NOTE ISSUE AND NOTE CIRCULATION

Press, Volume LXXIV, Issue 22337, 26 February 1938, Page 13

NOTE ISSUE AND NOTE CIRCULATION

TO THE EDtTOii OF TUB I'EIiSH. Sir, —Since the Reserve Bank was established my experience" has been to hear many arguments concerning the note circulation. . The outstanding thing about them was that a great number of people mistake the note issue for the note circulation. The Reserve Bank return, being published weekly, attracts the reader, and from it the note issue is readily obtained, but not the note circulation. The trading banks' return, from which the note circulation has lo be obtained, js published only once in about three months, and the note circulation figures are not so easily sorted out from the others. The last discussion I heard occurred at the meeting of Mr W. J. Lyon. M.P. for Waitemata. at St. Albans. The speaker, in comparing the note circulation under the National and the Labour Governments, said that when the National Government went out the note circulation was about £6,500,000. Then, as a member of the audience pointed out, Mr Lyon compared that amount with the peak Christmas note circulation of the Labour Government, using a little exaggeration as well. The figures, according to the Stalls- j tics from the Government Office just | to hand, are as follows:—The ordinary note circulation just before the National Government went out. was £6,500.000. as the speaker said, but for the two peak weeks at Christmas, 1034, j the'average was £7.200.000 under the! National Government: and at last I Christmas £10.000,000 was the average! for the two peak weeks. i This, of course, is a very great in-! crease, but in surviving the garden of note circulation, Mr Lyon added a little colour and numerical effects quite unnecessary in the circumstances. — Yours, etc.. A. E. FIELD. February 21, 1938.