Page 7 Advertisements Column 1

Evening Star, Issue 22147, 30 September 1935, Page 7

Banking Lubricatesit does not Govern. The function of banking In the economic machine is to act as Lubricant, not as Governor. The Banking system has an intake and an outlet. The Intake absorbs the money of the community not immediately required for use by its owners, offering , complete security and interest rates fixed by the law of supply and demand. The outlet carries the flow of money to those points where it Is needed, facilitating the operation of the machinery of production. The farmer, the manufacturer and the importer who desire to produce goods for the future market, either by growing them, manufacturing them, or by purchasing them overseas, would be greatly inconvenienced if they were unable to borrow for their temporary needs. Each would have to be equipped with much more capital than is now the case, and for a considerable portion of the year much of that extra capital would, lie idle. By accepting funds from persons who do not immediately require them and distributing those funds among persons who do require them, the banking system facilitates production and business. —lnserted by the Associated Banks of New Zealand,