ECONOMIC POSITION

Evening Post, Volume CVI, Issue 55, 14 September 1928, Page 15

ECONOMIC POSITION

AN EXHAUSTIVE REVIEW BY PUBLIC TRUSTEE An exhaustive review of the economic position of tho Dominion is made by tho Public Trustee (Mr. J. W. Macdoiiald)' in his annual report to Parliament. It is true, states Mr. Macdonald, that the office is not directly a trading concern, and it does not deal on its own behalf in primary products, but, at the same time, from its very nature its business is closely associated with the economic life of the community. Although not constituted to be an cntcrpi-eneur in industry or commercial undertakings, the Public Trustee does from time to time carry on on behalf of estates businesses of various kinds, and administers all classes of business and other commercial .interests. Moreover, as the office controls such a large volume of assets, its business as well as tho interests under its management aro vitally affected by the interdependence or interaction of economic factors which affect tho- country at large. It is customary, therefore, in tho annual reports of the Department to make brief referonco to tho economic conditions of the Dominion. RETURNING PROSPERITY. In tho year 1925-26 the fall iv the returns from our staple products was, for the most part, only the passing result of the operation of tho economic laws for supply and demand, although, no doubt, such a fall augurs the-sotting-iii of an era of lower prices more nearly approximating the conditions of pre-war days. At the same time, the diminution in the principal income of the Dominion consequent upon this fall in prices left a good deal of leeway to bo made up in succeeding years. Whilst the year 1926-27 closed with an adverse trade balance and fluctuating prices, on the whole the rosult was fairly satisfactory, and a limited recovery in the'financial and commercial conditions of the country was noticeable, especially in respect to the purely pastoral interests. It is gratifying to see, states the Public Trustee, that during the year under review this recovery has been much more pronounced on every side, and the present indications prognosticate that New Zealand is gradually returning to a period of prosperity. The world generally is slowly returning to normal conditions of trade and finance, and is being freed from tho unprecedented fluctuations and chaos brought about, or at any rate atcelerated arid accentuated, by the Great War. Tho Dominion is indeed to be congratulated upon its extraordinary recuperative power and the recovery which it has made. CONFIDENCE' FOR FUTURE. "Over 90 per cent, of the Dominion exports," Mr, Macdonald continues, "are represented by agricultural, pastoral, and dairying products, and tho prosperity which we are now enjoying is largely due to the success which has attended those primary industries. Last year was a particularly good one in the principal branches of the primary industries, and all round substantial increases ou the previous year are recorded both in the volume of production and the sum which the products havo realised. The financial gain accruing from the increase in the proceeds of realisation is most satisfactory and will be of immediate benefit to the country, but the most pleasing feature of the figures is that of increased production. The volume of exports during tho past few years has shown a rising tendency, and the substantial increases for. tho past year are matters for general satisfaction. These increases are in no small measure due to increased efficiency brought about by more scientific methods of farming than those adopted in the past. The attention now being devoted to scientific and industrial research, and the increasing recognition amongst farmers of tho need for modern methods in their operations, inspire confidence for the future, and induce and encourage tho belief that the increases will be sustained. When our national income was so enormously augmented during and immediately after the war, the increase was an unhealthy one, brought about by the abnormal prices for our produce then ruling, engendered by conditions over which we had no control. Such an increase cannot be said to be in any way an index to the soundness of tho country, which, it is considered, can bo measured only by tho true economic gain of increased production, although, of course, the commercial and financial condition of the country depends to a large extent upon price conditions. PRICES MUST FALL. "It is a commonplace that years of prosperity and expansion are inevitably followed by years of leanness and depression. The psychological influence of prosperity oftentimes leads us into reckless trading and unjustified expansion and speculation, It is true that the, present indications in- tho wool trade show that tho prospects for woolgrowers aro very encouraging indeed. It is gathered from those who are competent to judge and make a forecast that the accumulations of the war and the near post-war period have now been all absorbed, and that tho demands of the manufacturers exceed.the available supplies. At tho same time, whilst the most reliable advisers from the great manufacturing centres intimate that not only are the present good prices likely to be maintained, but show a tendency to harden, it should be realised that tho existing ..price-levels cannot continuo indefinitely and sooner or later will probably fall. To pro- I vide for this producers should in their years of prosperity strive to reduce their liabilities, accumulate a store of savings, and improve their stock and rhethods, so that vfticn the fall conies tho quantity and quality of their products will compensate them for any diminution in the prices they realise. This policy is being adopted in the farming estates and other interests controlled by the Public Trustee. It is gratifying to be able to record that tho portion in regard to the collection j of amounts due to estates has very i much improved during the past two years, largely due to the moro prosperous economic conditions which have prevailed in the primary industries. DAIRYING INDUSTRY. "In the dairying, industry it is a matter of satisfaction to nolo the increased attention which is being paid to top-dressing and the improvement of herds. A recent writer in a publication devoted to dairying interests estimates that £5,090,000 is being lost annually through under-production duo to poor stock and to the neglect of herdtesting. It is interesting to observe that our competitors in the world's market—for example, Denmark and Ireland —are taking active steps in certain directions to overcome these probloms. The office administers a large number of estates more or less closely interested iv the dairying industry. Modern movements and the problems surrounding them aro carefully followed, and strict attention paid to facial's which will reduce, overhead expenses or increase production."