UPWARD TREND

Evening Post, Volume CXIII, Issue 7, 9 January 1932, Page 14

UPWARD TREND

AUSTRALIAN CONDITIONS

A BANK'S COMMENT

Commenting upon the indications of an upward movement in conditions in Australia, the monthly summary of the National Bank of Australasia states that many drastic adjustments affecting the costs of Government and of production still have to be effected before a stable and prosperous condition of affairs can be looked for. "One thing is certain, and it is that the way to prosperity will not be made shorter and easier by adopting, plans for 'extending credit or increasing the note circulation for the purpose of reviving the buying demand of the masses and stimulating industry," adds the, statement. "If by the use of <such methods the effect desired could be obtained and no aftermath of deeper depression and wider unemployment result, little opposition would be roused among business men, whether bankers, traders, or producers. They, however, are guided, not by wishes, but by the facts of the day and the lessons of recent and distant history. "Too much importance is accorded to the monetary factor in the economy of the country by those who would experiment with its currency and its credit institutions. France and the United States of America have more than ample money, but they also are suffering from the depression and are unable to keep their people employed. "Those who so actively advance some or ojther, form of inflation—whether 'release\of credit/ expansion of note issue, control of banking and finance, or 'social credit' schemes—well might be asked: 'How much money would suffice?' "In the Summary of Australian Statistics^ for the September quarter the following' accounts arc shown under the headings indicated:— Commonwealth, notes 52,053,426 Deposits • of---! : cheque-paying banks . 299,736,000 Deposits of savings banks ... 192,547,000 Total 544,336,426 "If this structure of currency and credit does not provide adequately for the monetary requirements of a population of six and a hah: millions, what amount would? It will be noted that these figures take no account of the large amount of coined money in circulation. % _ v "_What is needed is not more money; it is a sound adjustment of the nonmonetary factors, such as will be made by the free interaction of the various forms of. individual and 'community effort, and be kept ml balance through the pressure bf supply and demand upon prices."