RATE OF EXCHANGE

New Zealand Herald, Volume LXIX, Issue 21349, 25 November 1932, Page 15

RATE OF EXCHANGE

Sir, —In my opinion drastic measures are necessary at once. It is not a matter for banks or any other financial institution to be consulted. Mr. Forbes and party are supposed to be in power to administer the affairs of this country, and it is high time they did something to give the farming community a fighting chance to carry the country through the present crisis. One could bring many arguments for and against raising the exchange level, but one outstanding fact remains, and cannot be side-tracked, we cannot compete so long as Australia has the wood on us in price-cutting, and, make no mistake, they will not lower their rate while they have the said advantage. The only remedy I can see is fight them with their own weapons; bring the rate of exchange level with Australia. J. Bond, Warkworth. Fanner.

Sir, —To-day one can almost pick a man's view on the above problem when one knows his trade. Take, for instance, the importers' opinions as recently reported ju the Herald. I venture to suggest that not enough is said of " What is best for New Zealand as a whole." While we, combined as nations, as trades, and as individuals, consider only our own interests, just so long will we continue to drift from bad to worse. To prosper individually we must pull together for the good of the whole, not only for our own sakes. In the main, is not the present lack of prosperity in New Zealand due to the fall in total money received for exports'! But what farmer or individual is going to continue, let alone increase, the production of exports which is done at a loss ? We, collectively, could, if we wished, make country pursuits more enticing and profitable than city ones, and I venture to say that unless we do no Government has a" hope of getting people into the country to produce exportable commodities. Australia, our chief competitor in butter and fat lamb exports, is reported to have already this season increased her butter exports by one-fifth more than last year. For New Zealand to compete in tlie same market our farmers must have the same costs of production, which costs should include a 25 per cent exchange, or bonus on exports. If our cities want to be more prosperous, importing and selling goods and services, should they not boost for a higher exchange, which would have to be coupled with a lower customs tariff to fit in with the spirit of Ottawa. Many city men agree that something will have to be done very soon ; is not. a higher exchange a better, cleaner, and more straightforward method of stimulating exports, rather than wage cuts, mortgage extension Acts, superphosphate subsidies, interest rate cuts, increased income taxes, and other taxes, etc. To-day nobody knows where they are, and merchants, as a result, build nothing, lend nothing, nor sell nor buy anything where there is a risk with the result that the position daily is gradually becoming worse. A definite policy statement from a strong Government, which was adhered to, would greatly help matters. E. W. Yateb.,