WHERE THE MONEY GOES.

Evening Post, Volume LXXIX, Issue 76, 1 April 1910, Page 4

WHERE THE MONEY GOES.

GOLD COINS AS ORNAMENTS. "Specie"' i; editorially dealt with by tho N.Z. Trade Review, which after •showing the movements of that commodity during the past seven years, proceeds to state that the banks are under the necessity of maintaining reserves of coin in reasonable proportion to their liabilities to their customer, and for this purpose they require to keep their holdings constantly replenished by importations from outside. The importations have during the last seven years been at an average rate of £600,000 a year, while the exports have been at a yearly rate of only about £63,000. The excess of imports over exports is the large amount of £3,763,860, or a yearly average of £537,694. . The increase of the volume of the trade- of the Dominion, of the cost of land, and of the wealth of tho community naturally recults in aa expansion in the scale of banking transactions, and of the liabilities for which the banks become responsible, also of the coin reserves needed in respect of those liabilities. We thus find that the coin holdings of the banks, which at the end of iyO2 itood | at £3,124,916 had, at the end of 1909. grown to £4,977,994. The increase amounts to £J ,853,078. This, it may be observed, is less than one-half of the importation of coir, in the period. The difference between the two sums, namely, £1,910.782, lepresents the Jeak age in the currency, which ia known to be always going on. The chief causes of this leakage which, it will be seen, amounts to about £273,000 a year, are supposed to be the use of coins for ornaments, and in nrts and manufactures, and the taking away of money by colonists permanently or temporarily leaving the Dominion. The review states that "we have recently seen severe blanu cast, in print, upon some bank, not np'neil, which is supposed to have 'Taked in its coins and sent them to London." Well, the | above figures give the exports of coin from the Dominion for the last seven years. We see that the banks have biought in four millions in coin, and sent out four hundred thousand. It would almost appear that the critic referred to was not aware of this borne* what important fact. With t*ie exception of two sums the- smalt /early exports have gone th jelly to the neighbouring islands — Fiji, etc.,— for purposes of trade. The two siuns to which this does not apply are £80,000, shipped in 1906, to New South Wales, for ex ihangc purposes, and £225,000 in 1906, shipped to Uruguay, the funds of a Diitish financial company, which found it could use its money more profitably in South America than in New ZealandOf course the banks "lay have sent money out of the Dominion or brought money into it quite npart from coin. As a matter of fact, they brought in funds during the recent pressure to tho amount of some six millions to meet <!io requirements of their customers. The amount of coia sent out in* seven years is little more than a tenth part of that brought in."