HARD TIMES COMING

Sun (Auckland), Volume IV, Issue 970, 13 May 1930, Page 10

HARD TIMES COMING

ECONOMICS PROFESSOR VIEWS FUTURE ULTIMATE PROSPERITY A season of greater hardship followed by a gradual climb to prosperity was foretold by Professor H. Bclshaw. Professor of Economics at Auckland University College, in an address on “The Present Trade Position/’ at a luncheon of the Karangahape Road Business Promotion Society this afternoon. He pointed out that New eZaland’s prosperity deepnds entirely on the state of overseas markets because of the prominent position of export business. An unfavourable trade balance affected • the banking rate as well as trade generally, said the speaker. A good market for exports had an immediate effect on the ready money of the farmer, but had only a delayed effect on importers and banking institutions. In the meantime, the balance of trade was favourable, but this nearly always was evened by a resultant unfavourable movement. New Zealand should have an excess of exports by about £ 4,000,000 annually in order to meet interest and sinking fund on loans made in the past. An expansion of business might reasonably have been expected at the end of 1928, but this had not eventuated owing to lack of confidence by businessmen in future prospects, a high bank rate, and the immediate liquidating of debts piled up during the previous depression. Funds were available, but were not invested. Today, the position for trade . was more unfavourable than a year ago. Tho value of exports, dairy produce and wool particularly, had dropped appreciably and “Imports had increased. The financial position of Australia, and large borrowings of past Governments in London, had contributed to the present business depression. "The immediate prospect is far from rosy, but is not entirely black,” said Professor Belshaw. “A fair amount of wool and dairy produce has been held in reserve awaiting a rise in prices, and this has led to a worse position being shown by statistics than is actually ruling*. It seems quite reasonable to expect an improvement in export prices after the difficult period now in sight is over,” he concluded.