THE New Zealand Herald AND DAILY SOUTHERN CROSS. FRIDAY, MARCH 22, 1895.

New Zealand Herald, Volume XXXII, Issue 9774, 22 March 1895, Page 4

THE New Zealand Herald AND DAILY SOUTHERN CROSS. FRIDA Y, MARCH 22, 1895.

Judging by editorial comments and by expressions of opinion in correspondence, the mission of Mr, Moreton Frewen to these colonies on the subject of bi-metallism has not been conspicuously successful. And yet he had very much in his favour, It is true that we find ourselves at the present time in a very embarrassed position. This will be seen at a glance when we say that our chief staple is wool, that we borrowed largely when wool was about Is 6d, and now we have to go on paying interest when wool is »bout 6d or 7d. That is a specimen of what lias happened to our principal articles of export. And now Mr. Frewen, vicepresident of the Bi-Metallic League, comes to. us and tells us that the low range of prices has been caused by mono-metalhsm, and that if silver were to be coined without restriction at a certain ratio to gold all our products would rise in price. Never was any community more disposed to receive a new currency gospel. But still we are incredulous. At the meetings addressed by Mr. Frewen, resolutions were carried to the effect that the colonies should be represented at the approaching Monetary Conference. The Government is at present considering whether they should take steps, in conjunction with the other colonies, to secure such a representation. There are many reasons why the. colonies should be represented, although we do not anticipate that their being present would make any difference in the final result. The colonists of Australasia see many efficient causes for the low prices of their staples without resorting to the obscure explanations which the . biuietallists urge. Trade has been dull in the United Kingdom, and the expansion of the manufacturing trade there has not proceeded at the pace of former years. The means of communication all over the world have been vastly improved, cultivation has been extended into the most remote quarters, new countries which formerly did not enter into mercantile consideration have become large producers; and all have conspired to pour their products into London as the only entirely open market, and the great emporium of commerce,,

It is no doubt if Mating to us to have to part with thffie bales of Wool for the pries which we fß?ffifeWy peeeivea' farone, but it has not been made evident to us that mono-uietallism has caused the fall in" JJficJe, and that bi-raetallism would result itt a rise. As to the debts which we have so rashly incurred we cannot cast the blame elsewhere. We have all aldlig actfed wrMgly* and are doing so now. Each Of these loans was when first incurred furnished with a sinking fund, and if these had been allotted ! to* go on accumulating ' we should, by this time, have been relieved of a portion of our liabilities and have been better able to face the lower prices. But about 15 years our politicians discovered that sinking funds weM a mistake, and Were" nob in accord with advanced financial science. Therefore an arrangement was made to seize the (sinking fund, and to convert the loan into permanent debentares at a somewhat lower rate. The conversion operations cost a considerable sum, and our debt was Wade permanent. In view of the steady appreciation of gold, or rather the fall in the value of OUf products, this Was a mistake, but then the compensation was that each set of politicians coming into office had every year the Opportunity of "collaring a Considerable sum as released sinking fund. For instance, last year the amount taken to adcOUiit amounted to £284,600; There is no possibility of stopping the process, and of re-establishing the sinking funds to reduce the debt, for every Colonial Treasurer is eager to obtain as large an amount as possible from loan* conversion and released sinking fund. BUt the process has been a mistake.

We doubt very much whether the proposed Monetary Conference will make any change in the currency system of the world. The last Conference met at Brussels, in 1892, and at this the principal European countries and the United States were represented. The United States made proposals to arrive at an international agreement for the free coinage of gold and silver, and for fixing a ratio between the two metals. On this question the United States has a large immediate interest), apart from the permanent policy or impolicy of bi-metallism. She is a large producer of silver, which she wants to sell to the rest of the world at a high price, and she has an enormous quantity of silver stored, which the political "silver interest" has compelled the Government to purchase at about 47fd per ounce, the present price being about 27d. The proposals of the United States were favoured by several countries, but were rejected by the Conference as a whole. The Indian Currency Committee, which safe subse* quently, recommended the closing of the Indian mint to the free coinage of silver, practically making gold the standard of Indian currency. Everyone can see that if the Monetary Conference which is about to meet agrees to the rehabilitation of silver as a standard coinage, the immediate gain to the United States, and some other countries Would be great. But We in the colonies cannot perceive how we should gain, or how the rehabilitation of silver would necessarily cause a rise in the price of wool. The colonies are not likely to take a very active or feverish interest in this question of bi-metallism. There is no general conviction here that the fall of prices of our commodities has been caused by the adoption of gold as the standard of value.