SHARES AND MINING

Observer, Volume XXXV, Issue 20, 23 January 1915, Page 20

SHARES AND MINING

rt HE condition of the London I market is as satisfactory as 1 one -could wiish, considering the abnormal conditions that exist The Bank of England returns last week disclosed great strength The metal reserve increased by £440,000, the reserve of notes and coin increased by £1,214,000, but, as the Government deposits were larger by over £21,000,000, the proportion ot reserve to liabilities did not show any increase. The strength and buoyancy of the money market wives one a comfortable feeling as ft is obvious that the funds for financing the war are available. a •• " Few people can have any conception of the enormous cost of this great European wai'. It is estimated that it is costing Germany and France each £3,000,000 a day, and the cost to Austria, llussia and Great Britain is at least £2,000,000 a clay. These costs cover the expenditure on arms, ammunition, equipment, transport, food' and other expenses incidental to maintaining w\,ops in the held. Assuming that tne wai- commenced at midnight on August 3rd, then we can make a rough guess at what has been spent. From August 3rd to January 22nd is a period ot 172 days, and, ulie daily expenditure of the five principal belligerents being ££12,000,000, the cost to date is approximately The ' expenses of Servia, Montenegro, Turkey, Belgium and Japan, who are also belligerente, should be taken into account, but their totals would be relatively small, and, if we place their aggregate at £3,000,000, we would probably be under rather than over the mark. This adds another £75,000,000 to the total. There is further the expenditure of neutrals in mobilising, which amounts to a good round sum. » • « Ihe enormous war expenditure of the belligerents is benefit ting several neutral nations, and producing countries that are able to maintain their export trade are doing well. New Zealand, being a producing country, and being able to export its food products without any trouble, is therefore doing remarkably well. Evidence of this is forthcoming in banking figures. The three months, October, November and December, were in full glare of the war, when perhaps the purchases for war purposes were exceptionally heavy. The result for us is shown in the deposits for the December quarter, as compared with the corresponding quarter of 1913. The cost is so- huge that it is> difficult to see how it can be continued for any length of time. Germany and Austria are feeling the pinch very severely, and both are short of raw materials. In short, both countries are feeling the economic pinch, and it is this pressure that is likely to end the war more quickly than the actual fighting. The position is decidedly precarious for Germany. a • • In the figures appended we give only the increases:—Free deposits, £381,604; fixed deposits, £1,082,----27 5; Savings Bank, £433,346 ; total, £1,997,225. The figures for the Savings- Bank are the excess of deposits over withdrawals. The deposits, as a matter of fact, were about £50,000 less than for December, 1913, but the withdrawals were over £400,000 less. The showing is remarkably good, and how anyone can feel pessimistic with these facts before nim passes comprehension. The coming year will trad© good in prac-

tically all its branches, and the alert traders will be looking out for a full share of this increased business. » » * The report of the Wellington Trust, Loan and Investment Company for the year 1914 shows that the credit at profit and loss account, together with £1,871 8s brought forward from the previous year, amounts to £16,003 Is, from which £5,625 has been paid as an interim dividend. The directors recommend that a further dividend of £5,625 be declared! on the paid-up capital, making 9 per cent, for the year; that £2,000 be added to the reserve fund, making the latter £66,000, which leaves £2,653 Is. From the depreciation account of £500 appropriated two years ago, £300 is written off for depreciation, the balance, £200, is added to the sum of £2,753 Is, making a total of £2,953 Is to be carried forward.