DOMINIONS CREDIT

Evening Post, Volume CXXVI, Issue 80, 1 October 1938, Page 21

DOMINIONS CREDIT

NO NEED FOR ALARM

VIEWS OF MR. H. E. COMBS

During the course of his address at Newlands last evening, Mr. H. E. Combs, Labour candidate for Wellington Suburbs, made reference to the reduction of the London funds and the use that had been made of that to indicate that investors were losing, or. had lost, faith in New Zealand's ability to meet its overseas obligations, especially the £19,000,000 of loans falling due in 1940.

Apart from the fact that the speculator, as distinct from the investor, had a special interest in seeing that the price of New Zealand loans fluctuated as he (the speculator) gambled on such fluctuations, said Mr. Combs, there was also the factor that business people were dabbling in foreign exchange and shifting all their spare cash from New Zealand to London and elsewhere. The probability was that they would have to transfer most of it back again, but in the meantime their activities did not affect the balances held overseas against New.Zealand's interest bill and other, commitments.

It did not seem to Mr. Combs that the average New Zealander should be in the least alarmed oyer those fluctuations. If the speculator in New Zealand and foreign exchanges made money in that lottery he would, in due course, pay. income tax on his success, and if he lost money the average New Zealander would not be disturbed in his daily work nor would it affect the contents of his pay envelope. CONTROL OF CREDIT. New Zealand's currency and credit were controlled by the people's representatives through the Minister of Finance using the Reserve Bank for the purpose. The meeting of New land's overseas commitments was just as certain under the Labour Government's direction and control as it had ever been. . Since 1935 every penny due for interest in London had been paid and so far from finding it necessary to renew some of the loans which j fell due in the last three years they j had been able to pay them off under j Mr. Nash's wise direction of finances.

The meeting, which was presided over by Mr. Offord, received the candidate enthusiastically and accorded him a vote of thanks and confidence on the motion of Mr. Earl, seconded by Mr.bD. Barlow.