FALL IN VALUE

Southland Times, Issue 21264, 10 December 1930, Page 8

FALL IN VALUE

STOCKS AND SHARES FINANCIAL POSITION OF COUNTRY ADDRESS BY MR E. R. SMITH (Special to the Tinies.) ' Dunedin, December 9. “The world depression has naturally been reflected on the exchange during the year,” said Mr E. R, Smith, the chairman of the ■ Dunedin - Stock Exchange at the annual meeting to-day, “and it would be idle to pretend that business has been up to thd normal standard. The fall in the value of all shares has been very pronounced and need-not be dwelt upon. The prospects for the coming year do not yet, in my opinion, disclose the silver lining that we are all looking forward to expectantly. Owing to the large sums of money that the Dominion has invested in Australia during the last few years, we arc very closely linked with the Commonwealth markets and therefore deeply- interested -in . the problems that at present confront its people. Interchange of business is, however, as you are all aware, almost prohibited by the heavy ruling rates of bank exchange so that the flow of money to Australia has; been checked. That in itself is not undesirable as it should result in .our local investments and industries receiving more support ..than in the .past. One does not like to comment on the lesson to be learned from our neighbours and the position they have reached, as the result of extravagant borrowing and unproductive expenditure, except to state that the leaders of our Government do not seem to be capable of profiting by the example and their slogan would appear to be ‘eat, drink and be merry for to-morrow we die.' This is exemplified by the fact that during the last six months they have quietly borrowed over £9,000,000, a large proportion of which is being spent on non-productive works, this notwithstanding the gloom overshadowing all primary industries. Our already huge interest bill is being greatly increased. No sufficient attempt has yet been made to reduce the cost of our Civil Service, which is notoriously top heavy. Why, it may be asked, should this section of our community continue to draw their usual salaries while the people who provide them, the producer on the land with wool at 3d per lb and butter-fat at 9d per lb, the manufacturer, the artisan and the business community are practically all experiencing severe reverses? Those who pay the taxes cannot longer sustain these | outgoings nor can they continue to provide I the active rate of pay which is being maintained on the works put in hand for the unemployed as long as 14/- per day is available. The unemployed single man will not exercise much initiative in seeking for other avenues of work. Indeed, as is wellknown, he will frequently relinguish a good position in order to get on to a Public Works pay roll. ‘Io return to the world depression, our imports for the nine months ended on September )0 totalled £33,348,000,” concluded Mr Smith, “and, with the exports at £38,131,000, show a favourable balance of £3,(82,000. The lessened value of our primary productions during the coming season will adversely affect our export figures, but no doubt the import figures will also fall. The favourable balance disclosed about all it. is hoped to be maintained and do its share in carrying us successfully through our difficulties and eventually, if combined. with the necessary economies, will restore New Zealand to its old position of a very prosperous country.”