LOCAL LOANS.

Poverty Bay Herald, Volume XLIX, Issue 16042, 1 February 1923, Page 7

LOCAL LOANS.

/To the Editor ol the Herald ) Sir,—A paragraph in last evening’s paper re the price of money in England should be emphasised. It says: “Money in England is absolutely cheap . . . big business firms are obtaining money at 2 per cent.” This harmonises with the London cables announcing the Bank of England rate at per cent. In addition, we have the fact in our favor that persons remitting money from New Zealand to London are being paid a premium for so doing, instead of having to pay exchange charges. Has it ever been known before, in the history of Now Zealand, when financial relations with London were so favorable to our end? Every indication seems to show that to-day is tho opportunity for getting public loans placed with the British public at a low rate of interest. Yet wo hear proposals from our local bodies to rush madly into raising loans at high rates of interest, which high rates will burden this distrii t over long periods ranging from 20 to 40 years. Would the representatives cn our local bodies agree to these high rates over long periods if they were borrowing the money for themselves privately? The answer is obvious. Let them exercise the necessary care then regarding the pledging of tho ratepayers for whom they as local representatives are trustees. Seeing that the money as proposed to be raised by the Borough Council and Harbor Board is not required immediately, there is no need for rush tactics, but time should be taken to ascertain the true prospects ori the British money market before pledging the district to an unnecessarily high rate of interest.— I am, etc.

DAVID WHYTE.