000 tons, which is most excessive. There is little doing in the butter market Fluctuations around present values are likely to continue. The arrivals of apples have markedly declined, but offerings are still in excess of market requirements. Receivers are retaining parcels of Stunners and other hrrd varieties. When conditions are suitable the offerings will consequently be lessened. Prices, th ugh still unsatisfactory, are slightly increased. Heavy rains affected the gathering in of the cherry and strawberry crops in England, lessening the competition. Most of the apples offered are of very ordinary quality. There is little business in pears, supplies of which are light. The Wool Sales Wool traders are reluctant to forecast the course of the wool sales terminating on July 17, four days earlier than last year. The volume and direction of the demand is problematical. If anything happened to create a better demand and prices offerings would be quickly augmented from stocks held in London, though such slocks are not substantial. France is expected to operate considerably. Italian and German buying is improbable. Leading traders expect best merinos to open at par to 5 per cent, lower, average merinos 5 to 7J per cent, decline, fine crossbreds may be 5 ner cent. down. Lower sorts will orobabiy be unchanged, as the demand has been encouraging for some time. TREASURY BILLS HEAVY SUBSCRIPTION isßmaa oeticul wieelem.) RUGBY, July 3. The amount applied for in tenders for £50,000,000 Treasury bills was £72,750,000. The maximum amount was Allotted in bills at three months. The average rate per cent, was 12s 1.27 d. • LONDON APPLE MARKET " ■ % LONDON, July 4. Apple* are meeting with fair enquiry and are firmer. New Zealand, ex Tonnriro, Cumberland. Hororata, and Rangitata. are quoted:—Granny Smiths, 8s to 12s; Stunners. 7s to 7s 6d; West Australian Granny Smiths, 10s 9d to 12s 9d; Tasmanian Stumers, 5s 6d to Bpfcarsare ß pfcarsare quieter. Australian Boases, its 9d to 10s; Coles* 6s 6d to Ils 6d, |

Batter

(BRITISH OFFICIAL WIBILE3S.'

PRICE OF GOLD

DAIRY PRODUCE

BUTTER MARKET FIRM

The New Zealand Dairy Board has received the following market report from its London office dated July 3: —

New Zealand, salted, 106s to 108s up to 109s (last week, 105s to 106s) (equals approximately 12.64 d, f.0.b.); New Zealand unsalted, 107s to 103’, ex 110s (107s to 108s); Australian, salted, 105s to 107s (104s to 105s); unsalted, 105s to 106s up to 107s (105s to 106s); South Africa 100s to 102s (102s to 103s); Danish, 955, f.0.b., 117s (spot 93s and 117s); Dutch, unsalted, 88s to 100s (98s to 100s, ex. 104s); Estonian, salted and unsalted, 99s to 100s (98s to 100s); Siberian, salted, 101s to 103s; Ukranian, salted, 102s to 103s; Polish, salted, 92s to 95s (94s to 955, ex. 965); Polish, unsalted, 92s to 95s (94s to 955); Lithuanian, salted, 99s to 100s (98s); Lithuanian unsalted, 99s to 100s (98s to 100s). Market firm. Retail prices unchanged. New Zealand Is Id, Danish Is 2d. Cheese New Zealand, white 58s to 59s (58s); New Zealand, coloured, 58s to 59s (58s> (equals approximately 6.48 d, f.0.b.); Australian, white 56s to 57s (56s to 56s 6d); Australian, coloured, 56s to 57s 6d (56s to 575); Canadian, white, 67s to 70s (66s to 68s); Canadian white, c.i.t., 61s 6d (61s); Canadian, co.oured, c.i.f., 61s 6d (625). Market firm. New Zealand retail price unchanged, 7d. English lacioiy cheese 56s (55s to 575, ex. 58s) —Quiet. The minimum x.o.b. prices for the period auiy 4 until xurtner notice are unchanged at: —.butter; 13d, less 1( per cent, commission (104s 3d, c.i.i.ei; cheese: 6Jd, less li per cent, commission (60s 4d, c.i.i.e.). SOUTH AUSTRALIAN ORANGES GROWERS* REPLY TO CRITICISM CUMITED P&S33 ASSOCIATION —COPYRIGHT.) ADELAIDE, July 4. Discussing the fixation of prices of South Australian oranges entering New Zealand, the acting-secretary of the Murray Citrus Growers’ Association (Mr J. J. Medley) said that the published comparison of the retail prices of Island and South Australian oranges in New Zealand suggested either that New Zealand was a congenial place for fruit retailers, or that those whose personal interests such comparisons might serve were treating the facts with scant respect. The statement that South Australian oranges purchased at approximately twopence each could be retailed at 2Jd each heeded no comment. The Soutn Australian growers obviously could not control the retail prices in the Dominion. The obvious intention of the comparsion was to impute profiteering to those controlling the supply of South Australian oranges to New Zealand—more or less a repetition of previous efforts which had been singularly unsuccessful. [A Wellington retailer, criticising the price* fixed for South Australian oranges, stated: “Island oranges of the 126-sized case are being sold at present at eight for Is. Australian oranges of the same size will be retailed at five for Is. The largest size, after allowing for wastage, will actually cost the retailer 2Jd each.’’] MINING THE WEEK’S RETURNS (PRESS ASSOCIATION TELEGRAMS..) GREYMOUTH, July 4. Maori Gully—sooz sdwt for 130 hours. Golden Sands Sluicing—22oz 18dwt for 28 shifts of eight hours each. Addison’s Flat Sluicing, to June 27 30oz 12dwt for 42 shifts. GREYMOUTH, July 5.

Mossy Creek—ssoz lldwt for 9035 yards dredged in 124 hours. The company has declared a sixth dividend of 6d a share.

DUNEDIN, July 4, Okarito —13oz 3dwt for 130 hours,

THE METALS MARKET

LONDON, July 4. Gold is quoted at £6 19s OJd a fine ounce. •

RUGBY. July 4. July 1. July 3. Copper— £ s. d. £ s. d. Standard, spot 38 11 10i 36 14 44 Forward 36 16 10i 37 0 n Electrolytic 40 10 0 40 15 0 to 41 0 0 40 10 0 Wire bars 41 0 0 40 10 0 Lead— Spot 15 3 9 15 6 3 Forward 15 6 3 15 10 0 Spelter— Spot « * 13 7 6 13 8 9 Forward 13 13 9 13 15 0 Tin— Spot 178 7 6 175 5 0 Forward 175 7 . 6 172 7 6 Silver — Fine, per oz Standard, per 19 7-16d 19gd oz . 21d June 25. £ s. <L 20|d . July 3. £ s. d. Pig Iron— British 3 10 0 3 12 6 Export 3 10 0 3 12 6 Antimony— ... . British • • 67 0 0 67 0 0 Foreign • • 40 10 0 40 10 A unit. 0 Molybdenite • • 1 16 6 1 16 6 Wolfram 19 8 1 8 9