TRUSTEES' DIFFICULTY

New Zealand Herald, Volume LXXII, Issue 22004, 10 January 1935, Page 5

TRUSTEES' DIFFICULTY

INVESTMENT OF FUNDS

THE AUTHORISED SECURITIES

EXTENSION NOT THOUGHT WISE

A natural outcome of conditions in the investment market at present is the growth of connected with the investing of trust moneys. Trustees are finding it verv difficult to secure suitable investments, *duo to the rise m the market prietf of most authorised securities, and only a small portion of the sums awaiting disposal can be dealt with.

Klsewhure, owing to the general practice of defining by law a list of authorised securities, the same difficulty exists and the question of reviewing the list and the procedure of investment was raised recently in the House of Commons. The official attitude was that a review was not warranted. The following comment was made by the Times: —"Apparently the revolutionary change in the money situation does not warrant a reconsideration of the problem, although it lias the effect of constantly reducing the supply of trustee stocks and creating fresh anomalies which, of course, are bound to arise so long as trustee securities are rigidly defined by law. The stream of new trustee securities has fallen to a negligible trickle, and as a number of stocks are frequently becoming ineligible owing to the rise in prices tlio supply of trustee securities, in relation to the demand for them, is decreasing." There does not appear to be any serious suggestion in New Zealand that the range of authorised securities should be extended by legislation. The original list has been added to, but, generally speaking, it lias not gone beyond Government and local body loans and debenture issues, where the State has some interest. To extend the privilege to the shares of privatelyowned companies would involve problems more serious than those now faced. It would be extremely difficult to draw the line between a safe investment and a speculative one. Further, indiscriminate legalising of investments would endanger the principle of controj recognised as necessary by the law.

Previous experience suggests that the state of the investment market at pro-sent is a passing phase only and two or three years may seo a complete change. Consequently, it seems hardly necessary to frame legislation to cover a temporary state of affairs. However, something might be done in making less rigid the control of investment where authorised securities have moved to a premium. The position is being met to some extent by private arrangement and it is understood that the practice of giving powers to trustees to invest outside the trustee category is a growing one.

WOOLWORTH COMPANY

NEAR £5,000,000 PROFIT

DIVIDEND OF 80 PER CENT

LONDON, Jan. 8

The annual accounts of F. W. Woolworth and Company, Limited, show a profit of £4,799,950. The dividend is 80 per cenj: and the carryforward a huge balance of £5,614,454. The Stock Exchange expected the dividend to be 90 per cent, consequently the 5s shares relapsed from Ills 9d to 112s.

The dividend is the same as that distributed last year, when the rate was raised from 70 per cent. Last year the profit was £4,525,384, and the amount carried forward £4,429,076.

FIRM WOOL MARKET

COMPETITION IN SYDNEY

KEEN AND WELL DISTRIBUTED (Received January 9, 9.45 p.m ( ) SYDNEY, Jan. 9 At the Sydney wool sales to-day 11,658 bales wore offered and 11,143 were sold. Also 1641 bales wero sold privately. Under very kedn and well-distributed competition the market continued to reproduce all the best features of former sales, with the trend still in sellers' favour. Japan, Yorkshire?, France and Germany were the chief operators. Greasy Merino sold to 16(1. NEXT LONDON SALES NEW ZEALAND OFFERINGS LONDON. Jan. 8 The wool available for the London sales 011 January 15 totals 11)6,600 bales, including new arrivals, a* follows: Australian, 66,000; New Zealand, 16,500. .It is expected that 162,000 bales will be catalogued. AUSTRALIAN GROWER CAPITAL IND E BTEDNESS The position of the Australian woolgrower very closely approximates that of the wheatfarmer as far as capital debt is concerned, in the opinion of Mr. 0. L. A. Abbott, Federal member of Parliament for Gwydir, New South Wales. In an interview last week, Mr. Abbott said tho indebtedness of the wheatgrower was estimated at £138,000,000, and that of tho woolgrowers would be at least a similar amount. Tho wool season was suliiciently advanced to show that the return to growers would probably bo between 8d and 9d per lb., yet an ounce of knitting cost one shilling. Thus the woolgrower received only ,£B4 a ton for his wool, while Australian linns charged £1792 a ton for wool that was the next stop from the raw material —an enormous discrepancy. Tho spurt in price levels in 193.1 was not a complete blessing. Although it enabled growers to reduce portion of their indebtedness, it gave the general impression that all was well with tho wool industry.

BUTTER MARKET FIRM

NEW ZEALAND AT 80s PER CWT

Now Zealand butter remains firm on the London market, with finest selling at 80s per out., to which it roso at the beginning of the week. Merchants have received tho following cablegrams, dated January 8, from their London principals: — The New Zealand Producers' Cooperative Marketing Association, Limited.—Butter; New Zealand, finest 80s, first 70s; Danish, ]2os. Cheese: white and coloured, 475. Both markets are firm.

Joseph Nathan and Company, Limited. from Trengrouse and Nathan, Limited.—Butter: Tho market is firm at 80s. Cheese: White and coloured, •17s to 47s (3d,