DOMINION SECURITIES

Otago Daily Times, Issue 24945, 18 June 1942, Page 3

DOMINION SECURITIES

PRICE FALLS IN LONDON TREASURY REASSURANCE NEEDED (Rec. 8 p.m.) LONDON, June lb. The Scotsman, in a leading article, urges the British Treasury to take action to strengthen confidence in dominion securities "at a time when there is much talk about unification of the currencies of the United Nations or at least the currency union between the British dominions and the United Nations. It seems a poor reflection upon war-time financial planning that the financial relations between members of the British Empire should not be closer. The Government of India has set an example by announcing its intention to stand behind municipal and other semi-official securities, and the result has been an immediate advance in the prices of these stocks. Why should not this principle be applied between Britain and the dominions? Financial circles may be completely confident ;n the indivisibility of the Empire's finances, but the general body of investors and holders of stock of the dominions directly threatened as the result of Japanese aggression do not share this confidence. "For the first time since the Pacific was involved in the war New Zealand stocks a few weeks ago showed signs of ' unfreezing,' and buyers appeared for nearly all stocks at slightly above- the minimum prices, but the improvement has not lasted. Australian stocks are more firmly frozen than New Zealand, and the securities of both dominions at present can be regarded as approximately of equal merit. It seems ridiculous that the credit of great dominions, as measured by the prices of their securities in London, should be standing at an inferior level compared with the stock of a badly bombed municipality like Plymouth. Such would not be the case if the Treasury indicated that it was directly interested in the care of the dominions' finances. Meanwhile, for want of nothing more than a reassurance from the Treasury, investors fight shy of the great dominions' securities, prices for v/hich have fallen to levels which give Axis propaganda a chance of claiming that the Empire's finances are disintegrating." •