Another Slump Coming?

Dominion, Volume 31, Issue 55, 29 November 1937, Page 12

Another Slump Coming?

Sir, —There appears to be a warning on the horizon that another slump is on the approach. The decline of stock on the stoek exchange in England, which is also refleeted in the fall of stocks and shares on our local stock exchange, and the fall iu value of the wool at the Auckland sales to-day indicate that a decline has set in. I would like to know how the present Government, and more particularly the National Party, propose to meet the position with regard to the producers of this country in the event of the position again becoming acute. If the production values of our wool, mutton and beef again decline to the low level of the past slump, one would like to know whether our overhead charges, particularly in interest on mortgage moneys on land, will be allowed to soar again to 8 per cent., or if the powers-that-be recognise that our financial institutions will be "required by legislation, that, is if they do not do it optionally, to co-ordinate with the market values of the farmers’ produce. As the fall in value of this produce takes place, interest rates must fall proportionately, the moneyleudiug institutions cannot be permitted again to jeopardise the producers by taking advantage of the position by asking the producer to pay an increased rate of interest when the production fnom his land fails to pay even 5 per cent., the current rate of normal times. If the past Government had pegged the rate of interest at the rate ruling at the time that the past slump first approached us, and thereby compelled interest rates to recede in keeping with the commodities of the land, the last slump would never have been so severely felt as it was. There would have been no need for “cuts” in salaries or for men to he put off the land. It would be very nice if, the present Government and the Opposition party would make it clear to the electors of this Dominion what attitude they would take in the event of the past slump conditions presenting themselves again. The parties have a duty to the nerve-racked electors created by the last slump to give then; some assurance that there is no fear of another recurrence. —I am. etc., NERVE-RACKED NATIONALIST. Marton, November 27.