SPEND OR SAVE?

Evening Star, Issue 21316, 21 January 1933, Page 17

SPEND OR SAVE?

TO THX BDITOK. gi r> _Many find it difiicult to answer the question as to whether it is wiser to spend or to save. The reply depends on circumstances. As a rule, the development and extension of industry is only possible out of savings; the seed saved from this season’s crop provides the means for next year’s sowing. It it was all consumed we should starve. In normal times money saved from our incomes provides the capital for industrial development, therefore in normal times saving is not only wise, hut essential. Under present conditions depressed trade does not call for the normal expansion of industry, therefore money saved from private incomes does not find ready employment, but is in many cases really put aside for the owner’s own future use against a possible fall in income. These savings therefore would appear to be dormant instead of functioning as they would under normal conditions; consumption is diminished by that amount, and the reduced demand for commodities reacts on trade and intensifies unemployment. The whole matter of spending or saving depends on each individual’s own circumstances, but for the reasons given above there seems to be no doubt that it is everyone’s duty to continue his normal expenditure on reasonable requirements as justified by his private income rather than button up his pockets. He can thus stimulate the demand for commodities, help tradesmen, and put new life into production.—We are, etc., N.Z, Welfare League. Wellington, January 20.