TOPICS OF THE DAY.

Waikato Times, Volume 117, Issue 19566, 3 May 1935, Page 4

TOPICS OF THE DAY.

Easins the Money Stream . _ For many months the spectacle has been held up to the American p,„pi. of. a huge reservoir of money im the Federal Beseye System disconnected from a huge reservoir of potential demand for that money by the people at large, The trouble has been held to reside in the pipe between the two. Somehow or other it had become oTtg haye bcen made to clear it, and the new banking bill essays what is regarded as the boldest innovation Under it money may be advanced to the banks on the security of ariy sound asset.” In view of the added provision that national/ like state, banks may make reai estate loans, a “sound asset” would include such loans. . ~ But the innovation is not as drastic as it appears, says the Christian! Science Monitor. One of thfi reasons for the Act of 1910 Which set up the Reserve System was the necessity of insuring an elastic and readily available currency. Money till then had sometimes been unobtainable during depressions. So the authors of the 1913 Act ushered in the Federal Reserve note, to be available at all times to the' banks in return for What are known as " eligible ” assets. These assets were to be “ notes, drafts, bills of exchange, and acceptances,” arising out of current business. That meant that currency supplies would rise and fall with business activity. * For this provision there was another object besides that of insuring an elastic currency. This wsiS the facilitation of commercial ' banking —with the emphasis on commercial, ’flic commercial banking System was held to be made for the businessmen. So the banks wore authorised to borrow from the Reserve System only on the basis of commercial paper, or “ notes, drafts, bills Of exchange, and acceptances.” The attempt to make money more available was defeated by Wartime needs. In 1910 an amendment to the act authorised a Reserve Bank to make advances to a member bank on its own promissory note secured by “ eligible ” paper Or United States Government obligations. Observe wlirit happened. Banker's obtained money from the reserve by borrowing on their own notes collateraled with government securities. Now the bill formalises and extends the departure from the old rigid standards of eligibility of the weapons,' or aSSCts, for tapping the Federal Reserve System. Any good asset may be transformed into cash. What is a good asset will be a problem for the Federal ReSe'ryc System to determine. GrCat are the new responsibilities of the system under this and previous New Deal legislation. The automatic checks on the credit flow frOm the system are now abolished formally. But they rvere checks on men as well as money. Their very removal makes sound banking all the more neeesary.

Energetic High Commissioner An energetic campaign of trade publicity for this country is being carried on in the United Kingdom by Sir James Pari’ and his Chief Publicity Officer, Mr H. T. B, Drew. Fresh evidence of it chides by almost every English newspaper mail. Scottish, papers to hand record a further incursion into that country,- where audiences have been given pointed and convincing reminders of what the trading goodwill of New Zealand means in material.wefilth to the United Kirigdoin. Last year y said Mr Drew at one of his meetings, New Zealand imported more British manufactures than any country in Europe or any foreign country in Asia. If Canada had bought at the sairie rate her purchases last year would have been worth £77,000,000 instead of £20,000 y 000. Another good point made in the Scottish campaign was the emphasis laid on the fact that the New Zealand export trade, in its demands for ocettn freights,- was a very good thing for British Shipping and shipbuilding. Incidentally, the campaigners have not forgotten to saya word about New Zealand tourist attractions, 'file value of this concentrated, publicity work is so obvious that it may be questioned whether the Government ttftd the produce boards are doing enough of it. Our trade competitors arc by no means idle, and their resources are substantial. If we are to hold our Own We must meet intensive publicity with commensurate efforts. Mitch has been and is being done. Is it possible to do more? —Dominion. Aryans and Non-Aryans

When tlie newly-appointed Japanese Ambassador in Berlin, Count Mushakoji, was received by Hitler the other day he paid that “great leader,” as he called him, more than merely formal compliments. Herr Hitler, in his reply, referred to “ the spiritual kinship ” between Germany and Japan. The Japanese are not exactly an Aryan people, but, in the hew political jargon of Germany, the word “Aryan,” in so far ns it has any distinct meaning at all, is extended to people who are distinctly non-Aryan. The German official view is that no nation that might be useful at any time can be considered non-Aryans. Thus the Hungarians and the Japanese are by no means non-Aryans, because they are potential allies of Hitler’s “ Third Realm.” That is why lie is able to speak of “ spiritual kinship.”

Japan is not altogether a “ totalitarian ” State, hut is not far from it. She has a State religion, such as Germany is still trying to have, and, like Germany, she suppresses “dangerous ideas.” She also encourages warlike emotions in young arid old and is liable to tils of nationalist fervour.

But I here arc differences. The institutions of Japan have a venerable and dignified character, and whatever is hideous in Japanese life parades side by side with astonishing beauty. The new institutions imposed upon Germany by Hitler and his followers have all the outward characteristics of the “new rich.” Beauty, still a national cult in Japan, has been trampled upon and crushed and soiled in Nazi Germany. But for the time being Japan is regarded as by no means a non-Aryan country, for if the present antagonism between Berlin and Moscow deepens, then Japan will be. a helpful ally. On the other hand, some of the most influential of the Oernutn military commanders would like an alliance with Russia. If that comes about, the Russians will be promoted to the rank of pure Aryans, while *Ho Japanese will be degraded to non-Aryan' rank.