BANKING SYSTEM

Evening Post, Volume CXXI, Issue 83, 7 April 1936, Page 16

BANKING SYSTEM

INDEPENDENT VIEW

Claiming that the banking system had not been of benefit to New Zealand or the world at large, Mr. A. C. A. Sexton (Independent, Franklin) said the same.old arguments had been used time and again. The people were told to look to what had happened in Germany; that the Bill before the House would destroy confidence; and that the system must be left to the experts.. "It has been tried and found wanting," he declared.

The monetary system had failed in that the people had at no time had sufficient money in their own hands to buy the goods manufactured, and the banking system had failed to place that money in their hands. The banks contended that it was not their business, so the time had come to get an institution that would make it their business to allow those goods to be passed over and consumed where they were required.

The experts had made some egregious blunders during the last twenty years. When the Great War broke out their system collapsed, and their doors had to close. The British Government and other Governments had to come to their rescue, Great Britain financed her war operations at the commencement by Treasury notes, but that lasted only for a short period, financial interests finding out that their system was doomed if that were allowed to continue, and the war loan system was introduced. The British Government fell for that and £8,000,000,000 was left as a burden as the result of the system. That was the first blunder. The second blunder made by Great Britain was that of deflation, and the third blunder was the reverting to. the gold standard in 1925.