WAY TO INFLATION

Evening Post, Volume CXXXII, Issue 79, 30 September 1941, Page 9

WAY TO INFLATION

HOW TO AVOID IT

Mr. James Love, chairman of the Queensland National Bank, referred to the way to inflation and how to avoid it, when he addressed shareholders in the bank. He stressed the importance of limitation of individual or personal expenditure, and "a resultant increase of savings." In this way much hardship in the future might be averted. "Government loans or other forms of borrowing, such as War Savings Certificates, are the proper home in these times for savings accumulated by the individual. If we fail to meet our national requirements from these avenues as we go along, inflation will inevitably result. While the latter to a limited degree is unavoidable in time of war, a spiral growing until it becomes uncontrollable must be avoided at all cost.

"To this end, therefore, we must willingly accept heavy taxation, and in addition we must definitely save and lend to the Government to the maximum of our ability. The easy methods of 'costless credit' and^ 'borrowing from the banks' by Governments are only a stepping stone to increased deposits with financial institutions, thus augmenting purchasing • power, in the hands of the individual when, as the result of change over from peace to war production, less civil consumption goods are available—in other w.ords the direct road to inflation." *

Concluding, Mr. Love said: "There has never been a time in our history when it was so essential for every citizen to divest himself of complacency and to whole-heartedly address himself to his duty, whatever form it may take." It might be difficult to keep up the present return to shareholders of the bank, but "our obligations to the national interest must be paramount m the existing crisis," said Mr. Love.