BETTER TONE

Hawke's Bay Tribune, Volume XXII, Issue 221, 1 September 1932, Page 4

BETTER TONE

BANKERS AND OTHERS AGREE RELEASING FUNDS FOR INVESTMENT. MARKET MORE CHEERFUL. ' Chrlttohuroh, Aug. 30. A marked disinclination to risk money in speculative investments still exists with the investing public, but lately a very much brisker lite has coihe to the market in investment in the better class of stocks, inquiries showed to-day. Bankers and others agreed that the general tone was more promising than it had been for a considerable time. Most of the authorities Seen were inclined to discount a suggestion that the Ottawa Conference was influencing the average investor to any great extent, and admitted that, while greater confidence was evident, they could not trace its source.

One bank manager said that people who formerly were in the habit of Investing In good stocks, but since the slump began had preferred to place their money on fixed deposit, were at last beginning to release funds again to investment.

“I can’t define the present position,” remarked the manager. “I know that the trend is upward—but it’s more of a ‘hunch’ than anything else with me. Confidence is a well-used word, but it is the one that fits the situation. There is more confidence. Where it springs from I don’t know.”

Fixed deposits with the banks offer a safe haven for surplus funds in difficult times, at a comparatively low rate of interest, and it is to fixed deposits that potential investors have been turning. Fixed deposit# are still largely in favour, but evidence to-day conclusively showed that holders of fixed deposits are beginning to look toward the stock market. “If the new movement is maintained, it will give a big forward impulse toward recovery all round," it was stated in one quarter. A holder of large fixed deposits in one of the banks has told the accountant of the bank that he intends to look about for suitable stocks. Brokers said that a noticeably large number of clients were pcopfe ilffio were withdrawing £lOO to £3OO from fixed deposit, or from the Post Office Savings Bank, for investment. The trend was nbt toward the speculative type of investment, of course. , “I agree that the outlook is more cheerful, but at the same time the public must accustom itself to lower rates pf interest than those which ruled in the past,” said a broker. “So far, the public has not done this. Tb;re have been compulsory reductions in inbut not enough independent assistance for the movement. Investors nc’. irally look for the largest return for their money, but it must be under-stood-that 5 per cent, is’a fair rate. s “I don’t think that average person is paying much atfention to the possibilities opened up. by the Ottawa Conference when it cornea to contemplating the release of money to investments., The movement has another origin, in my opinion—perhaps people are becoming tired of the comparatively low rates of interest offered by fixed deposits. The general public is taking more interest in, for instance, the encouraging forecasts of the new season’s wool sales in Australia than in what happened at Ottawa."