THE RATE OF EXCHANGE

Wanganui Chronicle, Volume 75, Issue 280, 26 November 1932, Page 6

THE RATE OF EXCHANGE

Sir, —What is the meaning of thu rate of exchangef 1 have asked men in all walks of life, and up to now have received only ambiguous replies even from those who walk around with the I know look. Therefore, I commit myself to the fol lowing analysis, it being only common place facts as have occurred to my humble intelligence. lam not a battler for the farmer anv more than for tho business man, but will try and take an unbiassed view and see who will benefit if the rate i s raised to 25 per cent., and who is going to pay on the one hand that the benefit may be received on the other. Let us take firstly the farmer, the man who is reputedly the backbone of our country, and on the positive fact that we are essentially an export country, he certainly has a claim to preference. Where does he stand? He exports 100 lambs and gets 10s per lamb —at present 11s for his product. Under the new rate of 25 per cent he gets 15 per cent more for the same lamb. But who gets the difference! 1 am inclined to think that the banks and stock firms and mortgagees in general will have all that and look for more. For where there is a carcase so the vultures will not be far away. And yet we hear tnat the banks arc opposing tho predicted rise. I wonder if all we hear is true. 1 do know, Mr. Farmer, that tho, extra rate was never meant for you. Now we go to Air. Businessman. 11 e buys £lOO of goods, but pays actually £125 or 15 per cent more than at pre sent for those goods. Naturally he puts it on his prices and up goes our living 15 per cent. He is not a benefit society and so we in fairness cannot expect him to do otherwise. As a result we tiow pay (under new rate) 23s 6d approximately for a £1 pair pf shoes. Of course, tho backbone of tho country are biivers of necessities and so it looks to my humble reasoning as though Mr. Farmer is not only going to feed the

powers that be, but he is going to be on the debit side as far as his purchases of necessities are concerned. If such is the ease there appears to be a flv in the ointment. here is it, and who scores? Hullo, as 1 write I can see the big backbone with no encumbrances getting a fair whack and a 8 his voice and weight tell in the contest he is making a pretty fair showing with our present administration. Then we have the banks, firms, etc., evidently riding the slogan “Nover let the right hand know what the left one is doing,’’ and finally into the picture comes the so-called .secondary industries. Are they going to put their prices up 15 per cent? Will a donkey refuse a carrot? And so T balance up to find a situation something like this:— Those to benefit are:— Banks, stock firms, mortgagers, and the big unencumbered farmers, etc. Those to par are:— Poor encuniborml farmer, business* men and workers generally. Referee, Mr. Government. It seems to me that the strong team has broadcasted to lose but has backed itself heavily on the outside to win. Tn fact team number one will do any thing but accept the only cure possible, which of course attacks their pockets. A short time ago 1 wrote you under the heading ‘‘Oppressed and Depressed" an article for the cure for the depressed state at present ruling and the following things must happen quickly and inevitably if we are to proceed with sound reconstruction: The price of land must come down to a price wriere production snows a rcasvnante margin of profit. Ttn» hoar J ers depositors must be made to disgorge, by legislation if necessary, and on the same principle that yon must not take every, thing out of land without manuring or putting some back, so fixed depositors must realise that they cannot expect to keep on receiving interest unless they are prepared to let some of their hoard ings go out again. The above are facts which must take precedence in reconstruction on a sound basis and all other measures are unsound and assailable. Temporary relief brings more trouble in invariably more acute forms, tho true reconstruction will temporarily embarrass everybody but mnst show i cry beneficial results in a verv short time. “VOICE FROM WILDERNESS.’*