TRADE AND FINANCE

New Zealand Times, Volume LXVII, Issue 3439, 21 May 1898, Page 2

TRADE AND FINANCE

The warlike speeches of Lord Salisbury and Mr Chamberlain have caused a profound sensation in European political circles and depressed the Stock Exchange, So sensitive a barometer as the Stock Exchange could not fail to register a change in the political atmosphere, and the effect is to be seen in the prices of gilt-edged securities A depression of any duration on the Stock Exchange has disastrous and far-reaching effects. The dealings on ’Change ate simply huge gambling transactions, and the gamblers are propped up by banks and other financial institutions. An immense amount of stock is held in pawn and the unfortunate borrowers are in a time of panic obliged to provide additional cover as the price of the pawned security drops. At the present time the bankers have received a very plain hint (for it will be remembered that Lord Salisbury’s ominous speech was made at a semi-public dinner tendered to him by London bankers), and that they will act upon it goes without saying. Bankers will call in their loans and weak holders of securities will be obliged to sell at any sacrifice. Flooding the market with securities demoralises it and causes a panic. War may offer very pleasant prospects to the fighting man, but to the captains of finance it is disastrous.

The new issue of capital in the United Kingdom during the first quarter of the current year amounted to £48.054,000, as against £28.116,000 and £30,925 000 in the corresponding period of the two previous years. The total is the highest recorded for the first three months of any year since 1889, and has only been twice exceeded in any quarter since 1892. Breweries and distilleries, £4, 127,400; mercantile businesses, .£3,792,500; Indian and Colonial Government loans. £3,301,300 : British municipal loans, .£2,153,700; stores, &0., .£2,448,000; and mines, -£2,639,900, which last included only £500,000 Australasian. One of the most notable flotations during the quarter was the business of Sir Thomas Lipton, the capital for which was subscribed practically 40 times over. The rush for the shares on the part of the public was apparently au unrivalled scene, The National Bank of Scotland had to borrow the premises of the bank next door to accommodate the crowds of subscribers, who came personally, and 75 extra clerks found work enough to break their backs. At Lipton’a own City road headquarters 500 extra men were put on to register transfers, and the Bame eoenea were to be witnessed at the other issuing offices. Lipton spent £17.500 in advertising his prospectus, which perhaps accounts for the success of tho isoue.

The third of the series of London wool sales, which opened on the 3rd inat., was to close last night. The market, aa was anticipated. has recorded a fall in values principally in crossbred wools and inferior qualities Merino wool, though exhibiting a decline, has boon less depressed than other descriptions. To the Spanish-American war is attributed the fall in values* the American demand having been curtailed* The war, while it has. contributed to the slackness in the wool market, has not been tne sole cause of the dullness. Writing soon after the close of the second series of sales Messrs Dalgety and Co* had the following in their Wool Circular :~ The weak spot at the moment is, that in the United States the wool trade seems in a somewhat bad way, and noi for the first time speculation in that country seems to have been driven beyond its legitimate limits, resulting in importation stocks beyond the power of consumption in the immediate future. Indeed, it is very • probable that any further slight increase in values here might bring back to this market some thousands of bales now lying in bond at Boston and New York, and it is possible ibis may occur, to some extent, even oh present basis of London values,** Bpfc to set off this there is the pregnant, fact that the statistical position of wool is extremely strong. In addition to the fact that there was a shortage in the Australian clip, supplies have been further diminished by the loss of the wool cargoes of the wrecked steamers Mhtaura and China, and the destruction by fire of a large stock of speculative wool held in Boston, U.S.A. Australasian wool exports up to a recent date show a decrease ot 103,374 bales as compared with the corresponding period of 1897, as will he seen from the following table

Colony. Date. 1897-8. 1898-7, * Bales. Bales. New Zealand ... April 30 373,719 316,523 Victoria ... April 30 381,612 434,398 N.S. Wales ... April 31) 607,030 659,472 8, Australia ... April 30 113,790 150,146 Queensland ... May 2 104,891 122,231 Tasmania ... Eeb. 28 3,900 5,606

1,585,052 1,688,426 There is a decrease in all the colonics except New Zealand, which, for the period under review, shows an increased export of 67,226 hales. . , The Assistant Government Statistician a figures giving the value of the excess of exports over imports of wool enables a comparison to bo made between the am junta realised in the two years 1896 and 1897 for this staple product. The comparison is as under:—

1890. 1897. Colony. £ £ New South Wales ... 8,810,375 8,021,704 New Zealand ... ... 4,391.575 4 412,814 Victoria ... ... 2,638,908 2,035 062 Queensland ... ... 2,976,981 2,492,839 South Australia ... 1,200.994 957,937 West Australia ... 267,508 295,616 Tasmania ... ... 290 825 264,420

20,627,167 18,512,872 The wool clip last year, notwithstanding that comparatively better prices were obtained, realised .£2,114,295 less than in 1896.

Holders of wheat in New Zealand appear to be taking a veiy optimistic, view of the market prospects judging by the rapidity with which prices are being advanced. This optimism as to values has already led to the importation of two or three cargoes of wheat from Australia. A summary of the position of the wheat supplies in the Australasian colonies is contained in a circular issued by the Adelaide Milling Company (Limited), and is thus set forth: — If reliance is to be placed on the official figures issued by the statistical departments of New South Wales, Victoria, South Australia, New Zealand and Queensland, these aggregate 32,571,156 bushels, to which has to be added the estimated yield of Tasmania and Western Australia, 2,000.000 bushels, and the estimated stocks brought over from the previous year, 2,500,000 bushels, making a total of 37,071,166 bushels, from which has to be deducted 27,128,000 bushels for food and seed, calculating consumption at five bushels per head for 4.347,000 persons, leaving a surplus of 9.913,156 bushels available for export, which is equal to 266,331 tons. The correctness of the yield of Victoria and New Zealand has been questioned, but if these two colonies produced only sufficient for their own consumption, a deduction of 91,608 tons will have to bo made, which will reduce the surplus to 374,726 tons, without taking into consideration the quantity imported and on the water from America to New South Wales. It, therefore, from these figures that the value of wheat in Australia must be governed by the price European buyers are willing to pay. The carry over is probably over-estimated in the above figures, but in any case even allowing a fair discount for this there is still a fair exportable surplus, which must be sold at the price European are willing to pay. But since the above opinion was given European markets have been extremely agitated, and the competition which has arisen through some of the Continental Governments buying in the open market has forced up prices. The wheat corner in America has also helped to advance prices. Wheat will bo firm, and probably top values have already been reached. Another month or six weeks should see the tension relaxed, as by that time the estimates of the approaching European and North American harvests will have been made, and the market would see relief in prospect.

The index numbers published by Sauerbeck, indicating the movement in prices of 45 leading commodities daring the past four years, are as under : 1894. 1895. 1896. 189 T. 1898. January ... 65‘8 69*0 61*4 63*0 63*8 February ... 65*0 69*0 61*4 61*9 63*4 March, . ... 64*3 60*8 60*7 61*9 April 63*8 61*7 60*3 61*5 May 63*1 62*5 60*1 61*2 June 63*1 62*4 59*3 61 3 July 62'6 62 8 59 2 61*7 August ... 63*0 €3 3 59*7 63*2 September ... 62 7 63*5 61*8 63*4 October ... 61*7 63 3 62 6 62 7 November ... 60 8 62 5 62*6 62 4 December ... 601 612 62*0 62*4 Average ... 63*0 61*9 60 9 62*1 the year 1896 was the worst period, recording the lowest average, and the three months June, July and August of that year were by far the worst month*. In the first two months of the current year there is shown a vast improvement, and the average for the two months is a shade better than the best of the yearly averages. Maohonoohie’s Worcester Sauce is the best of sauce. Piquant and appetising, it ia an excellent “pick-me-up.” Few sauces elinal it, and none surpass it, $69