The Hawera Star. THURSDAY, JULY 31, 1930. AN IMPROVED TRADE OUTLOOK.

Hawera Star, Volume L, 31 July 1930, Page 4

The Hawera Star.

THURSDAY, JULY 31, 1930. AN IMPROVED TRADE OUTLOOK.

Delivered every evening by 6 o’olook in Hawera, llanaia, Kaupokonui, Otakeho, Oeo, Pihama, Opunake, Normanby, Okaiawa Eltham, Ngaere, Mangatoki, Kaponga, Awatuna, Te Kiri, Maboe, Lowgarth, Idanutahi: Kakaramea, Alton, Hurleyville Patea, Whenuaknra, Waverley, Mokoia, Whakafnara, Ohangai, Mereinere, Fraser Road, and Ararata.

Recent cable messages have reported a London newspaper’s statement that in the opinion of the expert members of the Cabinet Committee on Unemployment the end of the great slump is in sight and an early trade revival possible. If this is well-founded, it is the most cheering news in many months, and not far from being the most important. But although there is reason to believe that the present stabilising of trade and industrial conditions precedes tlio return of confidence and a ;period of gradual expansion, it would lie foolish to hope for a rapid or abundant recovery, and foolish above all to

wait, for recovery, or to behave as if it were hero already, instead of working harder to make it real and lasting. There have been many misleading signals which have caused some people who would rather deal in sentiment than in facts to cheer prematurely. False encouragement like this, as the “Now Statesman” said some months ago, ‘‘even if it does cheer the patient “up for a time,” can be a “positive “ dis-service. ” Even now, it is the evidence of deep depression that leapt to the eye. The British unemployment total has risen almost to two millions; the cotton industry is in a miserable state; the wool textile trade has been disorganised; iron and steel have been badly hit; and as recently as a few days ago a message reported the decline in shipbuilding. There is much, however, that points to the possibility of a trade revival. On the one hand, though metals are uncertain, tlie price levels of most of the raw materials and food-stuffs appear tit have steadied, and steadiness, even at a low level, is better than downward movement. If we look for indications of' a gradual rise, we find them in several directions. Money is cheap in Great Britain, and the recent organisation of the banks and financial houses to assist in the reconstruction of industry will ensure the provision of capital where it is needed and deserved. Further, the concerted reduction in bank rate, which came during the conference of Europe’s Central Banks in May, was probably intended to indicate that the Bank of International Settlements will at once

begin to act as a co-ordinating influence. in the world’s banking and credit. Again, the effects of disastrous | events such as the Wall street collapse and the Hatrv failure have begun to wear off; and Mr Snowden softened his Budget exactions from industry with the fairly plain assurance that it now knows the worst. But while this roughly describes an economic position from which it is reasonable to believe that the next step must be forward, it is necessary to remember lliat recovery from a slump so widespread and severe is not likely to be anything but gradual. How severe and how widespread it has been—and is—it has been difficult for each country to realise, the attention of each being concentrated on its own distresses; but Mr .T. M. Keynes lately spoke of it: as “a slump which will take its place in “history amongst the most acute over “experienced.” Within a year world •wholesale prices have fallen by 12 per cent., and between January and May

l>y S per pent. “Apart from Ilio slump, “of 1921-22 one ran go back seventy “years without finding anything to “ocpial it. The collapse of prices has) “been more rapid and has proceeded! “further than, for example, in 1907.'k

Mr Keynes, an economist. Who 'never allows his wish to become the father of his thought, hopes to see new enterprise arid capital development stimulated and fertilised by cheap money, which, though the bank rate signals are in favour of it, he considers to be largely immobilised by the want of international co-operation in lending, by the fact that so much money is wanted to repay existing indebtedness, and by the piling up of redundant French credits through the Reparations Loan. But with this last out of the way, and the demands for repayment loans worked off, the trade position will be improved, he suggests, by the increased application of “new money, “in the sense that it is intended to “finance neve capital development."