The Feilding Star. TUESDAY, MAECH 24, 1885. Cheap Money

Feilding Star, Volume VI, Issue 119, 24 March 1885, Page 2

The Feilding Star. TUESDAY, MAECH 24, 1885. Cheap Money

♦ Sib Juxjus Yogel, in his speech to his constituents at Christchurch, proposed as a means to assist persons desirous of obtaining money to cultivate and carry out land improvements, a system of advances by quasi boards. He was careful to say that he was not speaking on behalf of the Government. — It appeared to him that it would be possible for the Government to guarantee a certain amount of debentures, the proceeds of which should be devoted to lending money for actual improvements on land, and on land which had been actually improved, the money to be lent in small sums and under conditions which would enable a true estimate of the value of the laad to be ascertained. He believed that the Government by that indirect means, without any risk whatever, might enable companies to borrow this money cheaply, on the conditions that they should lend it out at low rates of interest, say 5f per cent., certainly not more than 6 per cent., to persons who had small farms, and not only to those persons, but to persons who had purchased hud on deferred payment, or those who had taken up special settlements, or who were special settlers. If this could be done, and he had no doubt that it could, it was impossible to overestimate the advantages which would result from it. They knew wheat was at very low prices, and they might say that legislation was absolutely impossible to have for its effect the raising of the prices of wheat, That was so, but legislation in the direction he had indicated would, he felt sure, have the effect of increasing the prices of wheat, and would also have the effect of increasing the profits of those who grew it. He could not help thinking that it would be right for the Ooverhment to take some stops to enable the large agricultural population of this country to obtain money at less usurious rates than they had been able to do, and he thought it was in their power to do that. Theße loans must be of ■mall amount, and therefore they would not interfere very materially with the large Companies. Although the scheme has the advantage of looking very feasible on paper yet we fear it is utterly impracticable. The system which obtained for many years under the Wool and Oil Securities Act, and, since 1880, under The Chattels Securities Act of that year, of advances made by the various Banks and Loan and Mercantile Agency Companies to farmers and graziers secured by liens on crops, live stock, wool, oil, Ac, has been found to work admirably, and to the profitable advantage of both parties. The expenses for commission are reduced to * minimum of nominal charges, and the rates of interest equal to market rates* What Sir Julius shadows out is that a finfti"«*l scheme may be evolved whereby money can be lent at less than its market value, such money to be created by the issue of guaranteed Government debentures. He says that " These loans would not interfere very materially with the large Companies." We know to the contrary, and the opposition his proposal would meet from them would be insurmountable. In conclusion we may state in the words of our contemporary the Canterbury Press: "It is not because there is not plenty of money for investment in the Colony that farmers suffer, but because the needy ameng them have no satisfactory security to offer."