The Evening Star THURSDAY, NOVEMBER 4, 1875.

Evening Star, Issue 3961, 4 November 1875, Page 2

The Evening Star THURSDAY, NOVEMBER 4, 1875.

The 'Daily Times' had yesterday a dive into the mystery of commercial crises, but returned to the surface with no new light on the subject. The mere commonplace remark, so often oracularly made by commercial men, that crises occur periodically in Great Britain, ad if that were a quite lucid explanation, was put forward as a sufficient reason. Then there was a drag in of the doctrine of averages, by which it is predicted that the " crisis " in New Zealand is to reach us next year, which may accidentally be verified, but which we suppose as likely to be true as Dr Cumming's prophecy of the coming of the end of the world. The efforts of our contemporary to understand the matter were too exhaustive, and in despair he concluded : "The causes of a panic" (which he evidently considers the same thing with a crisis) "are still among the undiscovered social problems, and the sagest of the economists have not been able to tabulate the phenomena, and place them in such a light as that we can reckon up cause and effect." It may be safely affirmed that no one will ever be able to tabulate formula) regarding changes depending upon causes as various as those which influence the weather; but there are broad principles in commerce on which alone it can be safely conducted, and certain disturbing agencies the effect of which is well known, so that with sufficient intelligence, and power of accurate observation a fair diagnosis is possible. It was the ability to comprehend the relative position of the United States to Europe, since the civil war, that enabled the late talented Professor Oairnes to predict the commercial disturbances of last and the present year. It was the power to apply commercial principles to the development of New Zealand, and faith in the soundness of those principles, that led Sir Julius Vogel to adopt that splendid scheme of immigration and public works to which the country owes so much. It is either the inability to understand those principles, or a wilful desire to create uneasiness and apprehension, that has led the writers connected with the ' Daily Times,' from Master Humphrey downwards, to be continually palavering about coming crises. It would not be difficult to prove that the banking system of England, which gives a monopoly to one giant establishment, is a fertile .source of frequent commercial embarrassment. This would be of less moment were its effects dependent upon constantly recurring causes, but this is not the "case. The rumor of a war, a war itself, a heavy foreign loan, a change in the currency of a country, or even a large financing operation, is quite sufficient to raise the bank rate of interest to panic pressure. The diversion of capital for » short period from one branch of imports to another used to have a like effect, and so also has the conversion of circulating capital into fixed in the construction of large public works such as railways, whether m Great Britain itself or America, or the Continent of Europe. Ho far as Kew Zealand is concerned, if coimnerei,:! a aid manufacturing industry remain ;-!,ea ,dy at Home, and tiic price of raw nmieaaal does not vary much, no very scrioita apprehensions need be entertained. There will be the ordinary compete ion, perhaps an increasing one, with, ot lies- countries in fhe sale of wool -.n .1 of whoar but th" f.fr\,.f of (i..,, .. v -il be counteracted by U,e opi ■uing of extended markets for j zianufac, tured goods,

and by improved nodes of depasturing ' and agriculture, ending to increased production at nc increased cost. No very serious diturbance need be apprehended fron the extensive building operations r«ndered necessary by immigration, as property is thereby so much enhaned in value as to justify foreign cajitalists in advancing money for investment. We should like to see a larger amount of exports as a set-off igainst our imports; but the differente is not so great as it seems, for included in the eight million of imports is about half a million for railway plmt; and as a set-off there are the stoik on hand and the profit on onr transactions. The chief cause of perplexity to our contemporary is the consequences to the country when the railway loan is all spent. What will then become of New Zealand 1 '•' Dull times will then come " so says the 'Daily Times.' We do not say they vill not, because we have already shovn they may, but certainly not because the loan is spent, if the purpose for which it is obtained is fulfilled. The obect of the loan is to provide means for sustaining a large population in wedth and comfort, and unless this is accomplished, the whole end and purpose of the construction of railways are defeited. The money was not borrowed merely for the sake of spending it, but in order that production and transit nay be reduced to the lowest possible ost, so that New Zealand may be able to compete successfully and profitably in the world's markets. Experience, too, has shown that the interest on tae loan will not press heavily on the country, but that in a very short time the traffic receipts will most likely be go large as to add to, rather than abstract from, the revenue. If the ' Daily Times' were perplexed at what may happen when immigration ceases, we should have thought it less surprising. The working classes will then be astonished at the fall in wages.