SANCTITY OF CONTRACT.

New Zealand Herald, Volume LXIX, Issue 21129, 11 March 1932, Page 12

SANCTITY OF CONTRACT.

Sir T.N., m his letter of jLj, 2, speaking of the relative sacrifices nj by the various classes during the u period, says: "The wage and sa ] " earner made his sacrifice through the fs that, there was a substantial lag j n J* adjustment of wages and salary to th higher retail prices, just as the recipient of fixed income made his sacrifice bv th reason of the fact that no adjustment of interest could be made till maturity of the contract." Long-term contracts, j n respect of interest, have a currency 0 f from 20 to 42 years, or even l on « r therefore the man who held these securi' ties in 1914 continued to make the sacrifice after other incomes were adjusted to the various rises and will continue h'j sacrifice, even if the sanctity of liis cotitract he preserved, until the other incomes, wages, salaries, rents, etc., ar« brought back to the 1914 level or maturity of his contract. I notice that "P.N" says that I am quite wrong in mv statement, "that during the war thousandspjt their savings into war loans," and quotes the relative amounts at over 4 and 5 per cent, before and after 1914, while he carefully ignores the amounts, at a low rate subscribed during the same period I am acquainted with numbers of people, many of them eld, who put all their savings, sums ranging from a few hundreds up to a thousand pounds, into these loans, which were then regarded as a safe investment, and today are struggling to exist on the inccnw from this source. Dees "P.N." consider that any Government has the right to still further impoverish these people, many of whom are of the wages and salary class! Honour Thy Bond.