The Waipawa Mail. Published Tuesdays, Thursdays, and Saturdays. Tuesday, April 13th, 1909. MONEY MARKET.

Waipawa Mail, Volume XXIX, Issue 5401, 13 April 1909, Page 2

The Waipawa Mail. Published Tuesdays, Thursdays, and Saturdays. Tuesday, April 13th, 1909. MONEY MARKET.

In dealing with the money market the New Zealand Trade Review observes:—“The first quarter of 1909 is now past, and the usual quarterly returns dealing with the finance and trade of the Dominion during that period will be looked forward to with considerable interest. Statistical tables are given to show that in the current season, so far as it has gone, the exports of wool, butter, cheese, mutton, lamb, and beef have been very substantially in excess of those for the same period a year ago; so that there is reason to anticipate that, in spite of low prices for some commodities, the quarter’s exports will show a very handsome total value, indicating so much money brought to the credit of the community. On the other hand, there is reason to believe that the volume of imports for the quarter, constituting the debit side of the account, will exhibit a substantial shrinkage, thus leaving a good margin of exports over imports. “ Attention is being drawn to the effect on the finances of the Dominion of the mortgage tax and the graduated land tax, as being calculated to drive money out of New Zealand. The Government borrows money on debentures at 4 per cent., and lends to settlers at per cent., paying no tax on mortgages. Capitalists and finance companies lending money on mortgage security have to meet this competition and to pay the mortgage tax of 6s 3d per cent. It is manifest that, under these conditions, there is little inducement for capital to be brought or left here for investment in this. way.

“ The graduated land tax, again, as now made applicable to city lands and to each shareholder’s proportion of interest in lands held by any company, is calculated to discourage the investment of money in such properties. A land-owner, driven by the heavy graduated tax to sell a large block of rural land, would find himself no better, or little better, off if he invested the money in urban land or in industrial companies occupying valuable land in their business. The primary object of this tax was understood to be to facilitate closer settlement, but for this purpose the taxation of urban land and land held by industrial companies is of no avail, arid tends to discourage investment, and so keep or drive capital out of the Dominion. It is felt that this should be altered.

“Early in March it was announced that the New Zealand Government had placed on the London market Treasury bonds for £"500,000, bearing interest at 3f per cent., with a currency of three years. It is said that the price obtained was slightly under par.

“ On the 24th of March the sum of £"270,000 was distributed in Wellington among the shareholders of the Manawatu Railway Company as part-payment of the purchase-money of that concern by the Government. This had some little effect in easing the local market. As to the general position, we think we may fairly apply to New Zealand the words

used in its latest issue by the Australasian Banking Record in reference to the Commonwealth, which are as follows :—‘The position is quite sound, but until banking resources are augmented a rather restrictive attitude in the matter of advances is likely to continue.’ ”