A DIFFICULT YEAR

Evening Star, Issue 19552, 10 May 1927, Page 2

A DIFFICULT YEAR

There is no doubt the year wo are now in will be difficult. Wo sc.* on iho one hand falling revenue, lower bank deposits, increased bank advances, and on the other hand increased expenditure tor unemployment, "a'.mlv allowances. and other items. Thera has been a sudden contraction of our general purchasing power by the sale u our exports producing loss than the previous year. The banking figures are significant as showing the trend of decrease in purchasing power. A decrease in the bank deposit means less purchasing power at the command of iho public and less prosperity in business. Tto present depression is a direct result oi this fall in our" export prices. Hard times and good times come to all Governments alike, whether they be Liberal, Labor, or Reform. The rain falls on the just and the unjust alike, but in that case there is only Providence to blame or bless, whereas bad times are always charged as the fault .if the Governmsnt. Mr Baldwin said once that the English people always grumble, but they never worry, whereas foreigners worry, bul do not grumble. In New Zealand at the present time it looks as if people are doing both-—they are worrying about low prices and grumbling at the Government. But one thing is clear. When prices fall the farmer is the- first to feci the change, and from him it reacts gradually on the whole community. But it is. I think, easier for most other lections of the jieoplo to adjust themselves to falling prices. It is particularly easy in New Zealand from the trade figures and the banking returns to read the trend of events, and the merchant can often protect himself by curtailing his imports and reducing his stocks. But the ffirmer not only feels the effects of a depression first, but is the least able to guard against it, as his capital is not liquid and bis market distant. Nevertheless, the country is essentially sound. Tlitre is no reason why we should not be quietly confident even though we may have to exercise economy and thrift to an extent uhich we thought unnecessary while prices were high and trade buoyant. I unr.g the year production has been well maintained. and in some districts the production of butter-fat lias been phenomenal; while the value of our exports decreased, this was due to lower pruc.s. But as against this there has been a handsome increase in the volume of exports of cheese, lamb, skins, coal, seeds, apples, potatoes, and other items. Iho relative trade position of exports and imports has improved substantially as compared with the previous year, and is tending to a restoration oi a bcttei trade balance. The wheat crop has been bountiful. Woo! prices have been satisfactory. Many of enr manufactures have shown substantial progress. While the picture is not all sunshine, I think we can ’ook foiward to the future witn confidence.