The Dunstan Times. FRIDAY, OCTOBER 29, 1875.

Dunstan Times, Issue 706, 29 October 1875, Page 2

The Dunstan Times.

FRIDAY, OCTOBER 29, 1875.

Beneath the rule of men entirely just the pen in mightier than the sword.

“ The times were never so dull ” is heard on every side, and go'wherever we will, whether'in the mine, the farm, the shop, tho warehouse, or the counting house, there exists the same cause for complaint As nothing has gone wrong with the productive industry of the Colony, nor do we find, for the -number employed in minim* that tho proportionate yield of gold is anywise seriously reduced, and while the labor of the agriculturist is even better rewarded than when times were said to be good, the subject demands our earnest consideration. To engage the services of bones and sinews, or enlist the skill 0 f the mechanic costs as much per diem as ever, and what is stranger still is,- that every description of labor has actually become Coupled with this wo have to take into account the enormous expenditure of borrowed public money which is daily ..taking place-r-to • believe therefore that “ the times were ■ never so dull ” amounts to an enigma almost beyond comprehension, and we may well askfonrselves what have we done, or what h’s been done to us that things have culminated so disastrously. It is veiy clear that Dame Nature still continues our friend, whi'e the generous, earth fails not to yield its increase, and whether it be tickled with the plough, the pick, or the spade, the same bounteous reward awaits human industry. With all these facts before us it becomes pretty plain that the fault must lie with our s-'lves. and inquiry discloses that we have been prodigal of our good fortune by endeavoring to anticipate events, which only could have occurred to us in the ordinary process of time, in fact, we haye beendiying too fast, borrowing when we should have been saving, and idle when we should have been working. When we have not possessed the wherewithal to satisfy our wants, the difficulty has been met by borrowing money—“ exercise your borrowing powers ” has become the panacea for every evil; this vicious principle has been introduced into every grade of public and private life, and the spurious capital created thereby in'the shape of promises to pay, like chickens, have come homo to roost. Much as we admire the genius of Sir Julius Vogel, his virtues become vices in the hands of the many, arid however admirable his example may be when working alone by him self or for his country’s good, the same practices extended to the community at large, become proportionately pernicious and commerdallyruinous. For the last three or four years the popular cry has been—borrow money—advances were first obtained upon the credit of the Colqny generally, then that of the Pi evinces was pledged, followed in turn by-Harbor Boards, Read Boards, and Municipalities also seeking assistance, until at last, figuratively speaking, everything has been boTOwcd upon that could be, and it reallv becomes a question, if our Colonial Estate, both public and private, has not been hypothecated two or three times over, all classes and succession’s having done their utmost to exercise their borrowing capabilities without any reference whatever to the inevitable consequences of pay day. It therefore follows that the enormous amount of fictitious capital created, or so ranch ofit that has been unprofitably employed or is not reproductive, seeks its original representative in the coin of the realm, or some return in the shape of interest for its presumable value, and tbe consequences are a drain for money upon the industry of the Colony, experienced by everybody in the shape of a commercial crisis, the. difficulty to'make cash payments being followed by a general want of confidence in others to do so. The pressure as a matter of course first applied by the Backs, who scenting danger from afar call in their risky and least profitable advances, and as these, under the pi es' nt circumstances of the Colony are chiefly confined to the trading community, more especially of the second and third degree, the effect is sorely folt by Uie moie luimldp classes, who give or- accept,. credit, or who depend upon making a living from those tint do. The inability of tbe Dunedin merchant to ' afford the usual 'accommodation to his country customer renders it,impossible for him in his turn to accommodate tho-e who deal with him. and ready money or shortened credit is the resrils, which in turn seriously circumscribe the operations of trade by tho demand -for supplies becoming-limited to almost

indispensable requirements, and projected undertakings being held in abeyance. The nextsubject wo have toconsider is, whether it would spot be better to return to n system of more ready money or shorter credits, now that a beginning hag been made, and <so pre-r serve trade in a more healtjiy eOu dition by being less subject to the disturbing influences of cxcessivepaper accommodation *1 It is very clear that'’ the crisis which has overtaken us has not done so withoutsufiicient warning of its approach The withdrawal of the population from tho interior districts to new fields of labor at the public works on the seaboard has been, most disastrous in its effects, especially 80 upon tho goldfields, which have' suffered severely, ■ not because the yield of the precious metal per head is any the less, but because so few people are employed in the getting of it. Trade therefore could not do, otherwise but decline wlrott so many found employment and profit in administering to the wants of tbemining population which has experienced such a sad filling off. The real cause of the present stagnation of trade on the-goldfields must therefore be attributed assisted in the first place by f the scarcity of money—to our industrial hives delighting in an undue proportion of drones in excess of the working bees who produce all the honey. Time alone can rectify tint evil, and which must continue until such time as the Public Works’ Scheme has so far expended itself that the mining population by the reaction which must eventuate, are necessitated to return and resume their old occupations. As was seen from the very first hy persona competent to judge, the loss of peculation on the gold fi elds could never be supylied by immigration as the occupation of gold mining requires a large amount of. special knowledge, and which is only obtained as the result of experience, it becomes therefore of little; use, excepting under peculiar circumstances,

for new arrivals to seek the goldfields. 1 In any capacity, the mining districts scarcely suit the immigrant fresh from home—the manner and style of living is so very different, while the one great objection, the desultory nature of almost all kinds of employments lenders a life on the goldfields anything but inviting to those who have not undergone the necessary training to adapt themselves readily to circumstances. This is not a virtue possessed by the generality of immigrants under the Public Works Scheme—our importations of humanity now-a-days, must have everything ready prepared for their reception, even their bread and butter must be found—the spirit of self reliance, which in the olden dime first earned the bread and afterwards the butter, being almostentirely absent.

We now come to the Banks, who are presumably the chief sinners, and to all the blame is popularly attributed, that “ the times were never so dull.” To a considerable degree the Banks have been the cause of our misfortunes, although not from any malevolent feelings on their part' huh from the system of trade which they . resorted to. Like other people engaged in business, they very naturally desired to make as much profit as possible, and conducted their operations accordingly, and which they had a perfect right to do, equally so with any other traders, without being amenable to public opinion or censure. Of course it was quite natural that business men in Dunedin should, in a monetary sense receive greater aocommo-. dation than those living in the country, inasmuch as they were under the almost immediate supervision of the Bank authorities. Some eight years .ago when , trade became very dull consequent upon the first excitement of the gold fever being over, a system of extensive discounts was adopted, possibly with the viewi to make things better. Now as every Bill of. Exchange, to be negotiable, requires two good names to be aifixed to it, merchants in town naturally drew upon their country customers, for every parcel of goods, discontinuing at the same time the system of open accounts, The result was that,, trade became inflated, merchants "found that the more people owed them the greater was their capital, and they extended their operations accordingly by pushing the country trade—it was three months Bills they wanted, and not money payments for goods. This suited the Banks also, who profited largely by the discounts, while, instead of overdrafts, their advances were doubly guaiauteed. To start or extend a business in Dunedin because therefore a very easy matter, as merchandise could he readily piivchasedupon credit, and a smart financier only possessing premises to hold his stock, was, by means of a country trade practically in possession of both goods and money. Had the Banks only have stopped here, things might have worked smoothly, but they extended the same facilities to their country customers through their branches or agencies. This, as,a matter of course was nothing more than fair, aiul.no harm would have arisen had the Bank's restricted their accommodation to responsible persons as implied by a Bill of Exchange, but instead of this, they made almost unlimited advances to traders in Dunedin Upon the faith of the soundness of their country customers. Thingshavingnow worked themselves round again, the demand for specie to meet engagements is begin-

rung to tell upon the inflated trade; of Dunedin, and to provide against possible losses, the .Banks ■ have : decided that at least acceptors to country Bills of Exchange shall bo sound, even it the town drawers are not, and this can bo best effected by an almost universal .withdrawal of Banking aocommoflatiyn outside of the chief City of Otago, Of course it is illegitimate that Bills of Exchange representing only one parcel of goods should bo twice negotiated, as would be the cose by their first sale in town, being followed by a re-sale in the country, and both sellers respectively drawing upon their customers and discounting the Bills through the Bank leaving out of the question altogether the possible obligations of somo previous holder.

The system adopted by town traders of drawing Bills of Exchange for every parcel of goods sold, is a "most pernicious one, and opposed to the principles of sound commerce—the practice might be very well in the settlement of, an overdue account, or when some special accommodation is necesfft y, arid then, its exact nature should be umlei-stoodbytheßank.. Under ordinary circumstances any • merchant should be able to keep an open account with his customers, as in either case the one u not in a position to give credit, or the other to accept of it. This would place a limit upon over trading, as each one would understand exactly the length of his tether, there would be less inducement for people to li/o beyond their means,less cases for the Bankruptcy Court to adjudicate upon, and which almost invariably reveals the unpleasant fact that the person who gives credit.is equally blameable as the person who receives it, both having been working upon the high pressure, system engendered by the very objectionable practice of indiscriminate- resort to paper money, rendering it necessary for traders to force sales instead of contenting themselves with the usual course of supply and demand. _ The decline in tho price of wool, with a probable further uecline to follow, commercial failures in England, America and Australia, as well as the approaching com. pletion of Public Works in hand, are doubtless the chief causes of the pressure put upon the mercantile community by the Banks—happily there need be ho apprehensions of a falling off in the yield of the goldfields, while it cannot but otherwise occur that as tilings become dull towards the seaboard, the mining districts will bo correspondingly bene fitted, while tho effects of the commercial depression by hnugiiig about a more healthy system I of trade must in the end prove of con- ; siderable advantage. The productive j capabilities of -the Colony are as great jas ever, and by the railway system i they will be increased. With a healthy i system of commerce introduced, there j is amply sufficient vitality in the Coi loiiy to tide it over any difficulties by | which it may be assailed; New Zea- | land'emerged fro m its state of chrvsj alis rather too hurriedly, and the General Government as shown by late advices have come to see this, and wisely refuse to' undertake the eon strnction of any more railway lines than those already in hand, or guaranteed, are completed. It will be wise therefore during the next few years for every colonist to take seriously into consideration tho teachings of that old fashioned, hue pardonable precept, “ patience to work and patience to wait.”