The Guardian AND EVENING STAR, With which is incorporated “The West Coast Times.” SATURDAY, APRIL 2nd, 1921. THE WEEK.

Hokitika Guardian, 2 April 1921, Page 2

The Guardian AND EVENING STAR, With which is incorporated “The West Coast Times.” SATURDAY, APRIL 2nd, 1921. THE WEEK.

Tiik trading position cl the world at, large is disorganised at the present. As a Sydney paper puts it stagnant trade is not a condition peculiar to Australia. It is general all over the world In Australia, in fact, we are just on the fiipgo ol it. The trade returns ot imports and exports belie themselves. They in fact express as far as imports are concerned not the expansion as it really is but an expansion which was hoped for by our own importers, as well as by consignors in Great Britain and the United States. The goods which are coming here are finding .n almost dead market. Bank clearings for New South Wales since the commencement of the year, only last week, showed a decline compared with tb corresponding week of the previous year. They are the indication of the state of truth*. In Victoria the bank clearings have been consistently less week bv week than those of the preceding year. The decline represents about £300,006 a week. Reckoning a similar decline in inter-bank transaction, it would represent a decline in spending of about 8/- per bead per week of ,tbp population of Victoria. That New South Whiles has not suffered a similar decline is due principally to the free, spending of loan money. When the spending stops the position will he the harder for us, because we shall have not only our own people to consider but also those who have been attracted from other States because of the more favourable conditions of living offered litem here.

Stagnant trade has caused a fall in prices. That fall lias been compulsory because of our method of conducting business on credit. Credit lias its disadvantages as well as its advantages. It enables expansion of trade, a building up of industry far beyond what would he possible were cash transactions the rule on every occasion. When the confidence engendered by credit and the optimism of traders brings about over-trading then the slump is the greater than if each man owned absolutely the goods he traded with, instead of a large portion of them representing money lent so as to enable him to carry on a greater business than if ais own capital alone were used. Money has to he found to repay loans, goods have to be gut rid of. So buying must be encouraged and only by reducing prices can buying be encouraged. Thus it is that we see the cut in prices which is in progress in many lines of merchandise. The cut in prices represents the merchants wav of meeting the situation. The commercial community is reducing its standard of trading, not standard in a moral sense, hut in a material sense. Trade is being contracted, stocks are being reduced. Conservation, not expansion, is just now the watchword. The condition of affairs is revealed by applications which are received for an extension of the due date of hills both holme and foreign. In such circumstances the members of the commercial community act independently of each other. They do not agree upon a course of action, but, each determines what his course will be and how be will meet the situation which has arisen.

Labour, too, must moot the situation whether individually or collectively it is for itself to determine. War-time prices are coming down. War-time extravagance must vanish; war-time wages will pass away. That this is so is being recognised among Labour leaders in Great Boitain. Two citations in proof are sufficient--the interview of our London correspondent with a tradeunion official reported recently, and the statement of Mr Have|ock Wilson, the

‘resident of the Seamen’s Union of reat Britain, that the union will meet i :ie shipowners in conference to consider 1 roposals for reduction of wages. That s the only way in which Labour can icet the ‘ situation. The standard .of iving which was encouraged in wnrime cannot continue. There will he a edit against it, and a fight not only on he part of labour, hut a fight on the ,art of vested interests of capital, bemuse there is a position of capital just is interested in keeping up the wages >f employees not their own as is labour itself. These are especially the surveyors of entertainments and of Iress." Mr Dooley is said to have suggested that it might he necessary to reduce wages, but he insisted at the same time that there must he no reduction in the standard of living. But all the insistence in the world will not keep up the standard of living if goods sufficient to maintain the standard are not being produced. Wo have had a bounteous harvest, we have wool in plenty, and so w*e need not go without sufficient food and clothing; but if we want refinements in food and clothing, if we want more entertainment more amusement, we must exchange our surplus of wool, wheat, butter, metals, coal and meat for the goods of other countries. If we want tea we must sell Hour to someone who will in their turn sell some goods to Ceylon. Tn spite of the brave show of paper currency, tlie world to-day is impoverished. Ceylon cannot sell tea to-day to us cheaply, as she is doing, and pay us a high price for our flour. Trading must take place on an equality. The slump in trade is an attempt of the trade of the world, unconsciously probably, to restore the equality has yet been attained. Countries which are financially strong have been using their financial powers too harshly. They have askec. too much relying on their strength to force high prices.