AMERICAN EXCHANGE

Evening Post, Volume XCIX, Issue 121, 22 May 1920, Page 9

AMERICAN EXCHANGE

TO IHI IDITOR. Sir,—l read Sir Joseph Ward's remarks on the above subject, and note the account of your interviews with prominent financial men, together with their opinions. I consider Sir Joseph's opinion is right and solid. In my opinion the present adverse rate operating against us may be defined as a "tax on patriotism." New Zealand's balance of | trade should leave our credit at par anywhere in the world. If it is possible for A producing country, such as India, to nava her own rate of exchange, it should be feasible here. Then, again, Argentina has a stabilised exchange with London, and is free on the New York market^ The present mode operates to a considerable disadvantage to New Zealand, as it enables England, not only to make profits of our produce by selling it to the United States, but benefits by exchange thereon. I fail to see how tho present arrangements can be considered excellent -by your informant. They may be allnght m normal times. No doiiblt it may mean that instead of a considerable portion of our produce being disposed of to various nations from\London ■London may have to acquire some • via New York. The present adverse rate lias, no doubt, been largely worked by the huge British Banking Corporations to bolster up British trade, and raise a preferential tax indirectly against American goods. The British economic spirit as against theianks' spendthrift habit, will enable Britain to dictate to America ip ten years time, without the recourse of losing her colonial trade. The possibility of our exchange on London reaching an adverse level is rather remote, as tne_ balance of trade will for a long w'hil* be in our favour/ No doubt we wish to keep trade on Imperial lines; but surely this can be managed without putting toe big a price on it. The concluding note of. your interview, as regards "exchange finds its level." might very aptly be ap plied as_to the remarks about London buying New York exchange through New Zealand. It would mean that the En" lish pound would be worth about 17s 6d here If our sales were through New *oric on par our income would be greater.—l am, etc., 21st Slay.