THE FINANCIAL OUTLOOK.

Franklin Times, Volume 9, Issue 639, 7 June 1921, Page 6

THE FINANCIAL OUTLOOK.

An optimistic opinion regarding the financial prospects outlie Dominion is expressed by “Cambist," a recognised authority on financial matters. He writes as follows: —“Two important announcements were cabled from. Home during last week. The first was that in the budget proposals it was determined to fund all of the floating debt of Britain. To do this over £648,000,000 of interest bearing Treasury bills and .short-dated loans, costing the taxpayers on the average 7 per cent, interest, were to be converted into £100,000,000 of 3V per cents. This transaction means that at last the war has been paid for, and that no longer will the industry of the Empire be hampered by the war muddles and the expenses connected therewith. What a wonderful Empire we belong to! In matters of finance we still lead the world. America, with a better banking system for Local purposes, has not yet proved that she is up to us in high finance. In fact, that boastful country still lags behind us when it comes to foreign questions. Now that the “decks are cleared for action,f Britain will.shortly prove her worth as a world power in matters oi commerce and finance. Following the above come.-; the news that the oank rate has L<.vn reduced to *>'•: per tent. This is indeed a warm ray of sunshine to brighten our hopes. I;

t!ie crop of emancipated money was not ripening under the eyes of the bankers of Britain, no such reduction could have been possible. The floating debt could not have been funded unless more money was in supply. The bank rate coukl not have been reduced if the same fact were not in evidence. Scon, we may expect to see the bank rate reduced again. Then the greatest trade expansion ever known to the Empire will follow. The period of dear money is fast passing. If the price of loanable credit remains anywhere at the rate lately ruling it will be because the demands of industrial expansion will be so great that every penny of saved money will be put to use. That is a natural sequence to the period of waste and destruction lately finished with. As to New Zealand, we have only a matter of twenty millions to square up, and when that is accomplished, the country should soon forge ahead again. The huge additions to the British Empire must be brought into profitable use, so it will not be long before we can play off against America the raw materials needed for manufacturing purposes, and these will take the place ui exchange transactions that American gold is doing now. A final world gold reserves of the Bank of England aio now about £126,000,•000, as against' £82.000,000 before the war. Every one of the matters referred to here are bright signs of a quick return to real prosperity. There is no need to be pessimistic but there is gieat need to turn our thoughts and ac.tionss into the profitable groove where money is to be made by honest toll and continuous operations.’'