TOPICS OF THE DAY

Evening Post, Volume CVIII, Issue 135, 4 December 1929, Page 10

TOPICS OF THE DAY

Life is a great adventure. It always was, but nowadays more so. There were always people who went to horse races to see fast animals fall —which sooner or later they do—but now it is possible to see still more spectacular falls with machines on dirt tracks. Risk-taking has been so syslematised that the incidence of fatality seems to be comparatively low—"there are not nearly so many people killed as there ought to be," observes an innocent lady spectator —and by a parallel process of development it seems likely that by and by there will be stadiums erected for the observation of aeroplane-crashes, so manipulated as to further outwit the death-angel and the undertakers. With motor-cars travelling on earth at 231 miles an hour (a record to be shortly broken by quadrupling Segrave's horse-power) and with aeroplanes going so fast in the Schneider^ Cup race that their speed "beat their own sounds," the spectacular value of mere speed seems to be almost exhausted, since one can partly enjoy what he can scarcely see. But the "stunting" field otherwise is as yet almost unexplored, and the machine age in gladiatorial pursuits still has its future before it. And with it, of course, arise new possibilities for the insurance man. Only to-day comes a cablegram indicating that a Sheffield (British, not American) motorist has carried the war into the enemy's camp by securing £30 damages against a pedestrian who was "walking to the public danger." Result—"a leading London insurance firm has introduced a new policy to cover pedestrian third party risks." Computation of the premiums needed to protect jay walkers must be far more complicated than the old-time actuarial assessments of the risks attaching to a dancing girl's million-dollar legs. Those leg insurances, seem to have died a natural death, but the street risk cover should be popular and permanent, since modern city traffic—white lines notwithstanding—is apt to recognise no one save "the quick and the dead." Proving, as already mentioned, that life is, more than ever, a great adventure.

Mr. Wynn Kirkby, as chairman of the Wellington Stock Exchange, has officially issued a warning to the public against "wild cat" schemes. This is timely, and it should have a good effect upon so-called small investors. He expressed the opinion that members of the Stock Exchange "should do their best to educate the public in the principles of sound share investments." Presumably Mr. Kirkby had the small investor in mind, that capitalist with £50 to £100, or even £300 to £500, to put to more profitable employment than Savings Bank or fixed deposits which the banks provide. Persons with larger amounts to dispose of no doubt keep in close touch with their sharebrokers and do receive advice and guidance of the kind Mr. Kirkby had in mind. But there is all the difference between investment and speculation, and yet the two are regarded as synonymous by many people with a little money to invest and less experience of investment. Men and women with a little money are naturally anxious to make the most of it, and it is very difficult to convince them that the greater the return on capital the greater the risk is the rule, whereas safety in investment (if any investment is more than relatively safe) and moderate returns usually run together. The saf-

cst investments in New Zealand for ihe small capitalist arc the Savings Banks, and the money with them is at call. But if that way to affluence or even a competency is sure it is very slow, therefore the small investor seeks other and often more hazardous paths by which he may indeed never arrive. Further, he has not the financial stamina of those who can afford to lose in taking "sporting chances," for these speculators may very well average out at the end of the year at a profit. The Stock Exchange would have share-hawking made illegal, but if it succeeds in this, or in obtaining any further legislation designed to protect investors, large or small, it cannot hope to turn reckless speculators from their ways nor to successfully bridle the speech of glib salesmen. All the law can do and all that the Stock Exchange can expect it to do is to make the lot of the rogue as difficult as possible; but for the small investor venturing into the sharemarket the only principle to be applied is "safety first," and that usually means a moderate return in interest on capital.

Bi-cameral clashes in Britain and in Australia have lately been in prospect. In each country there is in power a Labour Government, and it is natural for a Labour Government to take up the task once identified with Liberal Governments—the task of fighting the Upper House. Generally speaking, Upper Houses have not been nearly so uppish in their attitude to Governments as was the case before the War, but the reason probably is that the old enemy of Peers, Liberalism, has become so close in colour to the bleached Conservatism of the postwar period that Liberalism has ceased to be a red rag to the Upper House bull. Only a few years separated the moment when Mr. Lloyd George performed the service of toreador to the House of Lords, from the moment when he led that docile animal round the political arena with a nice little ring through its nose. But if the old red rag has gone, a much redder rag is beginning to take its place. A sign of the coming conflict is the treatment of the Mac Donald Labour Government's Pensions Bill by the Lords, who have introduced the factor of necessity into ther claims of widows. Echoes come back of the old quarrel as to what is a charity and what is a right. Labour will no doubt stand in Britain just where Labour stood in Australia when the Australian "baby bonus was at issue. Every baby must be the same baby, and every widow the same widow.

In any conflict with the other Chamber—as indicated in to-day's London cablegrams, and as suggested in Mr. M. J. Reardon's Australian comment in Monday's issue— it has to be remembered that in the Lower House Labour has a majority in Australia, but not in Britain. Mr. Mac Donald's policy may, therefore, prove to be not parallel with Mr. Scullin's. Or, to approach it from the other end, the House of Lords may prove to be much more militant than the Senate. It is difficult to believe that the Nationalist majority in the Senate is looking for another election; but the House of Lords, not answerable to electors, has nothing to fear except the Parliament Act's limited power under which the Commons may pass a Bill over its head—a power dependent on the casting vote of the Peers' old friend and enemy Mr. Lloyd George. Mr. Reardon, referring to Australian Labour's dropping of military training, notes that a Labour member of the House of Representatives cried out to a Nationalist: "Can you get your crowd in the Senate to box on on this issue?" Probably the Nationalist majority in the Senate has good reasons for not boxing to a I decision on the question; but, remarks Mr. Reardon:

If it does bring the two Houses into conflict, it appeared clear to me that W. M. Hughes will jump into the leadership of the Opposition at one bound. Littlo and insignificant though he is in appearance—the least soldier-like figure iv the whole Federal Parliament—he has a wonderful influence among the returned soldiers.

This opinion may be bracketed with the cablegram published yesterday on the founding at North Sydney, round the Hughes group, of a new party. Our Australian representative considers that the non-Labour pact is in the crucible. Everywhere, except in the Senate, the cards seem to be for the moment in Labour's hands.

Capital hitherto absorbed by speculation is returning to normal channels, states President Hoover. To stop United States speculation has not been an easy task. Whatever control banking systems may have over finance, there is no system yet that can by pressing a button prevent the growth of speculation, nor is there a system that can with equal suddenness stop the tide of speculation at its flood. To do the latter might not be desirable, if possible; indeed, the great problem is how, if the rise of the speculative tide cannot be prevented, its fall can be flattened out and made gradual. Some idea of the course of events in the United States, and of London's influence on it, was conveyed yesterday on our Trade and Finance page, in which it was pointed out that at one stage the Federal Reserve Board of the United States tried to restrict loans by banks to stockbrokers, but "depositors withdrew their money from the banks and lent it to brokers at high rates of interest." Thus the power of the banks is not unlimited. The lending public may decide to finance the gambling public direct. In that case the dance must be danced to its own conclusion, possibly by exhaustion. Then banks and Governments must devote their energy to harnessing the reaction. "Through die measures we already have taken," says President Hoover, "we have re-established confidence." Wages, he adds, should not fall. He is the sort of business President that America may listen to.