STOCK MARKET SLUMP.

Hawera Star, Volume XLIX, 5 November 1929, Page 7

STOCK MARKET SLUMP.

SOME LOCAL OPINION

WILL. HISTORY REPEAT ITSELF :'

Many "ho have been in close touch ■with the financial history of the Dominion for the past 2o years will recall the backwash of a hnanenvl c >sis in New York felt m New Zealand m 1908. It was nearly twelve, months on its way, but it reached these shores with a thud, and property and security values were depressed. A\ df history i - neat itself:" This was the question put bv a representative of “The Wellington Evening- Post” to several authorities when discussing:: the collapse ut values of stocks and shares m New York. Generallv, flm opinion was expressed that New Zealand was too remote from London and New York to obtain a clearer view of the situation than the Press dispatches afford, but it was agreed that the depression in New Zealand in 1908—from which there was a speedy recovery—was certainly connected with* acute financial stringency m I New York and the collapse of the securities markets. Sir Harold Beauchamp thought the I present situation called lor the closest vhdlan.ee. But New Zealand "as in the happy position at the moment of havin'.- plenty of money seeking imexcept ion able investment at exceedingly low rates in comparison with those ruing elsewhere —in Australia and London, for instance. Of course, the margin must he ample : but the rates were exceedingly low. This condition was highly favourable to the Dominion should there be any reaction to the. crisis in New York. His own opinion —and it was shared by other authorities—was that the. losses referred to in the cables were not to be regarded as national in character, but a. matter ol out of one American pocket into another American pocket. The losses, he thought, would he someone’s gam So far as England was concerned, he thought the raising of the bank rate had had the- effect intended by the directors. namely, stopping the efflux ot avoid. That was evident, as he read it, m the I’nite-di States dollar rate of exchange, sterling being now above par. The New Zealand export season, too. had begun and the first cargoes of dairy produce were arriving and would assist in providing money in London. He did not think there need! be any apprehension in New Zealand at the moment as to increased rates lor money. ... , Other opinions elicited were to the effect that it was probable the London Stock Exchange would reflect in some do«Teo the present state of affairs m Now York. There were very (substantial holdings of American investments in England and much English money was invested in American enterprises whose shares might be severely depressed in price in the wild rush made during the past week or so to- sell shares] at any price they would fetch. But one could do in New Zealand on the information immediately available was to build surmises. It was agreed that America had had now eight years of unbroken prosperity. and eight years was a long lime. If present circumstances pointI i.o a change then juices of commodii• r „ would tend down wards and indirectly that might affect New Zealand's returns for all it had to sell m overseas markets. Time alone could fell. Conditions in the United States 1 day were different- and much more lavouiable to that country than they were in 1908. .Money, however, was clear in Loudon. a lid what was going on. in New York to-day would enhance its value. Australia and New Zealand it seemed would for some timb vet have to de-j |ren<| more or Jess upon their own fman-j cial resources. The atmosphere in New ( York must he lar clearer than it is. it was said, before any improvement in the monetary situation in London could be expected. Other than general observations were out of tile question with the meagre j detail's available.