The Feilding Star. THURSDAY. MARCH 26, 1885. Banking and Currency

Feilding Star, Volume VI, Issue 120, 26 March 1885, Page 2

The Feilding Star. THURSDAY. MARCH 26, 1885. Banking and Currency

There is a very excellent and well meaning gentleman in Dunedin named Bathgatk, who, unfortunately for his present peace of mind, has had some slight experience in Colonial Banking as practised in Otago. At one time he was pleased to imagine that his knowledge on the law and practice of banking was complete and faultless, but as years have come upon him he has gradually discovered that he has yet something to learn on Hie subject. The outcome of this discovery has been that owing to persistence and the " friendly faith of a few fellow members" of the Dunedin Chamber of Commerce, that body has been induced to pass the following resolution, which was brought up by a special committee appointed to report as to the expediency of establishing a State Bank of Issue for the Colony : —

"That the Chamber memorialise the Government in order that a Parliamentary Committee may be appointed to investigate the whole subject of the currency and the practice of banking within the Colony."

This resolution is therefore now to be brought specially by memorial under the notice of the Government, who are coolly requested to obtain the appointment of a committee to collect information for the especial delectation of a few elderly gentlemen who have a peculiar crotchet which they would like to see infecting the rising generation as well as themselves. The creation of a State Bank of Issue is a fad which all statesmen and financiers of the present day — with very few exceptions — have united in condemning. Sir Julius Vooel said the other day that men like Mr Bathqate appeared to think that all which was required to create capital was a bale of paper and a printing press. A Bank of Issue established by the State, which has virtually no capital, for the revenue in its hands is, in fact, trust money, which may not be diverted from its legal uses, would bring paper money into conflict with the hard cash of bona fide capitalists, and the ulti- | mate extinction of the least valuable circulating medium. If it were necessary for the general welfare of the Colony, or if any of the banks doing | business in the Colony were guilty of wild and reckless speculation, or of making risky and unprofitable advances to the danger of the funds of shareholders and depositors, then we would be inclined to ask the Government to exercise their powers in this connection and protect the people from avoidable loss. But every one knows who has had any opportunity of watching the system followed by the banks in the Colony, that their business is conducted on the best principles, as laid down by the ablest authorities at Home, guided by the special experience of able financiers in the Colony. When any reform in the law of banking has been required hitherto, its necessity has invariably been suggested by bank directors to the proper authorities, who have as invariably been able to accept them as measures of practical utility. We hope and expect that the memorial of the Dunedin Chamber of Commerce, when presented, "will be laid upon the table of the House, and allowed to remain there until time yellows the paper on which it is written, and makes the subject venerable by age.