The Guardian And Evening Star, with which is incorporated the West Coast Times. WEDNESDAY, APRIL 19, 1933. THE MONEY POSITION.

Hokitika Guardian, 19 April 1933, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times. WEDNESDAY, APRIL 19, 1933. THE MONEY POSITION.

In these difficult financial times it is some comfort at least to learn from the quarterly banking returns that the money position in the Dominion 'cannot be regarded with alarm. The -ugures for the March quarter reveal a generally healthy condition. Both the rvee and fixed deposits show an increase, combined, of over one million, the advances decreased by nearly a million and three quarters. While the Mote circulation increased by a small sum comparatively, coin and bullion decreased very substantially compared with a year ago, a fact not accounted for easily. Still with over six millions of notes in circulation, together with over live millions of coin and bullion, a large sum is in operaton, and actually the spending power of the community shows an increase—the first for three years—of nearly £600,030, which is a movement in the right direction. The public, too, is providing large sums in deposits for the banks to operate on. The free deposits have increased now to nearly seventeen and a half million, while the- fixed deposits are over thirty-five millions, or a total of over fifty-two and a half millions of money. This money is in general use, as the advances by the banks now total over forty-eight and a half millions, leaving -, a surplus of money in the banks -of dver four millions. One feature not too pleas-

ant to contemplate is the increase of the Government indebtedness to the banks, which is now over nine and a half millions, compared with over six and ...a half millions a„ye<nr ago—an increase of over three millions in the floating debt to the banks. This debt is covered by Government securities, which have to he redeemed, and meantime bearing interest. ■ Naturally the Government is a good customer for the hanks, in that tltp ‘security has giltedged hacking, but it would he more satisfactory as betiding to prosperity, if business, and development generally were, using this available money. Now 'that money is being cheapened through various channels, it may be expec/ted more of it will be used for new development work in the country. As pointed out above the excess of deposits over advances was over four millions on March 31, a very useful sum ,if put into useful circulation. Wo may take it that the hanks are exorcising extreme care in tlveir lending business, to accumulate so great- a surplus at such a time of general stringency. This may be overcaution, and tend rather to delay a return to more prospering times. But as custodians of the peoples’ money, the banks must exercise a degree of special core, or the country might experience a touch of the banking collapse which must have ruined thousands in the United States of late. In th.p, returns just published there is not any suggestion of any weakness nointing to a crash. Rather is it the other way about—the people a.i’-e more thrifty and their savings are mounting up, and the custodians of the money are using them circumspectly, ;;:nd with a margin of security which points to solid safety, and gives point to the well-worn saying: “As safe as the Bank.” This condition of affairs is very comforting at a- time when the financial matters of the world at large are so much upset and so generally uncertain.