FINANCE STOCKS AND MINING

Free Lance, Volume XVIII, Issue 957, 14 November 1918, Page 9

FINANCE STOCKS AND MINING

THE prospects of an early peace are favourably affecting the London Stock Exchange, and consols are now Avell over £61. Consols have ever been viewed as the barometer of the European situation, rising or falling as the outlook varies. They are the premier gilt-edged security of the world, and foreigners find safety in investments in consols. In July, l 91 4; in order to prevent Germany creating a financial panic by means of reckless selling of shares, which she was quite capable of doing, the Stock Exchange was closed until the end of that year. Subsequently a minimum price of £65 was fixed for consols, which lasted until. November, 1915, when the embargo was lifted and the security dropped to its true level, and consols were quoted at £58 10s to £59, rates fluctuating within a, moderate range.

• In October, 1916, consols tool? a •downward course, and in February, 1917, when the price dr.opped to as low as £51 10s. The flotation, of so much war stock returning over 5 per cent, kept consols at a level which gave a. yield reflecting the value of. money. Recently there has been a distinct upward tendency culminating; in the present comparatively high price which may still move upwards when the terms of the armistice are accepted by Germany.

The nearness of peace, which is generally, admitted, brings into prominence a consideration of the; conditions that are likely to rule when hostilities cease. So far as New 'Zealand is concerned, the future conditions aire 'certain to be as satisfactory and healthy as they are now if not a shade better. Meat, butter, and cheese for the current season, ahd for the .season following peace, which will most likely be the season of 1919-20, have been sold to the Imperial Government at present war prices. It is very probable that wool will be included in the list. It would be a calamity if it were not, and, as these four items provide us with practically the whole of our income, it can be seen that until about June or July, 1920, at the very earliest, the country will be enjoying its present high level of prosperity.

It may be eveii better, " because in addition to the commandeered products named there are a variety of other exportable products accumulated in store, which could iqe marketed during the year, and there will be adequate shipping available,, for every vessel bringing back our troops will be sent Home with -produce of one kind

and another, and the realisation of this produce will add to our income. So that, in point of fact, we should be in a financially better position during the first year of peace than we have been during the last year of war, assuming that the war ends before December 31, 1918.

In the eighteen months of the pence prospects, as outlined above, we ought to be. able to adjust our affairs to meet the inevitable fall in values which must result when the Imperial Government ceases to buy our principal products at fancy prices. There will be ample time also to make those preparations for industrial development which the times may demand, and to absorb into civil life the thousands of men who will be returning from the Avar zone.

There may be some difficulty in the labour problem, for it is not to be supposed, that, all our soldiers will revert to their previous occupations. In any event we shall be short of the men who have gallantly made the supreme sacrifice and of those incapacitated by wounds and sickness. Furthermore, it is not unlikely that a considerable number, having had the taste of adventure, may prefer to remain in Europe, where the demand for labour of all kinds is bound to be greatly in excess of supply..

It is problematical whether there will be any great influx of immigrants from Europe. Europe will need the services of every one of its units in the work of reconstruction, and, because of the shortage of labour, wages are certain to be at a . point to induce them to. remain in Europe. /The labour problem' is one of the difficulties that will trouble the Dominion for a few years after the close of hostilities, and female labour will probably be continued to be employed.

Underwriting has been very profitable in New Zealand during "the past few 5 years because there have been comparatively few conflagrations. This immunity cannot, however, be expected to continue, and we may look for an increase in fire losses. The losses in New Zealand are trifling to those in Canada, where the underwriters apparently carry risks, at' the highest ratio in the world per head of population. The Fire Wastage Commission, which has been enquiring into the subject, estimated the loss a.t 2.73 dols. per capita, a,nd it compares with 2.26 dols. in the United States, where the rate has always, been regarded as high, 64 cents in England, and 13 cents in Switzerland.

_ The' causes assigned by the Commission for this high proportion of loss are carelessness, faulty - construction, arson, and want of proper or properly enforced legislation. .The' Commission suggested,. as one remedial measure, that insurance agents should he remunerated partly at least on a profitsharing basis, whereby those who undertake good risks should be paid on a higher scale than those who take up bad or indifferent ones.

The larger drapery establishments have had a very trying experience during the war period, and axe still greatly handi'capped owing to the difficulty of securing suitable goods, and in some cases of obtaining goods at all. There have, been substantial advjuices in practically every line, and to maintain stocks at anything like a reasonable level the business capital lias had to be increased. Furthermore, these larger concerns are in a great measufo taking risks that do not come within the scope of. the smaller house. Notwithstanding all these many and varied difficulties, the D.I.C. in the last year made a. net profit of £22,884,/ an increase of £1300 over the previous year. This handsome result is a tribute to the management, and it is obvious that all the responsible officers from managers of branches to heads of departments have worked together with the best results.

The net. profits have been ascertained after providing for the enormously increased taxation , which constituted an/ actual liability. " The directors have added £4626 'to the reserve fund,, bringing that fund up to £66,000, and, adding th.e undivided profits, to £87,000. The dividend on the paid-up capital has been increased by 1 per cent., and the shareholders receive 8 per cent., and a war bonus of o per cent, on their salaries has been voted to the warehouse and office sta/Ts. The D.I.C. has subscribed £15,000 to the war loans., and propose subscribing a substantial amount to, the next loan.

There was a large yarding of fat Cattle at the Burnside : market, and although at the start prices tended downwards, tliere was a recovery before the sale" closed and prices were up to the previous week's level. Extra prime bullocks made ,£26 to £30 12s. 6d; best bullocks £23, to £25; medium to good £20 to £22; best- cows and heifers £17 to £18 10s. ; medium to good £14 10s. to £16 10s. ; others £11 10s. upwards. At Carterton fat cows realised £13 155., at Masterton £12; at Levin £12, and at Palmerston North £10 14s. to £ill 10s. At Westfield the prices were fat steers £1210s. to £25 2s. 6d, and cows and heifers, £8 10s. to £17.

At Burnsi.de the competition for fat sheep was eratic, but prices were on a par with the previous week. Extra prime wethers to 53s ; prime wethers 47 s to 50s; medium to good, 39s to 435; extra prime ewes 495; prime ewes 42s to 465; medium to good 39s to 40s; others 27s upwards. At Levin, extra prime fat sheep made sls; prime sheep 465; at Feilding fat ewes sold at 26s 6d; at Carterton fat woolly ewes made 37 s 6d; at Levin fat hoggets realised tip to 455. At Westfield the prices were: extra heavy prime .woolly wethers 46s 9d to 48s 9d; extra heavy prime shorn wethers, 37s 9d to 42s 3d; heavy prime woolly wethers 43s to 46s 6d; shorn 33s to 365; medium to heavy woolly withers 38s to 42s 6d; shorn 29s 6d to 335; extra heavy woolly ewes 38s to 40s 3d;, shorn 29s 6d to 32s;' good woolly ewes 35s to 36s 9d; shorn 25s 6d to 295. At Burnside best lambs made 30s to: 32s 3d; medium to good 25s to 28s; others 22s upwards. The prices at Westfield were best heavy lambs 25s to> 25s 9d; good lambs 19s 6d to 22s 6d; lighter 13s' to 18s.

At Levin porkers made 55s to 78s; at Carterton choppers realised £5, and porkers 37s to 595. At Westfield large choppers and heavy baconers made up

to £7 10s; small choppers and light baconers £4 to £5 15s; large porkers £3 10s to £3 17s Gel; medium £3 to £3 9s; small 47s 6d to 58s.

Investment shares are firm at full market prices', and it remains to be: seen what effect the cessation of hostilities will have on the concerns that have been working on war contracts. National Bank sellers £6 lis 6d; Bank of New Zealand, old, buyers £13 10a; new, sellers £18-12s ; N.Z. and River Plate buy.ers 395; Wellington Trust and lioan, buyers £5 15s; Christchurch Gas, buyers £5 15s; Wellington Gas (£10) sellers £11 12s 6d; N.Z. Refrigerating sellers £2 6s; Auckland Trams (ordinary) buyers 19s. ; Huddart Parker (preference), buyers 20s 9d; P. and O. Deferred Stock buyers £410; "Wellington Woollen (preference), buyers £4 16s; Waipa Colliery buyers 16s 3d; Kauri Timber (335), buyers 305.; Leyland O'Brien, buyers, 27s 6d; Golden Boy Cement, sellers, 19s 3d; Sharland arid Co. (ordinary and preference), buyers 295.

In the mining market there were sellers of Dominion 1 Developing, sellers 255; Talisman sellers 10s 4d; Waihi buyers 435; Grand Junction, sellers 16s 3d; Westland Gold, buyers, 395.