FINANCE STOCKS AND MINING

Free Lance, Volume XVI, Issue 849, 13 October 1916, Page 8

FINANCE STOCKS AND MINING

THE banking returns for the September quarter show very clearly that New .Zealand lias enjoyed exceptional prosperity during the past year. The Government deposits increased by £2,571,866 and total £5,159,239. Part of this increase is no doubt . due, to increased revenue, but probably-the greater part of the expansion is due to the loan recently floated, the first instalment of which would have come, into the September quarter. The free deposits increased' by £2,074,808. and the fixed deposits by £1,369,563. When it. is remembered that fully 25 per, cent, of the loan was paid, the increase in the deposits shows to what an enormous extent the country has benefited by the high prices, ruling for produce. . - ;

The advances have increased by £1,257.913. and the discounts by £71,146. and this is a very fine "indication, for it goes to show that there are openings for the employment of capital. But the amount of accommodation sought from the banks is very small compared with the expansion in the deposits'.' Another very satisfactory N indication is the growth of the mote circulation, which for the September quarter amounted to £4,329,953, as against £2,822,809 in 1915, and £2,012,569 in 1914. Notes are now legal tender, and gold is very seldom seen in circulation. This would account for part of the increase, but the principal, cause, of the expansion is undoubtedly the better economic •'conditions, and the high cost of living which calls for more ready cash, to be in hand.

Although- the past year has been "very good, the current year will probably be better —provided the facilities for shipping produce are. not seriously affected. This is a matter that*, cannot be forecasted 'just now, but the probability is that fresh difficulties will crop up. More men is th_e call of the Allies, and more must, .go. -from, .the Dominions overseas. Not much fresh tonnage has--been" put into the water during the past twelve months, aaid that there is' likely to be increasing pressure is indicated by the fact that the people of Great Britain are urged .not to -import goods that are not absolutely necessary.

if there ,is going to be any -toiyiage difficulty, as no doubt there will be, then, so far "as., the Dominion is concerned, a check should be placed on the export of butter and also on cheese, ex-

cept what may" be required by the War Office. Butter may be classed as a luxury for the British people who can obtain margarine, and cheese is passing into the hands of speculatoi's who will no doubt endeavour to exploit the Army Commissariat Department. Preference in.shipping must be given to meat and wool, and not to cheese and butter.

For colossal impudence *tlie dairy farmers of New Zealand stand alone. For years the Dominion has been spending money freely in maintaining a Dairy Division in order to help along the industry. The dairy farmer has been coddled and- spoon-fed by successive Governments until he has become quite arrogant. The dairy farmers want the price of butter to be raised to 2s per lb retail in New Zealand, and if that is going to be the price at the beginning of the season then it is not too much to say that we will have to pay considerably higher for our winter "butter.

There is no warrant for any such fancy price as 2s per lb, for the reason there is no scarcity, and the- cost of production. is only slighter higher- than it was. It is quite true that prices are high in London, ! but the trouble is to get the butter to London, and if butter did get to London in any volume values would slump. The London parity is just a clever excuse on the part of the speculators to squeeze more profits out of the ' public. The marketing conditions of the dairy industry have always been peculiar, the advance without -recourse being, about the most stupid method of / dealing.

Not only do the dairy farmers want the price of butter raised to 2s per lb retail, but- they also object to an export tax, and obviously they do not want to pay the cost of upkeep of the Dairy Division. In point of fact, the. industry which has'been spoon-fed at the expense of the public is now dictating to the public, and the' politician chasing votes wil] tell us it is necessary to help the struggling dairy farmer. It is really time the dairy farmer and those hanging on to nim were put into their place.

Th© Treasury should, or rather could, reap a rich harvest by increasing 'the war profits tax. The Australian Government are not dealing gently. with the makers of war profits, and there is noreason why they should be any differently treated in New Zealand. The huge profits mostly come from exploiting the" public, and the public should get back all" or most of this war profit through the Treasury. At all events, the dairy industry, which to-day is the most profitable industry in New 'Zealand, should be forced to contribute very heavily to the Treasury.

The outlook for wool seems favourable, and shearing has already begun in many localities. The Allies will require considerable quantities of wool, and every facility must'be given for the export of the - It is not expected that any

difficulties will arise during the current quarter, but in January and February, when the bulk of the clip comes to hand, there is bound t-o be trouble. So far as our export trade in produce is concerned "the shipping problem is going to be a verv difficult one to solve.

The issue of 6 per cent. Exchequer bonds has greatly disturbed the market, for gilt-edged securities. All Colonial Government stocks have declined, and the fall in some cases has been rather heavy. Thus New Zealand 3 per .cents, fell £4 10s. and South Australian 3 per cents, were lowered by £3 15s. Exchequer bonds are as gilt-edged as any of the other securities, and 6 per cent, thus becomes the regulating rate; all gilt-edged securities must conform to this rate. After two years of war the credit uf the Imperial Government is on a 6 per cent, basis for short loans.

The Imperial Government has only issued f.wo flat loans, one at 3V per cent, and the other at per cent., and has not reverted to this form of harrowing. Treasury bills. Exchequer -bonds, War Loan certificates and revenue have contributed to the funds necessary for carrying on the war. Recently there has been a falling off in the subscriptions to the Exchequer bonds, while there was a tendency to expand in Treasxiry bills, and it was to rectify this that the issue of .Treasury bills was stopped and Exchequer bonds made more attractive?

The balance-sheet of the South British Insurance Company, Ltd., for the year ended August 31st, 1916, shows that the premium income amounted to £538,799. The losses totalled . £296,038, and "the expenses £171,537, leaving the underwriting profit at £71,'224. The income from interest and rents totalled. £43.511, making the total available £114,735. This has been dealt with as follows: —

Added to reserve fund, £40„000; written- off investments, £21,268; Auckland leasehold sinking fund, £200; London leasehold sinking- fund, £225; contribution to officers' provident and snparanuation .■ funds, £4532; dividend at the rate of 4s 6d per share, or 15' per cent., £45,000, leaving a balance of £3510, and there was brought forward from the previous year £48,119, so that the unappropriated balance carried to new account is £51,629.

Among the assets held by the South British Insurance Company are loans on mortgage, £272,440; deposits fixed and at call, £66,000; stocks and debentures, £48,796; municipal and harbour board debentures, £87,791; Governmentstocks. £70,320; Imperial War Loan, £99,840; Exchequer bonds, £75,000; New Zealand War Loan, £100,000 (first instalment £25,000 paid)-; cash in bank and bills in transitu, £87,398; balances at branches and agencies, £103,711; bills receivable, £4461. The Company is exceptionally strong financially, and is doing a sound and profitable business under able management.

Although meat is commandeered there are no petitions ancl applications to the Government to permit of retail prices being raised, as is tlie case with butter. The conditions governing the two industries are .widely different. They are fairer and sounder in the meat trade. Values of live stock rule high. At Palmerston North, fat cows made £9 10s to> £11 ss; at Feilding, £10 lis to £12 ss; at Rongotea, £11 2s 6d to £11 17s 6d; at Feilding, fat heifers realised £8 15s to £12 15a. At Addington, the prices were: P.rime steers" £12 10s to £21 12s 6d, ordinary steers £9 10s to £15, extra prime heifers to £17 2s 6d, prime heifers £12 10s to £15, ordinary heifers £7 2s 6d to £12, extra prime cows £15 15s. prime £10 10s to £13 10s. ordinary £7 to £10. At -Burnside, extra prime bullocks realised £25 ss, prime £17 10s to £19 10s, medium £15 10s to £16 15s, light £12 to £15. prime .heifers £14 to £15 10s, medium £11 to £12 ss. light and unfinished £7 to £9 10 s.

At Fe.ilding.heavy fat ewes- soldraifc"; 40s to 40s 6d;-at Palm'erston North, rat;; 38s 3d to 395; at Rongotea, fat ;• made 31s. and at Konini,. fat wethers J ; : realised .39s 6d. At Aiddihgton. prime sold'at. -f6s : '6d. prime 32s 6d to 42s 6d". others 29s to ; ;325, primps ewes 32s 4d to 375, others 24s 9d to'29s, >? hoggets 22s 6d to 295/ new season's-:' iambs best 28s to 345, lighter 20s tb; 275.:® At Burnside, the prices obtained were'::.; Extra prime wethers' 44s 9d, prime 34a-to-38s. medium 30s 6d to 33s 6d, light and. unfinished 25s to 295, extra prim©ewes 35s to 38s. prime 29s to : 31s ~6dy~ v medium 25s'6d-to 27s 6d, light 245, extra. prime lambs 34s 6d, medium 2§s to30s. ' . " : ' '"" '-' " * * " .... At . Konini. porkers sold at 4os to-,.. 475. At Addington, choppers £4 to£7*; ; extra heavy baconers £5 8s 6d. heavy, baeonei s £4 15s to £5. light baconers» £3 r ; - 15s to £4 10s, heavy porkers 55s to 605,,.. lighter 48a to 50s. ; ■» «• « At the Westfield (Auckland) sales fat;--steers sold at from. £13 to' £24 as, cows and heifers at £7 10s to. £16 7s 6d.. Best woolly wethers 41s 9d to 48s 6d, others 36s 9d to 40s 9d, best shorn wethers 31s to. 33s 9d, others 28s to 30s 6d, best;-,, woollv ewes 37s to 445, others 33s_ to 365. 9d. shorn ewes best 28s to 39s 9d, others l ,. - 26s to 27s 9d. woolly hoggets best 32s r 34s 9d, others 28s to 315,-shorn hoggets; 18s to 335. Medium baconers £3 lis to£4 Is,. light , ba,con,ers £3 3s to £3 10s, : hea.vv porkers £2 14s to £3 Is, medium £2 7s to £2 13s, light- 38s to 465. slips 24s to 335. weaners 15s to 235. - —;? * * - * '*7The investment market _is rather-:; Quiet, and few sales are being made. : There appear to. be more sellers about, • but- the prices quoted are the extreme:' National Bank, sellers £5 6s; Wellington Investment, sellers 10s 9d ; Welling- 1 ton Trust and Loan, sellers £7 ; Gear • Meat (£1), buyers £4 10s : Meat- Export (355), buyers 395; N.Z. Shi oping,-buy— ers £10 10s; Union Steam (ordinary), sellers 455; Hudda-rt Parker' sellers ,26s 6d; Wellington Woollen (ordinary), -.sellers £6 ; Westport •_ Coal/' sellers 29s 6d; N.Z. Consolidated Dental, ' buyers 22s 9d; N.Z. Drug, buyers 465 : -6d; Golden Bay Cement, sellers 21s 6d. lii the mining market there has'beennothing doing recently. Talismanswanted at 9s 3d, and Waihis at 3/s 3d. Grand Junctions were offered® at 17s 6d. - . ■