THE MONEY MARKET.

Dominion, Volume 6, Issue 1659, 28 January 1913, Page 8

THE MONEY MARKET.

VIEWS OF MR. A. M. MYERS. "NECESSITY OF CURTAILING OUR LUXURIES." ' (By TelfffraT>h.—Special Correspondent.) ■ Auckland,' January 27. Tho present condition of tho money market, finely the difficulty with whicn local bodies are confronted in securing money for necessary work' is causing a great deal of discussion in business circles at tho present time. Interest 111 matters financial was. keen yesterday, owing to the flotation of tho Auckland Harbour Board's .£250,000 loan' at 5 per cent, on the Homo market, and a great deal of: controversy took-place regarding tile prospects. of other local bodies in securing loans. ' .The subject was referred by a,"Herald", representative to Mr. A. SI. Myerp,' M.P., Minister for Finance in the late Mackenzie Administration.

.' Mr. Myers said that the great industrial activity in all parts' of the civilised world at the present time was creating a demand for money, and the money market,as the markets for other commodities, was regulated by supply and demand. The tendency, had been for some time past for the rates to harden/

What is your opinion of the position local bodies now find themselves in? Mr. Myers was asked.

"Everything seems to point to the fact that local bodies will have to pay a higher rate than they have done in tho past," said Mr. Myers.' , ."Secondly, they should take heed of tlie previiling position, and only carry out essential and necessary works. , "I am afraid,".he continued, "that, notwithstanding the high prices prevail-' •ing for all our. staple products, fhe latest figures regarding our, importations clearly demonstrate the fact that we have. not yet realised the necessity of curtailing our' luxuries. 'In the light"of the tightness of the money market, and the hardening of the rates which money can be borrowed outside the curtailment of our luxuries should be our.policy until there-'is some alteration in the market.'

"Colonial securities," Mr. Myers went on-to stiy, "are still popular with the investing public in ' the Old Country, but the universal demand- for money 'makes the tenderers naturally raise their'rates of interest. The settling of the' Balkan ciuestion would have the effect of improving; that. If we pursue a policy of prudence, I do not doubt for a: moment but that satisfactory arrangements can be made for the borrowing ■ of N sufficient money ■ for immediate requirements." When questioned regarding the raising of money locally, Mr/Myers said that in his opinion, as so miich money was required for our development, it wiis desirable tovobtain as much of the money as possible ,to be raised in loans from outsido 'New' Zealand.,