FORCED LOAN IN GREECE.

New Zealand Herald, Volume LXIII, Issue 19235, 26 January 1926, Page 9

FORCED LOAN IN GREECE.

SURPRISE FOR PEOPLE.

BANKNOTE VALUE REDUCED. GOVERNMENT AND HOARDERS. By Telegraph—Press Association—Copyright. (Received 7.5 p.m.) Renter. ATHENS, Jan. 24. The people of Greece awoke this morning to learn that, unwittingly, they have all become creditors of the Government by virtue of a decree which was issued last evening. This ordered a forced loan to be raised by a 25 per cent, reduction in the nominal value of the banknotes in circulation, except notes of a face value of £1 and under, and money deposited in banks. ' Banknotes will be cut into detached portions, and will eventually be exchanged for scrip in a loan of £521,000,000 at 6 per cent. There will also he annual drawings in which the prizes will be worth £420,000. The Government hopes thus to teach a salutary lesson to those people who have hoarded money and by so doing have helped to cause the present shortage of paper currency. , The decree was accompanied by a circular which explained that the object of the loan is to clear up the financial situation. The proceeds will he utilised for the redemption of the floating debt. The Premier, General Pan gains, in an interview, said the loan would avert the necessity for recourse to inflation, and would enable the people to save and so increase their purchasing power, and bo in a position to contribute to the restoration of the national finances.