AN INTERESTING EXPOSURE.

Dominion, Volume 4, Issue 1020, 9 January 1911, Page 4

AN INTERESTING EXPOSURE.

We had hoped that' it would not bo necessary to make any further reference for the present to the failure of the five million loan, but a remarkable article in the Govern-

merit's Christchurch organ, which alone attempts to defend the transaction, calls for some final observations. Our readers will remember that we quoted the opinions of a great number of the principal British newspapers, and that of these tho Standard, was alone in abstaining from regarding ths loan as a failure. Our Christchurch contemporary, having unwisely embarked upon the impossible task of denying a notorious and universally admitted fact, was bold' enough to suggest that we had only quoted {he unfavourable notices of the loan, although tho wide and representative list of the journals quoted made it obvious to every journalist that we had given the substance of every opinioh that was available. The Christchurch paper had nothing of its own to guofcc until Thursday last, when, in an article teeming with mis-statements, it quoted tie British It said: "The British Financier, referring to the incident, said it was quite unable to understand 'how the Prime Min-

iSTER'had allowed such a communication [Me. Hall-Jones's cable] to be. made public, but straightway proceeded to commend Sir Joseph for 'going boldly to the London money market' and for the 'singularly open and straightforward character' of his appeal," We are •indebted to the Olago Daily Times for a complete exposure of the unscrupulous way in which the Christchurch journal has used the article in the Financier. The following is the from the Financier which is coolly referred to as evidence'that the loan was not a failure : ,

For our part, having none but the best wishes for A'cw Zealand, and especially for tite success of this loan, wo shall not 1)0 misunderstood if wo speak our mind freely on what we believe to be the cause of this contretemps. ; There was no secrecy whatsoever about tho issue of the loan. It was authorised months ago by tho Dominion Parliament, and although tho policy of borrowing so heavily for public works of doubtful utility was severely criticised, the Ward Ministry was' universally commended for going boldly on tho London money market instead of adhering to the -vicious system established under the Seddon .regime of small local loans at heavy discounts,, with veiled commissions and all sorts of wrongdoings. Then the prospectus itself;-when it appeared in tho principal London papers last week, must have struck everyone who can read between the lines of such documents as a singularly open and straightforward announcement. Tho terms offered, indeed, were decidcdly attractive, more so than they ought to havo been by compari,-. son with Canadian and Australian bonds. Lint there was the safeguard of a high price of - issue, .£9B 10s., supported by a' prudent.plan.,of optional conversion into inscribed stock. Why could not the loan have been allowed to go forward to tho public on its merits as a high-class investment? That capitalists were ready to give it a friendly reception is shown by the frill in Consols and other gilt-edged securities which followed the publication of the prospectus. That meant that selling was taking place with a view to subscribing to the new loan. Why, then, was there any resort to underwriting at all? It should;; also bo added that, .this was written, •as tho Christchurck paper knew,, before-, the result of the loan issue was Known. Tho incident is thoroughly characteristic, of the methods that the friends of the Government delight in using—methods which fortunately the public knows so well that it is long since anv reliance was placed. by thoughtful people in the Ministerialist newspapers' defence of the Government's financial activities. In the same article, by the way, our reckless contemporary declared that' there is "abundant evidence on every sido" that "the credit of the country has never stood higher than it does at the present time." What is this abundant evidence? Is it, perhaps, the fact that the London investing public avoided tho new issiio, taking only 7 per cent of it 1 Or is it the fact that, as a cable message shows us to-day, New Zealand 3l per cents are lower than the 3i per cents, of any of the Australian States? The figures are:

New South Wales 98J Victoria 97 South .Australia 9GJ v Queensland 9Cj West Australia 97 Tasmania 97} New Zealand 95J If our credit is higher just now than over before, how comes it that our 3l per cents arc lower than in any year sincc 1893,1 The controversy over the loan has'had the effect of showing how utterly untrustworthy —since they are utterly reckless and unscrupulous —are the statements made by the Government and its friends upon the national finances. ■■j a