RESERVE BANK AND POLITICS

New Zealand Herald, Volume LXXI, Issue 21921, 3 October 1934, Page 15

RESERVE BANK AND POLITICS

Sir—T am sorry T cannot follow "Barrister's" argument when he tries to explain what he means liv the term, "Tving New Zealand currency to storlinjr " an expression so often uaecl by advocates of inflation. "Barrister s explanation is that, when we were issuing silver coins in New Zealand struck from the same die as those used in Great Britain, this tied New Zealand currency to sterling, and, as we were using these coins in New Zealand, tins policv kept the wages and incomes ot the New Zealand people down to the level of those in Great Britain. But what about the notes which prior to August 1 were issued by six dinercnt banks and were not the same as those issued by the Bank of England. 1 am glad of this explanation from such an anthoritv as "Barrister," as J doubt if any better exposition of the term could lie given by anyone else, so now you know, and it is rio use wasting time discussing the matter any further. Those people who cannot see the advantage of maintaining standard weights and measures and standard units of value for weighing, measuring and valuing the commodities of two countries that have to he exchanged one with the other should set about a crusade of altering the yard stick, the ton weight and the imperial gallon to adjust the shortcomings of trade and industry internally, as there is as much sense in doing one thing ns in doing the other. I would impress upon "Barrister" that the New Zealand currency with the pound as its unit is only a measurement of value and only becomes a medium of exchange because it is a unit of value and it is neither if there are no goods produced or services rendered that require its services as a medium of exchange. 1 am not concerned with the quantity of New Zealand units of value so much as 1 am with their quality, as the quantity is automatic, but the quality assures equity and justice to all people who have to accept these units of value as the measurement of their service value in wages and incomes. J. Hislop.