Vogel’s New Idea.

Wairarapa Standard, Volume XVIII, Issue 1682, 30 March 1885, Page 2

Vogel’s New Idea.

We recently pointed out that the scheme of Sir Julius Vogel for providing cheap money to be lent by companies to settlers for improving their lauds, was open to the objection that if the company borrowed in large amounts at £4 10s per cent, and lent out iu smaller sums at £5 10s per cent, the margin of I per cent was too small to pay working expenses and afford a profit to shareholders. There is another point still to be considered. Sir Julius Vogel's proposal is ostensibly put forth to benefit country settlers who are supposed to be weighed down by the interest which they have to pay to money lenders. At present a country settler can borrow money on the security of his land up to twothirds of its selling value, at 7 per cent. If the transaction be large it is probable that Bioney cap be bad at

6| and even 6 per cent Money is plentiful and the tendency of interest is downwards. Now, Sir Julius Vogel’s idea is to have a lot of companies advancing money to settlers at of per cent. The difference between and per cent is so small that it seems hardly worth while adopting all the expensive machinery of Sir Julius Vogel’s scheme, to make money so very slightly cheaper. In fact we do not believe that expensively worked companies could exist by lending money so low as 5| per cent, and that the whole scheme would speedily collapse.