REPLY TO “WIRE WHISKERS.”

Southland Times, Issue 22733, 8 November 1935, Page 4

REPLY TO “WIRE WHISKERS.”

To the Editor.

Sir,—Where has “Wire Whiskers” been camping? He talks of the Government “grabbing gold”—I expect he is referring to what Mr Hislop calls the “gold steal” from the banks. I suppose “Wire Whiskers” had, at one time, some sovereigns. Possibly he has been so far out back for so many years that he had stored up a few sovereigns which he had no time to put into a bank. Supposing he came into town say in 1934 and opened an account at the Bank of New Zealand paying in 50 sovereigns. The bank would credit him with £5O and give him a cheque book. The next day he might think he’d like his sovereigns back again, so he would present his cheque for £5O to close his account, and ask the teller to give him back his fifty sovereigns. Not on your life: The teller would smile at his suggestion and pay him £5O in New Zealand notes and the gold coins would remain in the bank’s coffers.

In August 1934 when the Reserve Bank opened, it took over the gold coins at the face value and amongst these would be “Wire Whiskers’ ” 50 sovereigns. Docs your correspondent assert, as does Mr Hislop, that the Bank of New Zealand would be justified in demanding £75 in Reserve Bank notes, for what it only paid £5O in its own notes when it took the 50 sovereigns from “Wii’ewhiskers”? The gold coins in the banks were taken over as coins at their face value, these coins paid into the banks by the customers of the banks were originally payable back to the customers on demand. The War Order-in-Council made notes legal tender and gave the banks the power to refuse to pay out in gold, but prohibited the exportation of gold coins. It would have been downright robbery of the bank customers (the people) had the Government allowed the banks to sell the gold sovereigns (paid in by customers) for 30/-, to the Reserve Bank.

No sir, there was no “gold grab — Tire Government did what every other country did when a Reserve Bank was opened. It took the gold coins over as representing the people to whom these coins belonged, and if there was any profit in the sale of such coins then that profit should go to those who owned them, namely the bank customers. —I am, etc., PETER SIMPLE.