THE CHEAP MONEY SCHEME.

Evening Post, Volume XLIX, Issue 109, 9 May 1895, Page 2

THE CHEAP MONEY SCHEME.

♦ I TRESS ASSOCIATION. | Brisbane, 7th May. Tits Courier, commenting on the Advances to Settlers Aot of New Zealand, considers it a good thing for the borrower, but Btrongly savouring; of injustice to the lending institutions and private mortgagees who have advanced loans on values which now leave them no margin. The Aot, it says, seems adapted to transfer to the Government Lending Board all the gilt-edged securities in New Zealand, and leave the ordinary money-londera such properties as are not good enough for the Board. This is calculated to extinguish the money-lending industry altogther. However, adds the Courier, the ingenuity of the persons whose interests are menaced is likely to be equal to the exigency, and there is a probability that some of the existing mortgagees will discover a means of foisting doubtful securities on the Board. (Received May 9, 11.15 a.m.) Stdnbt. This Dat. The Daily Telegraph, referring to the Brisbane Courier's article, says it hardly thinks go much of the gilt-edged securities will go to the Government lending office as the Courier imagines. It ia quite possible to place first-olass mortgages at 6 per cent , or even below that, at the present time, and therefore it is probable the more doubtful securities will be transferred to the State lending office. The effect will be to level down all rates to the official rate, and lending companies will only take the best properties on such terms. The rates are slowly coming down, and they would be even lower than they are now if it were not that the reconstructed institutions have to pay 4i per cent. The banking and mortgage companies will be conducted more economically and on a different basis iv fnture ; but still it is quite likely the Government Department will enpplant a good deal of the capital now employed. In the Advances to Settlers Act of New Zealand the politioal aspect of the whole prooeedim; is very serious, and the result of the experiment can only be tested by time. Striotly non-political and capable administration must be essential to its Bucoess.