COMMERCIAL.

Press, Volume LXI, Issue 18362, 21 April 1925, Page 10

COMMERCIAL.

GOLD STANDARD. MR IMPKENNA'S SUPPORT. WHY IT IS BEST. (TEOU 017E OWN CyRHESPONDEKT.) LONDON. March 10. In an address to the Commercial Committee of the House of 'Commons, the Right Hon. Reginald McKenna, Chairman of the Midland Bank, dealt ■with that aspect of the restoration of the gold standard which it. of most interest to the.business community. Mv McKenna does not pretend to be an enthusiast; he is blind neither to the imperfections of the system nor to the difficulties which its lull readoption by this country may raise. It is Mr -McKenna's opinion that the supply of gold at its present value is rriore v than sufficient to meet the world's demands, and that consequently we .shall pass_ into a time of slowly rising prices, more activ* trade, and increased employment. The settled policy ol the Bank ot England, said Mr McKenna, had been to effect » steady appreciation of sterling with a view to attaining parity ■with the dollar and the restoration of the gold standard. He was opposed alike to -inflation and deflation. Both were evils to be avoided: the one was unjust to the creditor, the other no less to the debtor. He was in favour of a stable currency, which alone could secure justice to all classes. The point to examine, he continued, is whether, if wo return to the gold standard of 1915", the conditions of the supply of gold and the demand for it are such as will, lead to a resumption of the course that trade was pursuing down to 1914. So far as I am able to judge, I should say that the supply of.gold at its present value is more tban< sufficient- to meet the world's demands, ; and that consequently we shall pass into a time of slowly rising prices, more active trade, and increased employment. I am hv no me?.ns bljnd to the possibility and even probability, that j we may have many difficulties to encounter in the early days. ! Initial Difficulties. I ; The effect of our past policy in at- { tempting to force the appreciation of oiir currency, whether by restricting j credit, by charging higher rates for i money than are current in the United States, or by discountenancing the issue of foreign loans in our market, has been to create a situation which may have a serious reaction when we first get back to gold. Large balances held here on American account may be sold with an immediate" impact upon the exchange. The foreign issues which have been held- back may bo brought out with a rush. Our - gold- reserves may be imposed in order to secure our position, lit thes6 circumstances sterling exchange is at the moment in the same condition l as the Stock Exchange when a heavy bull account"is'hanging over the mar*, ket. \ But all : these are matters only, of temporary importance, and we havo to look behind market conditions to the long period trend of values. If we do so, I Delieve that reversion to the gold standard will eventually be attended bjr an influx of gold and an improvement in trade. Sovereign's Day Delayed.

It was often supposed that reversion to the gold standard would mean that; the •gold sovereign , would once more pass into circulation. If this were allowed to happen, he was afraid that it would (be disastrous to our prospects. It waff estimated that before the war gold coin ' was in circultion to the value of , €120,000,000. To-day, at the higher evel of prices the total required, if the Treasury note disappeared, would certainly be over £200,000,000. Thi s ,would create such a demand for gold as .. would raise its value. It would be a shock to the Chancellor of the '• who -would have to pay for £ Mt; \and it would be injurious to our • as it woulcTTmmediately cause a -•■ fall in prices. The gold would' be by the Exchequer, and not by Bank >. of England, and" \>&uld not ,rfentail therefore any expansion of credit. The Treasury note was nominally oon..vertible into gold, but t'liis provision of jjjour law had in practice been only a presence, and the 'sooner the law was into conformity with, the facts „Jthe better for oui" aalety. The indiscondition of a true gold stand,rard was that we should have freedom

• ; ,..of export, so that -when a demand was vmade upon us to,pay our foreign debts? - .in gold we could do so without leave or license. Convertibility into bullion for ' - export was one 'thing', convertibility of " individual notes into minted sovereigns v ,was quite another. Until we could af- " ford' it better than wo could -now, he would not risk any demand being made for gold merely for internal currency "purposes. What Do We Gain ? "-.Where do we "come in?" asks the . "Daily Mail," in" a leading article. ' "Hie United States and its Federal Reserve Banks " already .. have about £900,000,000 of the world's gold, and, .• as-Mr McKenna tells us, there is 'an 'excess of upwards-of £300,000,000 over logal requirements.' That the United States and its Federal Reserve Banks ;" H'tjuld gain by: inducing us to take a ,large part of tliis gold from them is r-.pretty obvious. ' What we 'want to " Jcnow, and what the British public i-'wants to-know is": What is the precise advantage; to this country of such a '.' transaction ? Each million 0 f gold bur- ■ ried in a vault nieans that some £50,000 a year in interest (taking the rate at 5 per cent.) is sacrificed.. If L - .£900,000,000 is so- entombed' there is a •' - loss of £45,000,000 annually. What ■ J have we to gain by sharing this loss?"

. FAT STOCK FOR EXPORT. The New Zealand Meat Producers Board bdviees that the following ""prices, were being offered last week for fat stock for'export: Hawke's Bay—Prime woolly lambs, 421b and under, lljd; 431b and over, lid; second .- - quality, lid. ' Wellington—Wethers, S6lb and under BJd" , prime woolly lambs, 421b and under,' 12d' "43!b and over, 11 Jd; second quality, 11 Jd Canterbury and North Otago—Prime woolly ..lambs, 361b and under, 12d; 37 to 421b, ll*d • ; -."431b and over, lid; second quality llJd* ' FROZEN MEAT. The New Zealand Lean and Mercantile Agency Co., Ltd., has received the following cabled iidvico from DondonNew Zealand frozen.' meat: Lamb, 11 jd per lb (average); .mutton, wether and maiden ewe, iislit ...per lb, heavy 7d r>?r lb; e», li?ht 6}d per lb, heavy 6Jd per 11>. Better market. « DAIRY PRODUCE. ' Messrs A. H. Turnbull and Co. have received the- following cabled advice from London:—Danish butter, 185s to 188s (last week -••r 2003 to 2045); N.Z. unsalte - !. 172s to 176s > : •U7ls'to 1765); N.Z. salted, 164s to 165 a (164s to 1665). Market slow. Cbecse, white and coloured, 101s to 102s (101s to 102s). Market ;:"-.. Bteady.- ••

PICTON FREEZING WORKS. A PROPOSAL TO PURCHASE DISCUSSED. (special to "the . pmss.'') BLENHEIM, Aprii 20. The suggestion has been advanced and tentatively discusEed that the I'ictcn freezing worics should, bo purchased, by the farmers of Marlborough and run on the co-operative principle. It was strongly opposed by Mr A. J. Mil.';, the -newly eiect-ed president, at the annual meeting of the Blenheim brunch ol the Farmers' Union. ''l don't say we can't do it, but it would be the worst day 3 wort the farmers of Marlborough could ever do," he said in moving that the farmers of the province be urged to support the Picton worts. Mr Mills said that despite all that had been urged to the contrary, ho considered that tho prices agreed "to (between the Refrigerating Cojnpany and the fanners' freezing committee, were very fair. The farmers could not expect freezing charges at Picton to be as low as those ruling at Christchurch, although it was claimed the Picton works enjoyed advantages in respect to cheapness of coal and shipping. The 'vhole question of charges hinged on wages and other expenßSS in connexion with the works. He believ<& that the company was trying to help tho farmers.. The only remedy for the high charges now prevailing was to increase the output of the works. They could not run economically on the amount of stock at present handled, because they were working so spasmodically. The great aim of the pastoralists should be to raise the output to 150,000 head next seaeon. i Lambs wero essential to that end and better pastures and fodder were required. The chief object in fattening lambs should be to get them away for the opening of the freezing works before Christinas. There was no more paying business than the rearing and fattening of lambs for export, even on a, moderately sized farm. Regarding the refrigerating company's new scheme of buying stock on a schedule of prices, Mr Mills asserted '.hat the company had improved the prices of lambs by 4s a liwd this season. He was by no means, adverse to the principle of buying on the farm, as opposed to auctioning in the sal© yards. Fat sheep deteriorated in the yards, aa they were knocked about, and it was more or less a gamble whether the prices realised would be as good as those offered by the company. He would not put a penny into a company to bnv.the Picton. works. He was a member of the old "Wairaai Company, and they vero only too pleased when kelson Bros, came alon<j and bought them out. Marlborough people did not have the faculty of holding together and any co-operative coiicern would fall through in a few years. Mr- W. M. Smith, the ex-prcsident, said that he knew that the men who were advocating buying the works now were fastening stock for export. The big runholders tverc not doing their bit, lis they would, not gx> to the trouble of working teams and breaking up land for fattening fodder. They were quite satisfied with their wool prices and the big prices they wore getting for etor« sheep without topping them off. "I don't know why people are worrying about barley prices when they can get 36s to two guineas for fat lambs," remarked Mr A. O. Hammond. "They have only to etart fattening lambs and they will not worry about barley or anything e l® e - The secretary (Jar R. "Wanden) stated t-iiat the ■ Refrigerating Company fhtended continuing its present buying methods for two more seasons, as it believed it wou-d take that long to develop the system. After that, if tho works still failed to pay, the company would have no option, hut to aiscontinue operations at Picton. . The president's motion wae then carried unanimously.

BARLEY-GROWING CONTRACTS. FARMERS RECOMMENDED NOT . TO SIGN. (gPICIii TO "the • MUSS.") BLENHEIM, April' 20. "That the fanners of the district bo recommended not to grow barley on contract as the price offered by New Zealand Breweries Ltd., viz., 5a per bushel, is, in the opinion of this meeting, not a remunerative one. ' This was a bsolution adopted at the annual meeting of the Blenheim branch of the Farmers' Union. The branch, the members of which include most orf the leading growers of Marlborough, has for some time teen negotiating with the brewers in an effort to improve the conditions of barley and in co-operation with the Seddon branch, which also represents a large number of barley producers, it achieved several advantageous changes in the terms of the contract notes, toothing could be attained- however, in the matter of an improved pnce. New Zealand Breweriee, Ltd, stating that they' were unable to increase the »nco to more than 6fc a bushel. . The secretary (Mr R. Wanden) informed the meeting that he had conferred with representatives of the Seddon branch and he had learned that that branch would support th« Blenheim Union any effort to gain an advance in pnce. e , t l ? g to do was to show a unitsd front and mako it plain to the brewers that their price was considered insufficient. . ■\£ r \V H. Gnne moved, and Mr J±. o. Reeves seconded the resolution quoted above, and it was adopted unanimously. Tho mover claimed that the farmers had a right to hold out for a reasonable price. It was known that free barley had brought anything up to 6s a bushel, and there was no why tha contract price could pot be bettered. Mr Reeves eaid that he hoped the growers •vould stand by the Union to a man, but he was afraid that ihere would be some who would sign contracts m spite of what they had been advised to do. He had heard of one man who had already contracted: to grow £O<J acres at 5s <a bushel. f Mr "Wanden said it was all a question of •uhother the farmers considered tho a"" 4l *?* price remunerative or not. Ho hehovrf it fl-aa „ot, therefore the line of action the bwneh recommerded was the only one to follow.

MEAT EXPORT. The New Zealand Meat Producers' Board advises that New Zealand meat shipped during the season is ae. follow - Beef Mutton lamb , M , Qrs. C-cs. C-cs. November 13,510 110,381 27,194 U Member .. H,™ 204J46 U December 19 ■ •• 7 .* 80 108 " 173 380,325 5 ,S ' .. 12,6" 290 i 13 M S b rc T y ■ 27.898 209,102 373,425 U March •• 4,133 73,141 859,825 1,690,285 U 25,256 9,332 U, United Kingdom; G, Genoa; H, Hamburg. Killings at all works during the season up to March 81st were:— North South Island Island Total. Beef (qrs.) •• 237,446 5,684 243,130 "Wether mutton (C-cs.) .. 934,344' 88,698,1,023,042 Ewe mutton (C-cs.) 540,894 122,962 663,856 Lamb (C-cs.) . - 1,739,212 1,555,523 3,294,735 Pork (C-cs.) .. 25,708 321 26,029 Boneless beef (fit. (C-cs.) .. 114,673 24,754 139,427 Sundries (frt C-cs) 24,197 3,511 27,708 Stocks on hand in New Zealand at March Slst were:— Nor tli South Island Island Total. Beef (qie.)- .. 142,013 4,742 146,753 '."Wether mutton C-cs.) .. 395,965 55,916 431,881 Ewe mutton (C-cs.) 293,563 98,566 392,129 Lamb (C-cs.) .. 534,980 700,656 1,235,636 Pork (C-cb.) .. 9,186 321 9,507 Bonejess Beef (frt. (C-cs.) .. 67,906 15,875 83,781 Sundries (frt. C-cs.) 15,786 2,817 18,603 Stocks of frozen meat loaded into steamers not departed from New Zealand as at March 31st -were:*—Beef (quarters), 50,343; wether mutton (Oca.). 44,837; ewe mutton (C-cs.), 54,361; lamb (C-cs.), .395,343. THE PROPERTY MARKET. Jones, HcCrOotie Company. Ltd., «xd by 1-üblic auction' yesterday, on the premises, ■No. 116 Hawke street, .New Brighton, the properly comprising a bungalow of 5 rooms, together with u-quarter acre of land, to Mis<i Vuthb?rt, for £IOSO.

CHRISTCHURCH STOCK EXCHANGE. YESTERDAY'S TRANSACTIONS. Sales Reported—X.Z. Government. 1J per cent-. Bonds, 1935, X9ts 15s* N.Z. Refrigerating (paid), 20s 3d; Manning Brewery, SBs (two parcels); Beath and Co., 33s 6d. LATEST QUOTATIONS

OTHER EXCHANGES. (fmss association tmobams.) AUCKLAND, April 20. Salear-Soldieru (Inscribed)' . £IOO 15s; South British, '46 a 9d; Auckland G *a, 233 <td- Kauri Timber, 33s 6d; Sanfords, 19a. WELLINGTON, Ap#l 20. Sales Reported—lnscribed Stock, 1938, £96 17s 6d: Inscribed Stock, 1933, £101; Abrahams and Williams (ord.), £4 2s 6d; Taranaki Oilfields, £1 9s.

Buvers. Sellers. i s. d £ a. d. -\.Z. GOVT DEBii.VnntKS— per cent. Inscribed and Bonds, 1938 and 1933 9G 15 0 5 per cent. Bonds, 3S27 98 2 6 — per cent. Inscribed, 1933 100 12 6 101 5 0 5S per cent. Bonds, 1933 100 15 0 101 5 0 OTHER DEBEtNTUEES"ft'aim.iiri County. Gi per cent. — 103 0 0 Christchurcli Tramways, 5i per cent. 97 0 0 — Christ-church City, 5 per cent. .. — 91 10 0 Ashhurton Electric Power, per cent. — 98 10 0 Christchurch Drainage, 5i per cent. ST 10 0 — Glaxo, Gi per cent. .. 83 0 0 — Is.Z. Breweries, Stock.. — 1 2 0 N.Z. Breweries, Bends . — 1 1 10 BANKS— Adelaide S 7 0 8 10 0 Aust. Bank of Comm. 1 7 G — Bonk of Victoria G IS 0 7 1 6 Comm. of Austiali a, .. 1 7 6 — Comm. of Australia (pref.) — 6 Id 0 National of Australasia (f 10 paid) lli 1 0 16 4 0 National of Is .Z. 6 14 9 6 16 0 New South Wales •10 17 6 41 7 6 !>Tew Zealand .. •> 13 9 2 14 0 .New Zealand (new issue) -> 12" 6 2 13 0 Union of Aust. 14 1 6 11 3 0 i:vsi.;i:a>ce— Hational .. .. 3 10 3 3 12 G

New Zealand 1 11 3 — South British . < 2 a 0 — LOA;S A-Si) aG-ENCY- 1 - Dalgety and Co. 15 7 6 15 12 6 Gcldataongii, Mort 2 7 3 2 8 0 National Mortgage — 3 18 G Permanent Investment — 10 0 0 SilXi* JSi' Q — Howard, Smith 1 15 3 — 0 P. and 0. Deferred 265 0 0 300 0 FK0Zr,N MEAT— Canterbury — 14 2 6 Cre-IT 2 3 6 — N.Z. Refrig. (paid) .. 1 0 2 1 0 9 N.Z. Refrig. (contr.) 0 10 0 0 10 6 WOOLliJ^Nh— Xaiapai (oid.) 0 11 9 — Kaiapoi (contr.) .0-5 6 COAL— Stockton (pref.) ' — 0 5 6 GAS— 7 15 0 ChTistcliurch .. 7 12 6 Napier* (£10 paid) 10 17 6 — BREWERIES— Crown 1.14 0 1 18 Manning » 1 17 6 3 "Ward .. — 2 17 0 — Kauri .. •• 1 13 0 1 13 G iliooi-^ljIiANEOUS— Beath and Co. 1 12 9 1 13 6 Beath, Schiess 0 7 0 — British Tobacco 2 1 0 — Burns, Philp 1 16 3 1 1G 9 D.I.C. (ord.) 0 35 G 1 8 Electro. Zino (preL) ... — 0 Electro. Zinc (deferred) — 1 7 3 Mason, Struthers (i'l 0 paid) 1 13 0 1 14 Mason, Struther9 (14s 0 16 paid) 0 15 6 0 Mason, Struthers (103 0 12 paid) 0 11 3 0 N.Z. Drug Co. 3 4 6 3 7 6 N.Z. Farmers' Co-op. (£5 paid) — 2 8 0 N.Z. Farmers' Co-op. 0 12 (£2 10s paid) — 6 N.Z. Farmers' '- .Co-op. (64 per cent. Stock, 89 0 1930) 36 e • 0 : N.Z. Ftvrmei*' Co-op. (61 tier cent. Stock, 85 0 1935) — 0 N.Z. Guarantee Corpn. 0 9 6 0 10 3 N.Z. "ivriTV Products .. 1 7 0 — N.Z. Paper Mills 1 0 3 — Taranaki Oilfields — 1 9 6 MINING— • 11 8 M-fc. Lyell w ; 1 1 0