AN EPIDEMIC OP BANKRUPTCIES.

New Zealand Herald, Volume XLIV, Issue 13487, 14 May 1907, Page 5

AN EPIDEMIC OP BANKRUPTCIES.

SOME OUTSPOKEN REMARKS. [by telegraph.—own CORRESPONDENT.] Wellington, Monday. Discussing , with a: .Times representative the increase >in the number, of bankruptcies in the Wellington province, a , merchant said: 1 "My own impression is that there ,is too much extravagance among the working classes. They get good wages, but they spend too freely on the totalisator arid other forms of recreation. Outside of Wellington you will probably find greater depression up the west coast than up the east. I have noticed this circumstance particularly for the last year or two. I have tried to find the cause of the difference, and think that it can only be due to the heavy mortgages that Manawatu farmers are labouring under. Land prices have been seriously inflated, and the east coast has escaped from that pestilence." . V Mr. Barkas, manager of the Loan and Mercantile Agency Company, thinks that so far as the outer suburbs of Wellington are concerned, under-capitalisation has been the chief cause of failures. "There has," he said, " been \ a tendency lately ,to rush into the storekeeping business with too slender / capital, owing to the impression that has got abroad that there is money in it. This has inevitably led to collapses." ■:■. Another merchant puts the ; blame upon the merchants themselves. : It is nearly all due to feverish competition. Not in prices—that would not matterbut in extended terms of credit.- It is very foolish for merchants to compete with,: one another, as I they are doing in that class of trade, but the practice is becoming very prevalent. Merchants do not make sufficient inquiries as to who a man is. Competition as to prices is; not so serious as competition for extended credit terms. Inducements, are eagerly held out to customers to buy costly goods, on deferred payment, and the result is that people become extravagant, and are finally unable to pay ; .their debts. Extravagance in shopping is increasing." - _"___