MILLIONS WILL BE WRITTEN OFF.

Star (Christchurch), Volume XLIV, Issue 144, 19 June 1931, Page 5

MILLIONS WILL BE WRITTEN OFF.

ADJUSTMENT NEEDED IN STANDARD OF LIVING

(Special to the “ Star.”) _____ WELLINGTON, June 19. 14 Despite increased production, the shrinkage of many millions in the total value of exports denotes how seriously this country has been affected by the present world-wide depression,” said Mr William Watson in his address at the annual meeting of the Bank of New Zealand to-day. “Almost every class of the community has suffered, sheep farmers most of all," he continued. “ Traders have been working on an inadequate margin of profit or have made no profit at all; indeed, in many cases severe losses have been sustained. People who are dependent on dividends from joint stock companies have had their incomes greatly reduced. Unemployment is serious, and will continue until labour can be profitably employed. “ That there will be a return to the prices of a few years ago is most unlikely. Values of our assets must be based on the competitive value of our products in the markets of the world, and standards of living adjusted accor*lingly. “A great many persons who have enjoyed substantial incomes now find themselves without any income and forced to trench on capital built up in most cases by years of industry and self-denial. If they have not the' necessary means, they must, regrettable as it may be, reduce their standard of living—in short—the coat must be cut according to the cloth. If the standard of living can be improved in countries which compete with this country in the markets of the world, then the standard in the Dominion can be correspondingly improved. By the time the country settles down to a sound basis, very many millions will have been written off existing values.

“ The recent 4 cut * of 10 per cent in salaries and wages will, in manv instances, inflict more or less hardship, but I w’ould emphasise that n great many persons have been obliged to face losses far in excess of 10 per cent.”