DEPRECIATION OF CURRENCY

Press, Volume LXXVI, Issue 23080, 24 July 1940, Page 14

DEPRECIATION OF CURRENCY

TO THE EDITOR OF THE PRESS. Sir, —The Hon. W. Nash said in his Budget speech that borrowing from our New Zealand Reserve Bank would depreciate our currency, leaving his listeners to infer that borrowing from overseas would not. When we borrow money from overseas banks we have to give them security for the loan; in actual fact they liquefy or cash our own asset.

There is nothing to prevent our Government from tendering the same asset to our own New Zealand Reserve Bank and its lending or issuing New Zealand Reserve Bank notes against that asset. That asset then becomes the guarantee for those notes and is quite sufficient The Reserve Bank would be paid interest for the loan or advance, that interest to be sufficient to cover all bank charges against that issue. So as not to interfere or upset the internal economy in New Zealand, the above procedure should never be used for any purpose whatsoever except for public works. When public works are financed from the New Zealand Reserve Bank by the above procedure the said public works should be so rated as to pay interest and a sinking fund to pay off the loan. The Hon. W. Nash said that borrowing from the New Zealand Reserve Bank would depreciate our currency. Any extra money put into circulation does depreciate our currency, irrespective ,pf its source. It matters not whether it comes from the Bank of England, New Zealand Reserve Bank, or from John Citizen, it is still extra money being pumped into the amount already in circulation, and as such must depreciate it. The Government proposed to borrow £40,000,000 from overseas this year, and by so doing will increase our annual interest bill by about £1,500,000 a year—from £13,000,000 to £14,500,000. Because of attractive Government loans, heavy taxation and various other methods which the Government has of getting money, this country is going to be bled white of ready cash, so that industry may have difficulty in financing mortgages and advances for ordinary business needs, I consider that the Govern-

ment could, and should, make use of our Reserve Bank for financing its public works, so as to conserve our available cash for taxation and for general business purposes.—Yours, etc., J. J. O’HARA. Waimate, July 23, 1940. POINTS FROM OTHER LETTERS In further advocacy of a “thumbs up” campaign, Eric A. Clark (Wellington) writes: “Since writing my first letter, I have seen further photographs from England in which the ‘thumbs up’ sign is used, likewise on newsreels. So evidently Englarfd does not think it a ‘cranky idea.’ ” :. J. Buttle (Darfield) v/rites: “It is grossly misleading to describe this war as a racial conflict, with Teuton and Latin opposed to Anglo-Saxon, and unjust to important minorities of liberalminded Germans and Italians. The war is, or ought to be, between those who have faith and confidence in God, or, in secular language, those who have faith in qualities which, if developed in men, or to which men were devoted, would produce a decent environment, peopled by free and responsible individuals. against those who are deficient in faith in God or men and desire authoritative restrain! upon the minds, bodies and estates of men, so as to convert what is admittedly more or less a jungle into worse, a zoo.” G. McCormick contributes the following hint on tomato-growing. “Some time ago I read that the coal miners in Wales, England, had grown big crops of tomatoes on poor, rocky soil, by sieving their coal ashes, digging them into the soil, and then planting. The results were amazing. The ashes must not be exposed to air or moisture, but dug in as dry as possible. With this mamue this vegetable fruit can be grown quite well. Wood and weedy vegetation can also be burnt and used similarly.” Referring to the promotion of Herr von Ribbentrop to the position, of group-leader in the S.S. (Black Guards), “New Zealand Registered Nurse” writes: “I have heard many titles given to Herr von Ribbentrop (and to other German leaders) by my own sex, and more especially by other members of my profession, but I consider that given to him by his own people the most choice and most appropriate of the lot—“ Group-leader of the Blackguards!” I shall continue to watch for his further—in fact, meteoric —promotion in that group." _