MONEY MARKET

Southland Times, Issue 22767, 18 December 1935, Page 6

MONEY MARKET

EXCHANGE QUESTION STOCK EXCHANGE CHAIRMAN’S REVIEW CARE NECESSARY (Per United Press Association.) Dunedin, December 17. The annual meeting of the Dunedin Stock Exchange was held to-day, the chairman (Mr Harman Reeves) presiding over a large attendance of members. The chairman said the exchange question was one that would require very careful consideration. It was an easy matter to raise the rate, but it was quite a different matter to effect a reduction. So far as world conditions were concerned, stabilization of currencies seemed no nearer than it was 12 months ago. While some important nations had stayed on the gold standard, some were hovering on the brink of inflation, so that it was too much to expect that all important countries could agree upon stabilization at the same time, and it must be a very long time before this could be brought about. During the year money had remained plentiful and cheap in the local market, with the result that sound investment shares, such as banks, insurance, finance and many industrial shares were in good demand and reach high levels. The most important company flotation during the year was that of the issue by the Mortgage Corporation of New Zealand of £500,000 cumulative 4J- per cent, shares at par to the public. The issue was largely over-subscribed and shares went to a substantial premium, but had since fallen in value. The issue by the Corporation of £500,000 bonds bearing interest at 3$ per cent, was not, however, received with such favour, although the chairman of the Corporation stated that the issue had also been largely over-subscribed. Cheap money in the Dominion had helped to stimulate industry and primary production, and it was to be hoped that the new Government would use its influence in keeping interest rates down as had been done by the Baldwin Government in England and the late Government of this country. The outlook for the coming year was good, said Mr Reevves in conclusion. Fairly high prices for all the country’s products were being obtained so that there should be a large sum of money seeking investment during the course of the year. Much of this would as usual find its way to members of the Stock Exchange for investment, so that it behoved them to see that their clients made purchases of only the best and soundest of securities. It was to be regretted that owing to the lack of sound securities in this country large sums had been invested during the year in shares of Australian companies, the purchase of which had, in most cases, been profitable, and he thought he could safely say that there were so many opportunities for safe investment in Australia that investors would continue to make purchases of shares of selected companies in that country. Owing to the high rates of exchange, the amount invested in British securities in recent years had been practically nil. The following office-bearers were elected for the ensuing year: Chairman, -Mr Harman Reeves; executive committee, Messrs E. R. Smith, H. K. Poppelwell, J. H. Walker, W. H. Mcleod and C. Penman; trustees, Messrs Reeves, Smith, and W. J. Watson; auditor, Mr J. W. Smeaton.