The Waikato Times With which is Incorporated The Waikato Argus. TUESDAY, JULY 14, 1925. THE BANK RETURNS.

Waikato Times, Volume 99, Issue 16545, 14 July 1925, Page 4

The Waikato Times With which is Incorporated The Waikato Argus. TUESDAY, JULY 14, 1925. THE BANK RETURNS.

The bank returns which have been recently published disclose a satisfactory position, and give evidence of the increasing prosperity of the country. The Bank of New Zealand holds about one half of the free and fixed deposits of the country, and makes about threesevenths of the advances. The free deposits have increased by 7 A per cent, and the fixed deposits by 8* per cent. Government deposits on the other hand show a considerable decrease. The advances and discounts of the Bank of New Zealand arc a little over £19,000,000, against free and fixed deposits combined of somewhat over £2-5,000,000. The margin was ample so long as the gold standard was not restored, but will hardly be considered sufficient under the changed circumstances. Conditions in Australia arc reflected in the trading of the Australian banks. The demand for cash has been keen in Australia and rates of interest high, and in accordance therewith we find the advances and discounts of three of the Australian banks show some slight decrease. So far as the stability and prosperity of the country are concerned the figures are entirely reassuring. There are, however, one or two tendencies which they seem to indicate that deserve attention. In the first place the .proportion of discounts to advances is extremely small, being less than one-twentieth. This poinls to a small amount of trade conducted on sucli lines as are common in the Old Country. Conditions of course differ from one place to another, and it may be that the Bank, prefers to make advances on overdraft rather than discount bills. There is, however, a good deal to be said for the latter method which indicates a more settled and steady trade. The other point which emerges from the Bank returns is the large amount of money on fixed deposit. A certain amount of this may be local body money, raised on loan but not wanted at once, but the total or such deposits is probably not large. There is over £21,000,000 on fixed deposit, which would seem to point to a poverty of imagination. The rates paid by Hie Bank are not high, yet obviously many people prefer to take them rather .han invest in any of the "ilt-edged slocks which arc offering. Do these investors expect that there will be a fall in the quotations for giltedged stocks? It is impossible to dogmatise about the future, but all the itldica tions point to 'lower interest and higher prices for slocks. That is a matter which the investor must dccide for himself. The Government,. However, should take note of the amount or money on fixed deposit. Out or the tola! of £21.000,000 it should have been possible to find a .considcr,hl„ IKl rt of the £7,000.000 for which we floated a loan In London. It cannot i,o said that the country requires m nrc cash, and.it is a question whemcr Lhero in not too much already. If land settlement, were proceeding vigorously cash would certainly be wanted, but that is not the case, and :, mdcr existing conditions the QovernI mcu t might well have raised the money i in the country.

New Zealand is showing many of the symptoms of middle age. A very large proportion are living without work. They have realised enough to keep them, and now merely amuse themselves with speculations, commonly in land. When this stage has been reached by an elderly man everyone is pleased, but the situation is somewhat different when a man in the prime of life gives up active work. In 100 many cases the income on which he enjoys life comes from the labours of someone who has paid an inflated price for land, and it is such money that swells the fixed deposits. The great complaint in older countries is of the vast difference between the rich and the poor. The cry that the poor arc growing poorer is nonsense; their position improves year by year, but at the same time the distance between the man who lives on rent or interest, and the other man who lives by labour tends to grow greater. New Zealand is showing many of the same symptoms. In years it is a young country. Its land settlement is far from being completed. Its population is small and is not growing with any great rapidity. Yet land is available, money is plentiful, climate is favourable, but the people prefer to take their ease and to enjoy life. Something of the spirit of the South Seas has Infected them. We are all products of the soil to a greater extent than we realise. And while money is piled up on fixed de 7 posit we see by the papers that a constant succession of small companies are floated, usually with little capital. The promoters are casting round for the means of improving matters. In many cases they will fail for want of sufficient capital. We complain of the Yankee for hustling, and truly it is a method that can be overdone, but a certain amount of it lends a flavour to life, and leads to satisfaction at a later date. The Bank returns point to the fact that wealth is plentiful; it may also be well spread, but at the same time they create a suspicion that wc have given up the strenuous life too early in the history of the country.