How They Finance in Melbourne.

Feilding Star, Volume XV, Issue 91, 14 October 1893, Page 3

How They Finance in Melbourne.

-— ''• The mysteries of Melbourne banking transactions are indeed 'fearful and wonderful,* judßinß by a little story told by our sprightly contemporary, toe J3uiletin, That journal says: -The Melbourne Board of Works had a happy j experience the other day. Long *go— so long that the date is now lost in the mists of antiquitv-the board sent the poet Fitxgibbon to England to noat a loan of L 1.000.000. Fitzgibbon some^ bow made a bad impression, ana though he sold his debentures they went off at a miserably low price ; in fact, something like LIOO 000 out of the million was lost in discounts and expenses. Tbea the money was lodged in three Melbourne banks, which all reconstructed immediately afterwards so that the Board had practically borrowed a lot of money at 41 per cent merely for the pleasure of lending it out on insecure security at 4$ or thereabouts. This transaction left the miserable board penniless. Last week, however.it managed to float in Melbourne a L30U.000 loan at 5 per cent, realising L9B 6s for each LIOO debenture. And LIOO.OOO of this new loan was taken up bf two of the same reconstructed banks which grabbed the old loan and profess themselves unable, through sheer po?---ertj to let go. Therefore, tbe Board raises money at, say 4£ per cent and the bank seize the money by a forcible borrow ing process at 4|, and then Jends part of it back again at a shade over 3 per cent. This is the sort of thing which makes the hair of the reconstruction depositer turn grey. ___