Shares and Mining

Observer, Volume XXIX, Issue 27, 20 March 1909, Page 20

Shares and Mining

By Ob adi ah

'r> HE London money market conI tinues easy, and gold appears to be flowing into the Bank of England. Last week there was a gain of nearly half a million sterling. The foreign exchanges must now be operating in favour of London, to cause this substantial accretion of the metal. At all events, it is very probable that the Bank of France is not now taking gold quite so fast as was the case in January. The public deposits, however, are just two millions less than they were a year ago, and that points to the prospect of a heavy deficit.

What this deficit will be is hard to say, but some of the London financial papers estimate that it will amount to as much as five millions sterling. The ' ' other deposits ' ' are comparatively small, and there appeals to have been heavy borrowing" from the bank. There is sure to be some disturbance in the money market through the needs of the Chancellor of the Exchequer. The Budget estimates for the year will not be realised, and further taxation is imperative. Next week there are bound to be movements in the money market which will give some indication of the Budget prospects. It is a significant fact that British capitalists are avoiding investments in British securities, but are lending freely to foreigners.

.Locally there is no change to report, but the immediate prospects are good. Next week the Manawatu Railway money, some quarter of a million sterling, will be liberated, at least the greater portion of it, and that will undoubtedly ease the situation. The improvement in the wool market is also a favourable feature, and presently there should be more loanable capital available for Dominion borrowers.

The position disclosed by the export and import returns for the current quarter will be interesting, and there is every reason to believe that there will be a further shrinkage iv imports, with a possible gain in exports. The excellent tone displayed at the current wool sale in London, together with the firmness in prices, will be very cheering to wool growers in particular. The slump in wool is over, and we may now look for a steady improvement in values. As wool is the largest item in our exports, any increase in value must have far reaching and beneficial effects. It will help to ease the stringency of the monetary situation, as it will provide the banks with more loanable credit.

Refering to the banks, it is regrettable that there should be so much misrepresentation regarding them. The statement that the banks are calling in overdrafts is only partly true. Where their securities have depreciated, it is only natural that they should insist upon the margin being rectified, to meet the changed conditions. Furthermore, the banks have been called upon to refund deposits, and have been obliged to draw in from others. But with all this the banks have made advances very freely, especially to traders and farmers.

It is also unfair to say that there is a banking monopoly. All that the bankß possess in the way of monopoly is the right to issue notes, which right was conferred *pon them by Parliament. No doubt if another banking corporation were started Parliament would extend the right of note issue. This right is the prerogative of the State,and can only

be delegated to a private concern by statutory provision. To accuse the banks of being monopolists because of the State reservation of note issue is childish. As a matter of fact, the banks have to meet a very great deal of competition for deposits and in the foreign exchanges.

The accounts of th© Union Bank of Australia for the half year ended August 31st, 1908, show £hat the net profit was £136,386, to which is added the balance brought forward, £36,058, making a total of £172,444. The dividend and bonus, together equal to 14 per cent, per annum, absorb £105,000, the sum of £20,000 is transferred to reserve fund, which is thus increased to £11,250,000, and after appropriating £10,000 in reduction of bank premises account, the balance, £37,444, is carried forward.

The balance-sheet stows that the liabilities to the proprietors — including capital naid up £1,500,000, reserve fund £1,250,000, and profit balance £172,444 — amount to £2,892,444. Adding deposits £19,237,834, circulation £431,945, and bills • payable and other liabilities £1,700,750, the balancesheet total is £24,262,973. The assets include cash items, remittances, etc., £8,619,497 ; discounts, loans, etc., £15,058,830 ; premises, £584,646.

While transactions in investment stocks have been fewer than usual during the week, an improved feeling is shown by the hardening of quotations in some leading lines.

Bank of New Zealands have been quitted at £8 10s, and the latest selling quotation is £8 12b 6d, with buyers at £8 Bs. Nationals are sought for at £5 4s 6d, and sellers hold out for £5 7s.

The solidity of the Auckland Gas Co. is attested by the rush of shareholders to take up the 1000 paid-up £5 shares which were offered. No less than 2480 were applied for, and the directors allotted 1306, at an average of £13 16s 3d per shares. In the open market buyers are offering £13 15s, with sellers unwilling to part.

Auckland Trams have been done at 21s 3d and 21s, and are still inquired for at the latter figure.

New Zealand Portland Cements are still popular stocks. The latest sales were at 35s 6d for old issue and 29s 3d for new.

Most mining shares that were firm last week have since eased. Though money is easier, and investment stocks are better, mining shares are lower. No improvement is likely until more of the precious metal is unearthed.

May Queens seem a little better since the penny call was struck. Sellers Is lid, buyers Is Bd.

Rumours concerning the Saxon have subsided and so have the shares. The public realise that there cannot be any startling news from a mine that is not working. Sellers Is 7d, buyers Is 6d.

Victorias, Waiotahi and Waitangis are stationery but firm.

Old Hauraki sales ll^d, call paid Sellers Is, buyers 10£ d.

A little business is doing in Champions. The Taranaki holders are willing to go one better, and provide the money to erect further machinery after the present company is wound *up. Sales in contributing shares at Bd, and paid up at lid.

The Karangahake spurt up to lid only lasted two days. There are sales now at B£d and Bdi There are more reefs and more assays ahead yet. Sellers 9d, buyers Bd.

Tairua Broken Hills are down to Is and Is Id, and should be a good spec at that price. The market closed at sellers Is 2d, buyers Is.

Mountain Kings are very quiet. Sellers Sjd, buyers Bd, and no sales

Waihi shares have improved to £9 Is. Sellers £9 Is, buyers £9 0s 6d. • • • Waihi Grand Junctions are very steady. Price does not vary more than 3d. Sales 2(3s and 26s 3d. • • ■ Talismans, 46s 6d, 46s 3d. They are not ovfcr their troubles yet. • • • Tairua Reefs sales 4^d and sd. These depend on the Golden Hills.

The most absent-minded man up-to-date is a certain professor labo, with his wife, went for a trip in an excursion steamer. The steamer 1 was wrecked, and the professor swam ashore and rescued himself, and then swain back and rescued his wife. Old lady to chemist : "I want a box of canine pills." Chemist : " What's the matter with the dog ?" Old lady, indignantly ; "I want you, to understand, sir, that my husband is a gentleman !" " Oh, certainly, ' madam !" — and he handed her some quinine pills. "Waiter (seeing dissatisfaction on guest's face) : '' Wasn't the dinner cooked to suit you. sir ?" Guest : " Yes, all but the bill, .lust take that back and tell them to hoil it down a little." '' Did you ever get so mad that words failed you ?" " Yes — once." " "When was that !'" " Just one-eighth of a second after I called a prize-fighter a liar."