PRICE OF GOLD

New Zealand Herald, Volume LXXIV, Issue 22818, 27 August 1937, Page 7

PRICE OF GOLD

REDUCTION UNLIKELY SIR W. HUNT'S OPINION FLOW OF "REFUGEE MONEY" The opinion that there was no likelihood of a reduction in the price of gold was expressed by Sir William Hunt in an address to members of the Invercargill Chamber of Commerce aud others. Sir William based his remarks on expert financial opinion in London, and pointed out that the "refugee money" which had flowed steadily into England and the United States would some day be recalled, and it was not likely that these countries would be willing to return more gold than they had received; as they would have to do if tho. price was reduced. If America reduced the price of gold it was thought that England would have to follow suit. England had tried to keep the price on a par with America, about £7 an ounce. It was a fixed price in America, but it was not fixed in England.

The Economic Sequel The flow of gold was just the natural consequence of economic happenings, Sir William explained. It represented a great deal of loose capital, or refugee money, belonging to people who did not want.-to invest it but wanted it turned into some currency that would not depreciate. They had most confidence in British or American currency, hence the flow of gold to those countries. Gold was the only substance the whole world would accept and there were no tariffs against it. There statistics of the amount of refugee money, but it was estimated -at between 7,000,000,000 and 8,000,000,000 dollars in the United States and between £700,000,000 and £800,000,000 sterling in England. The flight of. the franc was estimated to have sent £.550,000,000 to £600,000,000. sterling to those two countries. .

Private Hoards Appear During the scare private hoards of money were coming into the market at the rate of millions every day. England and the United States could not afford to reduce .the price of gold, because some day that refugee money would be called home again and when it went back the gold would be redistributed. If those two countries reduced the price of gold, they would have to send away so much more gold when the return flow started.

"From the opinions I heard in England there is not the least chance, of the price of gold being reduced," Sir William said. He added that the scaro died down over-night with tho announcement of ,the .increase in *the Exchange Equalisation Fund from £500,000.000 to £700,000,000. Britain's rearmament scheme was keeping international peace and this immense equalisation fund was. keeping financial peace. Britain was the most powerful influence in the world to-day for peace and .economic stability. There was continual alarm about the franc, Sir William said. The,, French were an extraordinary people and very industrious. They were a wealthy nation, and they wanted a lot of social services, but did not want to be taxed for them. If the Government refused to give these services they turned it out, and when they were taxed for them they also turned the Government out. '

ASPARAGUS FOB CANNING NEW HAWKE'S BAY INDUSTRY EXPORT TRADE POSSIBILITIES [BY TELEGRAPH —OWN CORRESPONDENT] WELLINGTON, Thursday A new"'"primary industry, the growing of asparagus on an extensive' scale, for canning in New Zealand, has been started in Hawke's Bay. Those interested in the project believe that it has great possibilities. In addition : to canning for the local market,' they hope to export chilled asparagus to England, and later possibly develop an export trade in the canned article. In the past asparagus growing in New.Zealand has been confined to small areas, few greater in size than a quarter of an acre, and the. largest five acres. The whole of the crop has been sold to the - local.. consuming public in the fresh, state, and the only "canned asparagus on the market has been that imported from America. As a trial last year a Hastings cannery placed on the market 200 cases of canned asparagus; the product was so favourably received that the cannery has entered into a contract to take from a newly-formed company the whole of the product for 15 years from an area of 102 acres. The company will have 26 acres under cultivation this year, 50 acres next year, and the whole area in 1939. Tho estimated yield from one acre is two to three tons, valued at not less than 4Jd a pound. The possibilities of an export trade in canned asparagus will be considered later, when the company - hopes to extend its operations to further areas. Australian canneries have recently had inquiries from England, but have been unable even to meet the local demand. It will be two years before the plants reach the cutting stage, and in the meantime the company expects to receive substantial revenue frojrn growing potatoes and tomatoes and'" peas for canning purposes. The Department of Agriculture has shown keen interest in the whole enterprise and has given valuable assistance and advice.