SANITY URGED

Taranaki Daily News, 16 January 1931, Page 7

SANITY URGED

MR. SCULLIN’S REMEDY

RESTORATION OF CONFIDENCE THE DANGER OF INFLATION FRESH CAPITAL REQUIRED ALL MUST HAVE ONE AIM By Telegraph—Press Assn.—Copyright. Ree. 1 a.m. Sydney, Jan. 15. “The remedy is neither deflation nor inflation; the remedy in my judgment is restoration and stabilisation.” Withthese magic words the Prime Minister, 'Mr, J. H, Scililin replied to a section of Labour, chiefly of New South Wales, which is clamouring for inflation of currency. He delivered an hour’s speech tonight at the Ashfield town hall in opening the Labour campaign in the Parkes by-election. Thousands were unable to \ gain admission. Mr. Scullin, who received a tremendous ovation, emphasised the very serious plight of the Commonwealth and ex- * plained that the financial and economic position had gone from bad to worse. It would not be' possible to balance the budget for the current financial year, he said. He then proceeded to examine the suggestions for meeting the position. “Some people say ive should bring down prices and wages; others say we ’ should go in for inflation —my answer to that is that the remedy is neither de- , ilation nor inflation; the remedy in my judgment is restoration und stabilisation. (Prolonged cheers). While I was abroad I discussed the depression with some of. the biggest brains in many countries and I found that the more they knew about the subject the. less they knew about the remedy, He added that there was no easy roaA; if there was, one '• be sure the older nations would \«ot be where they were to-day. “I do not want to create in the minds of the workers the impression that an easy road is by printing a mass of paper. There is a very real'danger ,in printing notes because it leads to wild inflation of currency; wuyes are depressed and rents rise. There are often expansions of credit and sometimes these are not controlled by the banks in strict accordance with economic conditions. The only people likely to benefit are the bondholders.” . Mr. Scullin said what really was needed in Australia was an infusion of new capital. One suggestion was to print notes; that would be advisable only until arrangements could be made for the flotation of a loan. Bank advances might be made where possible in order to create a stimulus for production and marketing giving employment. Mr. Scullin said he would go into.this aspect immediately with his colleagues. The whole country and the newspapers must work to some definite plan in order to create a greater feeling of security, seeking the best advice and aiming always i t a restoration of confidence. He assured thd people bis Government would do nothing to ruin/Australia because that would mean ruination of ihe working classes whom he had represented for many of the best years of his life. Nominations closed to-day for the Parkes by-election. There are four candidates Messrs. Marr (Nationalist), Joseph Martin (official Labour), Richard Blake (describing himself as an Economic Ref or mite) and Edward Tripp (Communist).

AIR. SCULLIN REJECTS SCHEME.

ASSISTANCE OF OPPOSITION.

Rec. 10.30 p.m. Melbourne, Jan. 15. It is revealed that the proposal to ask the leaders of Opposition parties to assist in efforts to re-establish Australian finance was rejected by Mr. Scullin at yesterday’s Loan Council meeting. . The Prime Minister expressed the opinion that it was impracticable. Mr. Barpes, the Queensland Treasurer, is pessimistic about the outcome of the proposed' conference of experts which jias been directed to formulate a threeyear plan for f the rehabilitation of the iiational finances. He cannot see how they can make incoming Governments accept the plans of their predecessors. Moreover, fell sorts of political exigencies are likely to militate against the of any plan. •

STOCK MARKET HEARTENED.

NEWS OF MR. SCULLIN’S STRENGTH

Rec. 10.30 p.m. ' London, Jan. 14. The latest news indicating the strength of Mr. Scullin’s position and Mr. Lang’s weakening slightly has heartened the market for Australian stocks with a cessation of the recent panic selling, says the city editor' of the Times. Bargain hunters’ action has stiffened the quotations. There has been sotne selling of New Zealand stocks, influenced by the increased discount on the New Zealand pound sterling.