STATE NOTE ISSUE.

Dominion, Volume 2, Issue 461, 20 March 1909, Page 10

STATE NOTE ISSUE.

; Sir, —I have to thank you for publishing my letter on State ; Issue, which H./'Bodle-y calls twaddle. I will now, ask'your indul-> gence to answer his. l questions,' and let .your Readers judge,, who has'written the. twaddle. With, regard . .to : Franc?, tho land .of . the lassigjnats: The' gold' reserve of - that country was created because the State. issue was mado convertible . instead- of inconvertible, and the rosbr're is also held in case/ of war. It shows the psefulnes3 of Stato' guaranteed paper morfey, when it enables \a country to mop .up the largest j store of/gold in the world in so short a time,- and besides ' doing this it _ is only a .littlo 'more than • thirty years since France paid Germany an indomnity__ of alfout 200 _ million pounds in gold. Without'/the assistance ,'of paper Franco could, not have - accom-' plisheel what she has .'done. . -And 'if the United States had had a guaranteed paper currency it could have, been independent' of French ;or English gold- during, the recent financial:, crisis there.. Will Mr.; Bbdley deny that our-own Government's guaranteoiof paper issuo did not esercise as much power, for New Zealand in .1804 as French gild' did for America ■ about a year ago, and if our Government did sit much for a private institution (viz., , tho Bank of New Zealand), why should it not do as much-for New Zealanders as a ■ whole, instead of fayouring one' institution only? ■ ■ ' ... ._ As showing that'we are practically .ing on paper money'.(now .privately-owned paper instead of . Government paper),! I may mention the fact as-reported through the papers, that when only £80,000"in gold: Was', i recently wanted--.to. pay. tho American fleet in Auckland, the bank■had to ; send abroad aitd import it,. and that. £80,000,'wasi only wanted for a short time, as it would ■ probably be returned to the banks within" a week or two of being paid/out. How comes it that with about £21,000,000 deposited in our country's banks, and 'I, presume Auckland has its share of those deposits, that they bad to send out of-the country to make up a paltry £80,000? During the last 51) years tho Australasia'n colonies) havo' sont away between 200..and 800 million 'pounds worth of . produce and 1 wealth to pay our interest bill. No wonder .wo havo no'gold Tescrvo worth speaking of, and havo to send i round the colonics to Collect £80,000, when that amount of gold is required in ono sum, while tho country, working 011 its own paper ourroncy, prospers and rises in the short space of SO odd years to - one with the largest gold reserve in tho world, and a lender to other countries. —I am, etc., SENRY JAMES TURNER. .Wanganui, March' 13, 1909. '