BUSINESS AND BOODLE

NZ Truth, Issue 570, 20 May 1916, Page 4

BUSINESS AND BOODLE

BY "CAMBIST."

Australian Mutual Provident Society Sixty-Seventh Annual Report. It is now a couple of years since "Cambist" made any reference to this great insurance concern, and the feature that then struck him as the most outstanding, appeals Just as much on ithis occasion. It is an incongruous fact that the A.M.P. ever entered m the field of industrial assurance.! It must ever be borne "m mind thar the Australian. Mutual Is a concern "bossed" by men who are the head- and front .of capitalism m Australasia. It must not be forgotten that the direction is planned on lines which make It Impossible for a small man eVer to have a seHt on the Board. Before one is eligible for such a seat he must carry a large amount of assurance on his own life, besides running the chance of , A BE". BLOCK VOTE which is always at the disposal' of the sitting directors. Then, again, it is necessary to keep m. mind that the needs: of the fat man are m the nature of things quite different to those of the small, humble wage-owner. It is, therefore, a straining of the word "mutual" when we find- so grea-t a divergence la the classes who make up the clientele of a big society such as this. Mutual implies far more than "all profits belong to the members." It implies a community of Interest -which is quite absent from the affairs of this huge concern. Let ua give an example of this right away. Taking the actuary's report where he deals with the cost of management, it is found that the ordinary department absorbed 13.31 per cent of the premium receipts, and that the corresponding charges on the industrial department were 32.94 per cent ,It is fair to ask where the mutuality comes In when one class (the wealthy policy holders) are only debited up with 13.31 per cent, while the other, viz.. the working classes, pay': 32.94 per cent It must be admitted that as life insurance charged go, these rates* are well within ; the average, but then it only brings to light the fact that industrial insurance Is altogether too expensive, it luxury for the poorer members of society. It is differences such as these that have set humane persons thinking and writing upon tho subject of life Insurance, the burden of these writings being m the direction of ad x vocatlng universal State life Insurance. In the latter case, the handling of vast sums of money would be taken from the control of wealthy, exploiters of the .;■ public. , We should not see magnates of the Sugar Trust dominating large sums 6t money, arid, at the game time, pretending they are doing so for purely philantropio motives. But, then, anything can be done if one has enough money to handle. To be quite fair, one must remark that ordinary life insurance Is cheaper to acquire than Is the industrial sort In the first case, , the policies are for much larger amounts as befits tho richer members of society. They do not have to' pay their premiums m "bobs" and "tanners" per week nor do they have to be called upon for each little premium. Because of this feature the humbler insurer, but oqu&Hy thrifty person, is debited up with the cost of calling upon him at his villa, and all .: the other ... incidentals which,, such a class of business '"deriiaftds; and,*' to put it plainly, from the 'figures the actuary presents, it costs the wealthy insurer on his premiums 13,31 per cent., while the poor man, the little thrifty premium payer, haa to parr up nearly onerthird of his premium, to be exact, 32.94 per cent. It is 1 little things like this which informs the thinking worker that. he is being exploited to some pur- i pose. He Is carrying upon his back a lot of canvassers, and office hacks which do him no good, but perhaps ho, the worker, is the moat to blame. The worker has never taken finance Berlously, or used bla power to govern the i State for the, Individual benefit. It all comes In there. The returns have only been furnished to the end of December, 1915, which is the date the company balances Us atfairs, but the effects of the war are beginning to be felt The sum of £843.---053 is due to claims arising from the war, and that amount has been paid to the beneficiaries of fallen heroes. The total amount of such payments will make a large showing as the war goes on. IT JS INEVITABLE. Looking over the business figures for the year, the fact that people are insuring at a great rate la made clear; 22,019 policies were completed for tho period m tho ordinary branch These made cover for £6,620.627, and average out nt £308 each, while 23,868 industrials account for £935,501, and these average £38 ouch. In a word, hero is Seven Dlnls and Belgravla at a glance. It lg a great pity that the cost of these insurances should be no wide apart aa thoy are, Tho rich pay about one-third of the expense that poor Bill Jim has to. But such la the way of the world, and thero la room for much Improvement here. The amount of the funds at credit of tho ordinary branch la £34.034,184, while the Industrials have £785,693. Altogether, the Society handles a vast sum, out of which only £13,036,059 l» lent on mortgage m these States. They seem to favor Government debentures and loans to local bodies. Tho latter Is very handy for tho borrowing "bumbles." and tho money does good In developing local Improvements, the former class of investment only provides a j LOW RATE OP INTEREST, and, at tho samo time, require* annual valuations, which of late have beon on tho downward eldo of things. This year £20,633 had to bo written off securities, but it Is not likely to be a loss/for the Society con well afford to hold on till better times and prlcos come again.

knowledge : were brought into the venture m x>rder lo solvo tho difficulties which hang round the iron sand problem. New Zealand people think that the iron sand is, only a product of. this country; but they are wrong 1 m that assumption. Titanic iron sands abound m many parts of the world m much STeater quantities than is the case here, tt.is well to remember this, for.it tells us something which we are apt to f orsret, viz., that the problem of smeltingthe iron sand is being- studied, and has been tried out, In many lands. Nowhere has it been brought to a passable, commercial point. If ever a metallurgist or Inventor should patent * a process for dealing m a payable manner with titantic lronsand, it is not m New Zealand that gentleman will be found. *He will make" tracks for the United States and be v' i ; v LAUNCHED INTO POTENTIAL MILLIONS. The man who solves the problem* need not waste time over the tin-pot capitalists of this tiny earthquake spot, the place would be too small for him. Norway, Russia, America, North and South/, and other places have feiidrmous deposits of Iron sand. There are many metallurgists of, world-wide fame m these countries vrho have given atten-, tlon. to this particular smelting--pro-blem but they have made no practical progress with it L For millions of acres of sands He In useless profusion upon the earth's surface at the present time. So far as the commercial val\ie of titanic sands can be expressed, the one word "nil" will do. Leaving all the historical matter behind for the present, "Cambist" now comes to the prospectus of the company whose name is at the head l of this article. It is one of th© most noncommital documents it has ever been writer's lot to handle: . It, does not inform prospective Investors -what they are likely to receive from profits when the company .gets into full fling of business. It does not hint at the estimated profits per ton of iron produced, bor give the slightest inkling as to tho 'amount of profit; the outturn of titanic steel will provide, not even with the help of the Government bonus, which is evidently onjs of the things which is dangled before the eyes of the plucky per-' sons who may tackle this wondrous venture. It would certainly be a matter of easy computation for the vendors of the "Moturoa Iron and Steel Syndicate" lo give come figures to sup--port their statements that "from actual practice it has been found that pig iron can be produced at a coat of not exceeding, £3 per ton," Now, thjs writer would, be glad to know if that Is tho cost of smelting from titanic Iron sand, or if it is the cost of emelt lite' the iron ore? The point is important for the reason that any person COUlfr produce Iron from tha latter source, and tho cost is, therefore pretty well known to ironmasters. In the case of the iron sands it is a very different raattor— no person knows whether It can be done as yet at a profitable rate. "Cambist" "floes not suggest anything mis-; leading, but he does say that the prospectus . .. ■■ -■• >. ." , "'•s [■■ >; LEAVES HIM IN THBDAIRK as to what is really meant* The company's name mentions "iron ore" smelting, while the prospectus appears to be dealing with "manufacturing iron and steel from magnetic and tltaniferous Iron sands." It may be correct to call sands ores, but can the. name term be applied to different "things f " However, to ? get into the • prospectus from the business end, It appears to be the overpowering wish of tho "Moturoa ! Iron and Steel Syndicate" to sell out their patent rights and plant to the New I Zealand Iron Ore Smelting and Manufacturing Co., Ltd.. for £1000 m good, hard cosh, plus 25,000 paid-up shares of £1 eaoh. Tho company which the ln r vesting public are asked to put their money into is now being pushed along with a capital of £60,000 m £1 shares. Out of that sum £1000 is to be paid to , the vendors, who are to receive, m addition, the paid-up shares of nominal value £ 26,000. "The peculiar- feature about the whole business Is this, the vendors are also <IJirectorß ; in4ho new company, viz., Messrs. S. 13. 'Fraser, <3©o, t'raaer, J, A, and W. P. Heokett. and Duncan Rutherford. The other director, Mr. J. B. Laurenson, has, so \ far as the prospectus states, no Interest with the vendors. In other words, live out of six directors are directly interested IN SELLING OUT THEIR INTERESTS m the Moturoa syndicate to the new company. They are thus standing m the remarkable position of being both buyers nnd sellers of the plant and patent rights. Whon the thing is investigated further, it is found that theso gentlemen will receive the purchase money and shares somewhat after tho following manner; Mr. Ruthorford gets nvo-tentha, Messrs. Frosor got twotemhs. wnlle thQ Hoskotta aro down for i three-tenths. From this It will bo seen that Mr. Rutherford holds tho pride of place, as he practically owns -one-half of the "whole box of tricks." Now £12,600 m pald-qp shares and £500 m good, Twird cash, la a very tidy swag these dull times, and at the moment It sotsrone wondering whether the seller or the buyerMs getting a bargain. The proposition is on the £i per share basis, and for that reason it may be that the small investor is being speolall&cale,r ?M *?*' , Jt " aoh b 0 th « <*»«« •'Cambist" strongly advises that careful person to moke tho\fbließt investlga. tions regarding the possibility of obtaining Interest upon the money ho may Invest. It Booms altogether too rosy to bo able to pick up a syndicate that can manufacture pig iron at £3 per ton which Is willing to part with so much vnlilo for a paltry £ 25.00* m pald-ups and £ 1000 m cash. On the face of things they are "soiling their birthright for a mess of pottage." Nevortbeless, it must not be forgotten that when TKE VENDORB GET THEIR WHACK there will bo only £34,000 left for tho company to enter the wmoltJng business w ... Did * n y°n«-«ver hear of an Iron nmoHlng company starting with no small a capital? Especially when ono nnds that they have taken powers to enter Into the oil fyislneas In Tamnakl, "or In any oilier part of tho world." From the look Of things, It would appear as If the vendors wore tull up of the Molurott. Syndicate, und, at the same time, they were not averse to a big price for tho whole contraption. That Is one side of tho picture. What this writer awaits !« to hear the response that the public will give to tho i offer of shares m the New Zealand Iron Ore Smelting and Manufacturing Co., Ltd. If it be possible to exploit the Iron sand problem on a paid-up capital of ZSi.QQQ. "Cambist" would bo dclUrht. o<l to «■<* (t succeed. Thin ebtwtry \ needs v lot. of iron, and it would be a Krand thing to be able to mmm the supply from the stormy bfttichen of ibo Do* minion, To every Hoverolgn Invested m the concern, "Cambist" piously says, "Quo Vadla."