“Ned Kellys” blamed for Aust, share losses

Press, Volume CXI, Issue 32778, 1 December 1971, Page 18

“Ned Kellys” blamed for Aust, share losses

Some recent losses on the Australian stock exchange had been caused by “Ned Kellys in pin-striped suits,” said Mr J. P. Young, an Australian personnel consultant, in Christchurch yesterday.

“Australia has always provided the world’s best confidence men, and some of the best of these have been found in the mining industry lately,” Heavy losses in mining shares had contributed to a lack of confidence among the country’s businessmen, and might be a factor in the present high rate of unemployment, he said. The number of unemployed was now 63,000. This was the worst for many years, and the figure was still rising steadily. It was thought that by the end of January the figure would be between 120,000 and 150,000. REASONS FOR POSITION

Among reasons for Australia’s present position were a loss of export income from primary produce; a reduction in Government expenditure to try to reduce inflation; and tiie refusal of the con-

sumer to spend his money, said Mr Young. Plenty of money was available both for spending and for investment, but instead of this being done, the level of savings bank accounts was the highest it had been in Australia’s history, and businessmen were not taking advantage of the capital available;

Mr Young said there had been an unprecedented flow of overseas currency into his country. “Australia,” he said “is drowning in foreign money.” He had been offered ssoom from Eurodollar sources at 9

per cent interest, and British finance was available to Australian companies at 9 to 12 per cent interest, and for periods ranging from five to 30 years. All that Australia needed was the confidence to make use of this capital, said Mr Young, though there might be some difficulty in servicing these rates of interest with the present state of the economy. INFLATION CONTINUES

One matter causing concern to Australian economists was that the rising rate of unemployment had not had any appreciable effect on inflation. This, also, was still running at a high rate.

“But, over-all, Australia is very sound one of the strongest economies in the world,” said Mr Young.

A consultant to the Christ-church-based firm of Peak Services, Ltd, which has five branches in New Zealand and 25 in Australia, Mr Young said that the shortage of full-time positions in Australia meant that more workers were available for casual and part-time work through employment agencies. Of the unemployed in Australia, 25 per cent were former executives, so that the range and quality of the available workers was also greater.