THE DEPRESSION IN TRADE.

Temuka Leader, Issue 1148, 13 September 1883, Page 1

THE DEPRESSION IN TRADE.

At the annual meeting of the Dunedin Chamber of Commerce, the outgoing Chairman (Mr R Wilson) in his addresß made the following reference to dull times :—ln my former address I touched upon the depression that then existed in business circles. Trade hasnot improved since that time, ]nm sony to say that I think it worse. The Treasurer in his Financial Statement drew attention to the large increase in our imports as one of the disturbing causes. That is an evil which will cure itself. Already the published statements show a. decline, and from enquiries 1 have made 1 look for a diminution in our imports during the present financial year. We must not shut our eyes to the changes that are working amongst us. Large joint stock companies are gradually absorbing or extinguishing the middle men. Merchants, individually, are passing, away, and their places are being taken by. joint stock companies possessing large capital, borrowed in the London market at onehalf the rates of interest our bankers charge for the use of their capital. Against this no private enterprise can successfully compete. The profits are not spent in the but go to support' a class of absentees, whose only interest in the country are the dividends they are receiving from it. Whether or not mercantile companies with resident shareholders will meet these new conditions of trade, is as yet an untried experiment. Another cause of the present .dullness is, in my opinion, due to the comparatively sudden changes in the value of land. This is partly owing to the competition of the banks and loan companies, when capital was abundant, to advance on mortgage of landed securities. Speculawas thus ; encouraged, and large purchases were made in expectation of realising large profits by selling in suitable lots to small farmers. The action of the Government in throwing extensive areas open for selection, ion favorable terms for settlement has closed the door to land speculations, and instead of disposing of their purchases as they expected, tliey still remain on the buyers' hands, and the money thus advanced remains locked up, and unavailable for commercial purposes. If we look at the extent of the mortgage indebtedness of Canteibury, Otago, and Southland collectively, amounting to £14,899,251, on which upwards of £1.000,000 has annually to be paid in interest by u population of 260,000, I think you will agree with me that the general depre»sion is due not to over importation alone, but to the presence of those joint stock companies amongst us who have aided and stimulated an unwise speculation in landed estate before we had a population to develop the resources of the country. Mr Wilson also advocated the early formation of a customs league .with the Australian Colonies, so that the natural products and manufactures of each aolouy may circulate freely between each state without the obstruction of custom houses.