FINANCE AND COMMERCE.

Press, Volume LXVI, Issue 20100, 2 December 1930, Page 12

FINANCE AND COMMERCE.

WOOL SALES. SYDNEY MARKET FIRM. AVERAGE PRICE LAST WEEK 8.3d PER LB. ftrrTTBB PSJS6B ASSOCIATION—S! BLBCTSIC CTLEGBATH —COPTRIGHT.) 'Received December Ist, 9.46 p.m.) SYDNEY, December 1. At th« *OOI sales the offerings tods* were 10,716 bales, of -which 9992 were sold, also 675 which were disponed of privately. The average price of wool last week was 8.3d per pound. Th© market to-day was very firm. Competition was strong 011 Japanese and Continental account, and there uas a limited enquiry from the United States. Greasv merino made up to 2id. ' LOCAL WOOL PRICES. GERMAN COMMENT. [THE PRESS Special Serrice.] -i'UCKLAND, December 1. '•They pr.id too much." This was the frank cimment of Mr Otto Sommer, a wall-known German wool-buyer, who arrived by tho Aorangi yesterday. He was speaki lg of the prices realised at the recent wool sales in Auckland and Wanganni.. "It is .. result of the world depression," he «added. "We do not like to see these low prices any more than yonr growers do. We lost money last year, ani nobody knows what will happen. thv» year." the manufacture of synthetic wool .*jiything to do with the matter?" he wag asked. "Vothing at all," hj« replied. "It if the world-wide slump, and nothing else.'' Mr Sommer left by car for Napier, to be present at the wool sale there. AMERICAN CONDITIONS SOME ENCOURAGING SIGNS. Some encouragement is to be derived from, business developments in the laßt fweeks, states the Guaranty Trust Company of New York in the October iwua of its monthly review of business and financial conditions in the United States. The pronounced recession that characterised ousinees activity in almost all lines throughout the lat© spring and summer has given way to irregularity, with positive improvement in some branches of trade and industry. "On the whole, the behaviour ot commodity prices in the last three months has presented an encouraging contrast to the consistent weakness that was evident during the first seven months of the year. Recent movements have covered a comparatively narrow range, suggesting that the readjustment, if not actually completed, Jg at any rate far along on its course. This view is strengthened by the attitude of leading consumers of industrial raw materials, who have shown an increasing tendency to cover their needs afc existing prices. "Among the most encouraging business reports that have appeared are the improvement in sales of new life insurance during September, the increase in raw cotton consumption, the rising level of residential construction contracts, the advance in foreign trade, and the large amount of current dividend payments as compared with the total a, year ago,_ notwithstanding the numerous reductions and omissions of dividends recently reported. In connexion with the textile situation, it_ is worth noting that both sales and shipmeats of standard cotton cloths last month were greatly _ in excess of production, resulting in a marked improvement in the statistical position of the industry. ."Recent financial events have been such as to confirm the general expectation that the money markets will continue in the easy state that has been shown for several months. There has been a considerable seasonal increase in commercial bank loans, but it has been largely offset by the decline in security loans, due to the downward movement of stock prices. The active export gold movement apparently has definitely ceased. In the absence of an unexpectedly large expansion in the use of commercial bank credit in the near future it is reasonable to assume that exceptionally low rates will remain the outstanding feature of the money situation for some time." MEAT FOR EXPORT. (CZZSS ASSOCIATION" TELEQBUi.) HASTINGS, December 1. This morning the meat exporters of Hawke's Bay announce a decline of the price on hooks at local works afl follows: —Lamb, from 7jd to 6d a pound; first-grade wethers, from 19s to 17s; first-grade ewes, from lis to Ss 6d. KOMATA REEF MINING. REDUCTION OF CAPITAL. (raoit otro omt cobmspondewt.) ' V LONDON,. October 23. Mi- Justice Bennett, on October 21st, heard tho petition of the Komata Reef Gold Mining Company for permission to reduce its capital. Mr A. G. Nesbitt, for petitioners, said the company was formed originally to work gold mines in New Zealand, and its history had not' been satisfactory. The- present capital waa £40,000 in 80,000 .10s shares. Counsel read an affidavit of Mr Whitfield, chairman of the company, stating that at least £321,000 capital had been lost 01- was unrepresented. by assets. The company , had large i'hvestmentg in the Western Frontier Golddeldki and the only investments showing any valuer amounted to £BOOO, while, there was a bank.balance of £77. The liabilities were .£l67s, so. .that there was a surplus of £6051. It -was proposed to writo down the capital by four-fifths and to reduce the 10s shares to 2s each. There would then be 80,000 shares of 2s each, and they were going to get fresh money. His Lordship: They seem to have invested in.gramophones among other things. Mr Nesbitt: They do not seem to have bei.ri' »o unfortunate in that department as in their main investments. REILLY'S CENTRAL PRODUCE MART, LTD., DUNEDIN REPORT. Apples, Sturnjers,"showing waste, 7s, 10s; Ucliciona Bs, 12s, Crabs, 9a 6d; pears, Coles 4d, od; Js'elis sd, 6d; potatoes, 3id, sd; gieen peaß, s ld, 6d; tomatoes, firsts Is 10d, sfconda Is 6d, Is 9d, thirds le 2d, Is 4d; gooseberries; choice 5Jd; cherries, Is 9d, '2*'4d; *t'raWberties, 1& 7d, 2s sd; porker fctteon.-pigs^.Bjd;. section bon«y, 12s; asparajflM, lettuce, extra oboice 3a, 4s, otEers Is; cauliflower, .choice' Shi, 12s oabWge, 2» 6d, 3« 6d; . cucumbers 14s, 16s; ■fling- carrot* -.-/ anted, la 3d; white ' turnip" 2i 94 j 1m ,2d, l*,3fL dowia, —8

FREEZING WORKS. ONE TO OPEN TO-DAY. BACKWARD SEASON DELAYS COMMENCEMENT. One of the freezing works in Canterbury, that of T. Borthwick and Sons (Australasia), Ltd., will open to-day with board of about lo slaughtermen. This will be the first works to open in tho province this season, and the date of the opening of the other freezing works is doubtful. There is no definite information available yet as to the schedule of values to be paid for the first drafts of lambs. The New Zealand Refrigerating Co., Limited, stated yesterday, that in view of the backward nature of the season, which has resulted in fewer lambs offering at this period than in previous years, there has been no definite date "fixed for opening the works at Islington, but there is still a possibility of work being commenced before Christmas. No information is available concerning tho intentions of the Canterbury Frozen Meat Company, Ltd. WORLD PRICE LEVELS. EFFECT OF GOLD. ABSORPTION BY TWO COUNTRIES. (UNITED PBE6S ASSOCIATION—BT ELECTRIC T.ELEGRAPH —COP YBIGHT.) LONDON, November 30. The eSect of gold on world price levels was the subject of a broadcast address by Mr Reginald McKenna (former Chancellor of the Exchequer, now chairman of tlie Midland Bank). Great interest Was taken in the address, in view of increasing attention being given to the monetary policy. Mr MoKenna explained that a failing price level means a diminution of the profits of industrial and trading enterprise. "The effect if a. fall comes when profits are not excessive is to stiflo trade," he said. ''On the other hand, a rising price level imposes an increased duty on all fixed money incomes, and all relatively inelastic infomeg, such as wages, with a reaction on the standard of living." An increase in the quantity of money will not necessarilv prevent a fall in the price level, since the whole increase may be absorbed by speculation. Monetary policy cannot govern the price level unless the use of money, as well as the quantity, can be controlled. Tlw maintenance of a stabilised price is a world problem necessitating that the real value of gold, namely, its purchasing power over goods and services, shall remain constant "wherever it is used as tho standard.

"There was an unprecedented drop last year of 17 per cent, in the wholesale price level. We naturally seek to J discover whether a contributory cause i>s the diminution in the supply of monetary gold, and we find that although newly-mined gold to the extent probably of £100,000,000 has become available during that period for monetary and credit purposes, more than twice that amount has been absorbed by two countries, without a correspondiTip addition to the money in active circulation. That gold is as barren as when it lay in the mine."

Mr McKenna strongly advocated international discussion, with an agreement to prevent such an uneconomic decline in the active stock of gold. There should be frank recognition by the monetary authorities of the desirability of a stable world level. Either more gold must be added to the quantity available as the basis of currency credit, or more effective use must be made of the existing stock. Recourse must be had in international agreement. PAYMENT OF DIVIDENDS. DISBURSEMENTS BY AMERICAN COMPANIES. (UICITJS.D PRESS ASSOCIATION—BY EI.ECTRIO TEZ/&GBAPH —COPTHIGBT.) NEW YORK, November 30. Six hundred companies will on Monday pay total dividends of £60,000,000, bringing the cash disbursement for 1930 to a point where they compare much more favourably with last year's than had been expected. Last year's total from 9200 companies was almost £1,000,000,000. What interests Wall Street most is tho fact that the largest dividendpayers are maintaining their disbursements at, or above, last year's figures. MOTUROA BORE. (razsß associatiox tbleorau.) NEW PLYMOUTH, December 1. Moturoa Oilfields report for the week ended November 29th is as follows: No. 1 well waiting for cement to set at 2700 feet, and preparing to free sixinch casing in order to test the "2300 foot producing horizon. SOUTH AFRICAN GOLD MINING. A DIVIDEND OF 1374 PER CENT. A dividend of 137$ per cent'., which compares with the high record rat© of 140 per cent, for 1928-29, was paid by the New Modderfontein Gold Mining Company of South Africa for the year ended June 30th, 1930. In each of the last Ayq years the net profit lof this remarkable company has exceeded j £2,000,000, and in each of the paßt eight years the dividend has not been less than ; 100 per cent. The latest valuation of the I ore reserves their total as £8,757,000 tons, having value of 8.3 dwt.» these figures compared with a year ago showing a decrease of 340,600 tons, and an overago value lower by 0.3 dwt. MOTOR TRADE LOSSES. AUSTRALIAN FIGURES. The slump has hit the motor business of Australia severely. At a meeting of creditors of Barlow Motors Pty., Ltd., which is in voluntary liquidation, the finances of the company were explained by the liquidator. The principal creditor is the Knglish, Scot:tish, and Australian Hank, Limited, to which the company's liability is £136,633 3s Bd, secured by a debenture dated October 2nd, *1929,. ove? the assetß and undertaking. Liabilities to unsecured creditors amount to about £3OO. Assets include new and sec-dnd-hand cars of the book value of £41,450, which have been written down to £24,534.' The estimated deficiency sub.iect to the cost of liquidation is £96,472 lx 6d.