TALK OF PARTIAL DEFAULT

Timaru Herald, Volume CXXXVI, Issue 19105, 10 February 1932, Page 7

TALK OF PARTIAL DEFAULT

REVEALED IN SECRET CIRCULAR

DIFFICULTIES AHEAD OF AUSTRALIA. United Press Association—By Elocrn. Telegraph—Copyright LONDON, February 8. A secret circular of a London firm of brokers issued to clients, says that a partial, temporary Australian default seems inevitable. It is possible that holders may be asked to agree to a reduction of interest, and therefore it would be sound policy to sell all Australian stocks and reinvest in British, Indian, Soudan and Argentine stocks. The Australian Press Association understands that the circulars have come into the possession of Australia House, from where strong representations will be made to the brokers against this unwarranted injury to Australia’s credit. EVIL CONSEQUENCE OF DEFAULT. MR LANG DENOUNCED. United Press Association—By Electric Telegraph—Copyright MELBOURNE, February 9. Dealing with the New South Wales default, Mr Bruce, speaking at Dandenong, described Mr Lang as the “greatest menace that Australia has ever had.” i “The position,” said Mr Bruce, “is too serious for words. Australia is making towards recovery, and probably would have been the first country to recover had Mr Lang’s default not caused our good name to go down. It is impossible to calculate how far it has thrown us back, or when we will recover. It hurts terribly to see a country held in such high repute as was Australia now held aloof in contempt, because of a small coterie who have no love for the country in which they live.” WILL THE FEDERAL CABINET PAY? > AWAITING NEWS IN LONDON. UnlUd Press Association—By Blactrlo Telegraph—copyrlgm LONDON, February 8. Pending the disclosure of the Commonwealth's intentions regarding the New South Wales interest, Mr A. C. Willis deferred further action in connection with a moratorium. FEDERAL GOVERNMENT TO PAY INTEREST. DAMAGE TO AUSTRALIAN CREDIT United Press Association—.By Electric ‘Telegraph—Copyright (Received February 9, 11.55 p.m.) CANBERRA, February 9. After the Federal Cabinet meeting to-day, the Prime Minister announced that the Commonwealth Government had decided to pay interest to the bondholders to whom the New South Wales Government had defaulted. Mr Lyons said that legally the Commonwealth \ms bound to pay it and arrangements were in the making to that end forthwith. The Government deeply regretted the damage to Australian credit that had resulted from Mr Lang’s default.