THE AMERICAN EXCHANGE AND NEW ZEALAND.

Marlborough Express, Volume L, Issue 81, 5 April 1916, Page 2

THE AMERICAN EXCHANGE AND NEW ZEALAND.

* The Mercantile Gazette of March 29 says:—Mr David Jones, at a meeting of the Farmers' Union, held in Canterbury the other day, advised the community to purchase as little as possible from the United States at the present time, as, he said, such purchases tended to depress the New York-London exchange, and added to the present financial difficulties of the British Government. Mr Jones also gave an additional reason, with which we have no space to deal in this issue. The Dominion's exports for the current year amount to about £30,000,----000, and after paying interest on our loans, and for our exports, there should be a very large sum by .way of balance in our favor. This money remains in England to the credit of our banking-institutions, who pay the farmer here from local resourcesl, drawing upon their balances in England whenever the necessity arises. Tho money is available for use in the Dominion if wanted on balance, or to be remitted anywhere out of London. If the advice of Mr Jones were folloWed, trade in this country would be stagnated. We cannot buy nails, galvanised iron, or motor cars, or hundreds of otlier things in England just now, and if we refused to purchase from America, many might just as well shut up shop. We should do all the business.we can, make-meney if possible, as by doing so we can best help the Empire at the present juncture. As to our purchases affecting the course of exchange between London and New York, to an infinitesimal extent they certainly increase the balance to be remitted, but we are quite sure if _ New'_ Zealand were to cease purchasing in America, exchange would not be affected by the millionth part of a cent. Exchangeis'against England, for three reasons; no Americans are travelling on the Continent, their drafts payable in London generally amount to many, some writers say one hundred millions per year, we are carrying co freights' for America, and we are buying very heavily in that country at prices artificially enhanced by German competitors, who are paying any figures to get what is wanted. As a matter of fact, a low exchange automatically prevents imports, and the British Government are not making any great effort to restore the equation. They do> not desire that more imports should come into the United Kingdom than they can help, and a weak exchange is an important ally. The _ reasons, however, which .make-it advisable to restrict imports just now into London do not apply to us. If we cannot import, both our revenue and our people will, soon be adversely affected.