MR J. A. CONNELL'S OPINIONS. PROSPERITY THE RESULT OF LAND SPECULATION. A COLLAPSE IMPENDING. Auckland, August 22. THE BOOM IN MELBOURNE.

Te Aroha News, Volume VI, Issue 295, 1 September 1888, Page 4

MR J. A. CO NNELLS OPINIONS. PROSPERITY THE RESULT OF LAND SPECULATION. A COLLAPSE IMPENDING. Auckland, August 22.

THE BOOM IN MELBOURNE.

Heartxg that. Mr J. A. Connell had just re_ turned from a trip through Sydney and Melbourne, one of our staff waited upon that gentleman yesterday afternoon in orde 1 ' to get an outline of his opinions with regard to the present prosperity of Melbourne. Mr Connell was found in his office, as usual, hard at woik. He received our re preset! tative very coidially, and upon being informed of the object, of the vi«ir, said : You want information about Australia, I suppose, particularly with regard to its alleged great prosperity ? Reporter : Yes, we should like to have your impressions upon things in general in New South Wales and Victoria. Mr Connell quietly lit his cigarette and said : Well, I went away from here towards the end of last June, and have been away about two months. I was in Sydney for a fortnight, and the lest of the time I spent in Melbourne. With regard to Victoria, it, is unquestionably at the present time the most prosperous of the two colonies, and the appatcnt prosperity is considerable. I say apparent, because I think that it is only temporary in its chaiacter, and I believe it to be owing to causes which are of an altogetherarfcificial, temporary, and it might even be termed improper chaiacter. At thepresent moment the city of Melbourne is in a state of incense artificial financial excitement. Companies are being formed for a very large number of purposes, and a number of thesecompanies ate being formed for no otner purpose than that of speculating in land. Going back to the origin of the present state oi things, we find that about 18 months or two years a^o land in Melbourne andit>suburbswas, comparati\ely speaking, unsaleable, and consequently low in price, in fact it was a drug. About this time one or two companies were formed — notably the Real Estate Bank — with a -view to putchasjngland and selling thesame at a profit, or, as it is called, for '• investment in real estate." I suppose the low price of land tempted people to invest their capital. The Real Estate Bank was particularly successful in its opt rations, puichasing large quantities of land and selling at considerable proh't. The result of this was that other companies of like kind were formed shortly afterwards, tempted no doubt by the success of the Ueal Estate Bauk. in this way a very large amount of ready money came into the market, to be used in the purchase of. land. In this manner properties of all kinds were bought and sold, and very large profits were realised in many instances. If I remember rightly, the Keal,Estate Bank declared a dividend of 50 per cent, this last year, and besides this cairied a lar^e amount to Reseive Fund. This out of profits in land speculation. This resulted in the foimatioii of still further companies, and yet larger sums of money were thrown upon the market, and land still kept rising 1 steadily. This in its turn tempted others who had more speculation than capital to foim syndicates, and as they generally only paid deposits, they were willing to pay higher prices for the land. The result of ah this has been that land has risen to prices, in Melbourne and its suburbs, which in my opinion are simply outrageous, and cannot possibly last. The reports which from time to timeare circulated in the community about the laige sums made by this land speculation, ha\e caused business men frum other colonies — who are tempted by the glowing accounts — to go to Melbourne, all eager to buy and sell land. The accounts of the profits made by this speculation in land have be-n supposed to indicate natural and wondeiful prosperity all round, and this has had ther-ffect of causing an influx of population to Victoria. That invariably causes a large amount of work : for instance, houses must be built to accommodate the new arrivals. The result of all this has been, that, tracing every thiig buck to pure land speculation, theie has been a laige amount ot ap(.arent prospetity in Victoria; but I have no hesitation in expressing my opinion that a tumble day of reckoning aw aits Victoria, and that at no very distant date.

PROSPERITY UPHELD BY THE EXHIBITION. There can be no doubt also that the near advent of the Exhibition has had a considerable effect in helping to promote prosperity. For one thing it has caused a large amount of work in the erection of suitable buildings, and the receiving and arranging of the vast number of exhibits which ha\e been forwarded fiom various parts of the worli. All this has given employment to large numbers of people. All this is, however, entirely excep ionai employment, and will soon pass away. Of course,, the large number of bona fide, visitors who have been, and aie still going, to the Exhibition is, of itself, a gain to Melbourne, but that aleo only lasts during the time which the Exhibition is open. Leaving Melbourne, and beginning to look at the colony of Victoria it&ell and its industries, I have no hesitation in &ayingthat things are not be ter there than they are in New Zealand. The farmeis and settlers there throughout the colQny are not only not better ofi than the settlers ot New Zealand, but in my opinion are much worse ofF, and their futuie is not nearly so hopeful. I come back again to this colony moie in love with it than ever I was. lam more determined than ever I was to sbund by it, and am more impressed with the resources of our colony, and also with its chances of permanent prosperity, than ever I was before. A 'SILVER LINING TO THE DARK CLOUD OF DEPRESSION. I may also say that I am satisfied that the depre&sion under which we have all groaned for 50 long is practically at an end in New Zealand. I believe that in public and private life we have all been taught valuable lessons which will do us good, and we are now ready to take advantage of better times and to u&e them moie widely than we have done in the past The price of stock is better than it has been for years throughout che colony. Wool is now at a very iair price,and will most probably advance rather than recede. Even wheat does not appear likely to fall lower than it has been, and looks even a little moie saleable than it did. The prospects ot our dairy farming appear to me to be splendid, so soon as our people — who are intelligent enougli — learn a few practical lessons in the production of dairy produce. And they must do so, for some of them need it. Once they do that, no .country in the world cuiild compete with this colony in the London market, and that market/ is unlimited for good butter and cheese. During the present depression our. farmers, like others, have learned some valuable lessons. Our mining industry has great potentiality within it, and we only want a little scientific knowledge, properly applied, to make New Zealand one of the most important gold-

producing countries in the world. Our coal mines are almost equal to anything in the world, and our climate is unquestionably the best in the world. For my own part I would sooner struggle upon a crust in New Zealand than have a tolerably easy time financially in Australia. Holding such a view of things, I have naturally returned to this colony better pleased with it than ever, feeling suro that there is a bright future for us in the near future. I think that now we have looked long enough at the dark clouds of depression which lowered upon our horizon, and that we would all do well to consider our magnificent resources and lo >k towards the excellent future which unquestionably lies before us. 1 have no doubt that within measurable time we shall find the present positions of Victoria and New Zealand absolutely reversed.