CONFIDENCE AND MONEY SHORTAGE

Evening Post, Volume CXII, Issue 116, 12 November 1931, Page 12

CONFIDENCE AND MONEY SHORTAGE

(To the Editor.)_ Sir, —Apropos of the present depressed state of this country and the world in general, may I be permitted to express a few opinions and perhaps suggest some- j thing by way of a solution to the unemployment problem. As a preliminary it may be advisable to repeat the .well-known fact that the apparent shortage of "money is not really a shortage but a' cornering or trying'up o£ resources, a lack of confidence or a state.of "wind up" as we described it in the war days. ■What is desired is a restoration of that necessary confidence and a reasonable circulation of the money at present hoarded up bringing about the inevitable reaction in the spending power of the community. Probably the most far-reaching business in the life of the people of to-day is the building trade, now practically at a standstill. Commercial buildings, homes, and alterations and additions to these types of building are still required, but the work cannot go on owing to lack of funds, and the impossibility of raising building loans upon a satisfactory basis.* Lack of confidence again. In the meantime, building costs have dropped almost to a pre-war level, all materials and labour are1 cheaper and competition is keen as evidenced by the number of builders tendering for small jobs and the decreased prices of the tenders. At the present time £1000 will go as far as £1300 went two yeass ago, and as prices cannot conceivably become lower, a priceless opportunity is being lost through inability on the part of building owners to carry on their projected schemes. , ' ■ . ■ . If the people who control the sources of mortgage finance would only realise that this condition exists and that the, risk of advancing money is almost negligible, they, by loosening their purse strings would open up avenues of employment to literally thousands of out-of-work professional men and tradesmen. Money would circulate more freely and all sections of the community would benefit in some way by the restoration of spending power. In addition, the values of the securities would rise •as the market improved- and property would again become a realisable asset rather than a liability which it is at present. A careful investigation has been made with regard to the number of people who would' benefit directly and indirectly by the erection of one moderately-priced house, and it is truly amazing when one comes to consider the ramifications from this one source. To quote a few of the principal people who would benefit directly: (1) Architects; (2) builders; (3) their workmen; (4) sub-contractors (i.e., plumbers, painters, paperhangers, electricians, drainlayers, joinery manufacturers, specialist trades). Then come the merchants, their workmen and salesmen, office stafis, transport, manufacturers, indent agents, and so on ad infinitum. It will be seen that the spending power of all the abovenamed has been increased and this..benefit is passed on to the shopkeepers and numerous other services which cater for the need of mankind. If' every mortgagee and all property owners will realise that a few pounds spent in renovations, additions, and alterations to, existing buildings, painting, fencing, etc., will tend to circulate through the channels mentioned,-then.they will materially assist by putting work in hand and will have the satisfaction of knowing that they are contributing to the relief of unemployment and hardship. A Bteady increase of work by this means should have a beneficial effect on the mental and financial outlook, and it is up to all those people who possess the power to try.and bring this improved state about.—l am, 6tC" ' WILLIAM J. M'KEON. - 'i i ' 'i