NOTES AND COMMENTS.

New Zealand Herald, Volume LXIX, Issue 21110, 18 February 1932, Page 8

NOTES AND COMMENTS.

THE TROLLEY BUS SYSTEM. The experience of the London United Tramways with trolley buses (trackless trams) was described by the chairman, Mr. H. A. Vernet, at a meeting of shareholders in the company, at which an extension of the system was authorised. Mr. Vernet said that under the provisions of the bill promoted in 1930 about 17 miles of tramways between Twickenham and Kingston, Kingston and Wimbledon, Kingston and Tolworth, and between Surbiton and The Dittons had been replaced by a system of trolly omnibuses. The change from tramcars to trolly vehicles had received popular approval. The cost of operation per car mile was approximately 15 per cent. less than the average cost of running tramcars, due in part to the latter including the heavy burden of road maintenance charge imposed upon tramways. The t>-olly omnibus, however, paid for its use of the highway through the licensed vehicle duty—an amount of £B6 per vehicle per annum. ' The trolly omnibus sys'em had already proved its capacity to earn more revenue than the trannvav system which it had replaced. The board, however, was fully aware that this conversion had taken place in a favourable area for the purpose, for it was an area in which the traffic flow was more evenly distributed throughout the working hours of the day than was generally the caso on the rest of the tramway system. Mr. Vernet said the proposed extension of the system in the Tolworth area would be approximately 1500 yds. in length, and the capital cost, including vehicles, power, supply, etc., would not exceed £II,OOO.

BRITISH CAPITAL ISSUES. " The amount of new money, so far as can be traced, which was raised in the capital market of the United Kingdom in 1931 was the lowest for any year since the war," the Midland Bank Monthly Review states. " This fact, baldly stated, itself gives some indication of the general economic and financial conditions ruling throughout the period. But the depth of depression, combined with the low level of confidence among investors, can be gauged more accurately by a few figures. The 1931 total of £89,000,000 is only about one-quarter of the aggregate for 1928, the year of heaviest issues if tho wholly exceptional 1920 be excluded." It is only "34 per cent, of the annual average for the 12 years from 1919 to 1930. " The extremity of quiescence in the capital market was reached in the second half of the year, though each month recorded unfailingly a lower figure than its predecessor of 1930. The first six months yielded a total of £71,000,000. the second half only £18,000.000." Prophecy regarding 1932 is impossible, states tne writes. It depends on many uncertainties. " Among them the most vital is the question whether general confidence will improve or remain in the low state of the past year. And the answer to this question, again, will be provided by developments in the international sphere—negotiations regarding war debts, conditions in Germany and Central Europe, the course of gold prices and other trends—as well as by the passage of events at home —the budgetary situation, taxation, the balance of international payments, and so on."

AUSTRALIAN EXCHANGE. The assumption that Australian exchange rates are the result of a "free market" is refuted by a statement by Mr. E. C. Riddle, governor of the Commonwealth Bank, in a contribution to a financial supplement published by the Sydney Morning Herald. He says definitely that the rate has been "pegged" by the Commonwealth Bank to prevent its falling. Mr Riddle states that when the suspension of gold payments in Britain caused a general increase in commodity prices, sterling returns for Australian produce rose, and consequently the total of Australian-owned sterling in Loudon commenced to increase correspondingly. Also, people began to transfer funds to Australia. "The result was that the banks were being asked to buy London funds at 30 per cent, premium largely in excess of the amount they could sell," says Mr. Riddle. "The possibility of loss in this way alarmed the banks, some of whom threatened to cease buying altogether unless tlje Commonwealth Bank came to the rescue by buying their surpluses, and thus taking the whole responsibility. The position became so critical and the danger of collapse so great that the Commonwealth Bank, on December 2, issued a statement that it would buy London exchange, at rates to be fixed by itself, without restriction so far as the public were concerned, and subject to certain conditions, would also buy from the banks any surpluses accumulated by them." In conclusion, Mr. Riddle says: —"The bank has been accused of bringing down the exchange rate, whereas the contrary is the fact. In fixing a rate at which it was prepared to buy openly, the Commonwealth Bank fixed a rate beyond which the exchange could not, for the time, fall, and in this way was instrumental in preventing the collapse which must otherwise have occurred."