BACK TO THE LIGHT

Evening Star, Issue 21318, 24 January 1933, Page 10

BACK TO THE LIGHT

MONTAGU NORMAN POINTS WAY INTERNATIONAL ACTION Mr Montagu Norman, governor of the Bank of England, making his first public speech since the crisis of a year ago, expressed the hope that there would be an improvement in trade in the near future (says the London ‘ ])aily Telegraph ’). If the Governments could act together, he said, things would be different. But they apparently could not do so, and the difficulties of the international situation-remained “ so vast and so unlimited ” that he could “ see the light at the end of the tunnel only somewhat indistinctly.” Mr Norman was speaking at the annual banquet which the Lord Mayor gives at the Mansion House to the banking interests. The occasion should have given opportunity to the Chancellor of the Exchequer for reviewing the outstanding events of the year, but the importance of the debate on the Ottawa agreements in the House of Commons prevented Mr Neville Chamberlain from being present. His place was taken by the Minister of Health (Sir E. Hilton Young, M.P.). Mr Norman was replying to the toast of “ The Bankers and the Merchants of the City of, London,” proposed by Major-general J. E. B. Seely. He said:

“One of the great things which has to be disposed of is the question of frozen credits throughout Europe. There is nothing which impedes business and the prospects of the bankers to the same extent as this. How it is to he achieved I do not know. “ Another point is this. In the past wo were, by tradition and by reason of our ability, great lenders. Lending here was practically indiscriminate; it was merely competitive. Can that continue with the same freedom in the future? WILL COME AGAIN. “ The time will come when great opportunities for investment, speculative investment included, will he offered in several places east and west of here. It has happened before; it will happen again. What we need when that time arrives is a. robust and long-sighted industry and commerce which here can offer the same attraction in investments as will be offered in other countries. “ I look forward in the near future to growth and development and improvement in the industry of this country, upon which in a large measure the business of bankers and merchants depends, and upon which wc can again rebuild the eminence which wo enjoyed and received from our fathers.” Continuing, Mr Norman said: “ There is one other point which refers to bankers whose business lies largely overseas. They have, to my knowledge, been generous lenders on short credit overseas. They have done this each for themselves and without any cooperation or any knowledge by one of what the other was doing. “ The result has been that in many instances, some of which have come before me, concerns have been able to borrow on short credit sums which, had the various lenders been aware of it. would have been quite out of the question, and which have come as a surprise to all of them, both in this country and abroad. ‘‘ L wonder whether that cannot be done in future on some basis of general co-operation to the interest of all? “ ONE STEP ENOUGH.” “ I believe in the old motto that ‘ United wc stand, divided we fall.' 11 In spite of every attempt that lias been made —mostly in isolation to a large extent —the vast forces of the world, the herd instinct, the desperation of the people who have neither work nor market, have brought about a series of events and a general tendency which appear to me at the present time to be outside the control of any man, of any Government, of any country. ‘‘l believe, that if every country and every Government could get together and act together things would be different. But the? do not seem to be able to do so. Therefore, 1 am driven to the conclusion that wo must lake for the moment the short view, though wc must plan long. For most of us it is ‘one slop enough for me.’-

The difficulties are so vast, the forces are so unlimited, precedents are so lacking, that I approach the, whole subject in ignorance and in humility. It is too great for me, but I am willing to do my best. “ Some are able already to point out the light at the end of the tunnel. 1 myself see it somewhat indistinctly. Different directions are pointed out to us, all of which 1 hope will lead us to where we wish to go. But I will admit that for the moment the way, to me, is not clear. We have not yet emerged from the difficulties through which we have been passing, but 1 like to think we shall meet here next year and that this will continue to be an annual gathering. Then I believe it to be more than likely we shall see clearer where we are going and be sensible of the rapid pace at which we have been proceeding.” ECONOMY NEEDED. The Minister of Health, responding to the toast of “ Continued Prosperity to the Public Purse and the Health of the Chancellor of the Exchequer,” proposed by the Lord Mayor, said: “ No one can say exactly what the future of the pound is likely to be, either in the nearer or the remoter future.” What can be said is that we could prudently return to gold only when it was made clear that the gold standard was going to work properly. We must have a rise in the general value of wholesale commodity prices to a height more in keeping with the level of cost and an adjustment of the factors, political, economic, financial, and monetary, which have caused its breakdown in many countries. "it is essential that all wasteful and unnecessary expenditure should be cut out, and that money should only be spent when the fullest value can be obtained, having regard to our financial position. The more the Government and public authorities can save by reducing rates and taxes the more the ratepayers and taxpayers will have at their disposal , for the wise spending, that the controversialists demand. “ Some observers have seen in the development of recent weeks strong indications of a turn in the tide and a new spirit of confidence, or at least of hope, has appeared in more than one quarter of the world. Before the day breaks, as assuredly it will, there may well he false dawns, but the temper of this nation equips it to lead the way toward the goal.”