The Guardian And Evening Star, with which is incorporated the West Coast Times. FRIDAY, DECEMBER 1, 1933. A FINANCIAL MAZE.

Hokitika Guardian, 1 December 1933, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times. FRIDAY, DECEMBER 1, 1933. A FINANCIAL MAZE.

The world is gradually obtaining an insight into the wonderful ramifications of finance l , and leaning something of the intricacies of the finan-

cial game—into which the handling of international finance has rather developed. The high masters must have had some inkling of what was to come, when, at the London Conference, there was the demand for stabilisation of .currencies as a primary means to economic world recovery. The United States was the dissenting nation at the time, and a flood of light has been let in on the position by the cabled statement made this week by Professor Molev, who at the World Conference, was the mainspring of the American decision. The Professor believes in playing the financial game to his own delight, and thinks because Britain has had the privilege of fixing the price of gold over a long period, the United States might have a turn, and so participate in trade which Britain managed to wrest from America. This revelation of the promptings behind the great minds of finance in the United States, is interesting, as disclosing some of the niceties of the financial game. No doubt Britain reaped a benefit financially when the dollar dropped equal to' 6s 6d in the £, and if England bought, in anticipation of the eventual rise, the transaction would assist when the next debt payment is made this month. The dollar is now ab(P"j pat with stealing and so will go much further financially, but the margin between the low price to wluch it slumped, and the present price to-day, wild show the greater profit. Just what a maze has to be traversed when dabbling in high finance is here disclosed, but those who venture must needs have a good idea of direction, and know the way out without incurring disaster. Britain has always kept her counsel in financial affairs, and that degree of secrecy is a necessary factor in ultimate achievement. The position of world finance to-day and the standing of Britain in regard thereto suggests that the British financiers are doing their business with a. full knowledge of their task and its intricacies, is regards the national finance of Great Britain, on behalf of the Midland Bank, it is being put forward that the Government should not reduce the floating national debt by any funding operations. The- debt is covered by the issue of Treasury Bills, the handling of which is “an integral part of the mechanism of hanking security and provide in addition a quality of elasticity without which the banking system would not operate smoothly or with maximum efficiency.” It is pointed out that the shrinkage of say two hundred millions in the quantity of Treasury Bills outstanding, would reduce the available supply of hills to a level that would place the banking system in. a n impossible position! This reveals the nicety of the money j situation. The hills referred to create ! the class of credit best suited for i banking operations. If the hills were not there for hacking, actual money values would have to be substituted, and that hoarding would create a degree of deflation which might be disastrous. This insistence of possibilities shows the ramifications of finance, and the service sound paper money can j„ the presentation of banking credit. 'So we, have another example of the maze which involves right fihnnro mid its manipulation to the advantage of any country. The wisdom of wise foresight and sound judgment as to possibilities of the course of events, is therefore a great banking asset.