THE LAST LOAN

Hawera Star, Volume XLV, 2 July 1925, Page 7

THE LAST LOAN

WHY IT WAS RAISED. BORROWING FROM U.S.A. PROPOSAL NOT FAVOURED. WELLINGTON, July 1. __A statement an regard to the last £7,000,000 loan was made in the House to-day by Sir James Parr. Speaking in the Adress-in-Reply debate, the Minister stated that of the above amount £1,000,000 had. been .set a.side for houses for workers land £1,000,000 for advances on rural .securities to fanners. The balance of £5,000,000 was absorbed by public works and general purposes, including railways and telegraph construction (£3,500,000). railway improvements (£500,000), hydro-electric development (£500,000). and highways (£500,000). The Minister said it might fairly be claimed that the loan was a most successful flotation. The yield to the investor was £4 15s 3d per cent. Until the High Cbmtnisisioner supplied full details of the transaction it was impossible to state exactly within two or three shillings per cent, what the loan had cost the borrower. That information, no doubt, would be contained in the Budget. Mr. Sullivan asked: What is the cause of so much being left in the hands of the underwriters? Sir James replied that amongst the causes there was the very adverse balance of trade in the O'ld Country, the worst for twenty years, stagnation in big industries, and also there could be no question that the determination o.f the Imperial Government to restore the gold istandard had resulted in the banks deciding to keep their money in Great Biitain, and that had helped to restrict the. Dominions in their borrowing in London. Also there could be no doubt that a vast number of issues of loan capital in the last three or four years to all sorts of people outside the Empire had conduced to. the present dearth of loan money in. Great Britain to-day. Dealing with the suggestion that the Dominions .should borrow money in America, Sir James Parr said this course bad obvious disadvantages. It was poor business always to borrow money from a, country which did not take our goods. In the last result we paid our interest in goods. The American people diet not take our wool, butter, beef, and so forth. They were hostile, and our goods were shut out. There was little doubt that London was considering the rationing of Dominion applications for loans. He hoped our security would always '.stand so high in London that we should get what- we wanted without having to gr outside the Empire, Failing that, be was .sure our own people would find some portion of our loan requirement'., at a fair rate of interest, should it be necessary to ask them to do it, but we should get our money in the Empire.— Wanganui Chronicle."