MONEY AND MARKETS

Otago Daily Times, Issue 20319, 30 January 1928, Page 7

MONEY AND MARKETS

AN ■ OPTIMISTIC SUMMARY. DISTINCT REVIVAL OF TRADE. AUSTRALIAN LOANS IN AMERICA CFrvn Association — By Telegraph—Copyrlgat ) LONDON, January 28. (Received Jan. 29, at 5.5 p.m.) During the last few days the “ Big Five ” banks have held their annual meetings, and the chairman at each meeting delivered the usual review of the financial and trade position. It is gratifying to note that all of them were bearers of tidings of comfort and joy, and rarely, if ever, has there been such a consensus of optimism. One of the cial newspapers hits it off thus: In a chorus with no discordant note, though with slightly differing emphasis or caution, they tell us that trade has revived, is reviving, and seems likely to continue to revive.” This optimism is reflected in the Economist’s monthly review of the state of trade, which shows that there is a general improvement in the unemployment position, and while the average W age rates remain stationary the cost of living declined seven points compared with December, 1925. In other words, real wages have risen. These facts show that the state of trade has improved, and such indications as r-e available suggest the prospect of a continued movement in this direction. Interest has been aroused here by the news cabled from New York that negotiations are in progress there for an Australian loan of £8,000,07.0 or £10,000,000. Discussing the subject, the London representative of an important American banking group referred to the increasing popularity of Australian loans in the United States, where an enormous amount of capital is awaiting investment. He pointed out, however, that Canada was at present able to borrow there much more cheaply than Australia. The Canadian loan there is yielding the investor 4.46 per cent., whereas Australian fives give the investor 5.13. Canada’s advantage, undoubtedly, _to some extent, was due to her geographical position, but this authority was inclined to believe that Australian credit in New York could be raised to at least a 5 per cent, basis, and in the course of time to 4| per cent. In order to do this it would be necessary to create an increased demand for bonds by advertising propaganda, and also by getting' them made trustee securities in all American States. At present Canadian bonds are trustee stocks in all States, but the Australians have not this advantage, except in two or three.

A circular issued to the wine trade by the Southard Company, Limited, which is recognised as one of the chief authorities, says that the prospects of the trade are distinctly brighter. It is unlikely that the Chancellor of the Exchequer will disturb the wine duties this yaar, unless he is convinced that the duties on British wines should be raised to the level of Empire wines. It is also possible that he may be induced to raise the dividing line of strength for low duty foreign to that for Empire wine—namely, 27 degrees. The wine trade would welcome both these adjustments. Regarding the exports of Brkish spirits, Southards say: “ Canada is new our best oversea customer, taking last year 1,447,000 gallons, compared with 1,168,000. Until last year Australia headed the list but since she though* fit to increase the duties on imported spirits her own product has gained at our expense. We suppose it is only right the', charity should commence at home, but it seems rather inconsistent that the Commonwealth should penalise oui products at the same time as we have granted Empire produce substantial preference. This treatment is scarcely just or in keeping with the policy they advocate of reciprocity.” The feature of the wool sales closing on Wednesday has been the remarkable steadiness of values and the keenness of competition, Yorkshire, German, and Swiss buyers all buying freely. It is hardly possible to recorl any actual advance in prices, but it can safely be said that wherever there has been a change it was against the buyers. As a Bradford newspaper says; “The general desire for cheaper wool remains unsatisfield, and there is little, if any, prospect of a movement towards s lower level. It is one thing to wish for cheap wool and another to secure it in f ace of foreign competition, which semis to intensify as the season progresses, and supplies in first hands dwindle.”—A. and N.Z. Cable.