Financial Stringency.

Hokitika Guardian, 16 July 1921, Page 1

Financial Stringency.

POSITION REVIEW FI) BY MR HAROLD BEAUCHAMP.

WFLLfNGTON, Julv 14

Mr Harold Beauchamp (chairman of the Bank of New Zealand), made an interesting statement in regard to the present financial situation. "The position, as disclosed in the returns published hy the bank for the quarter ended June .‘3oth, is," said Mr Beauchamp, "exactly what might he anticipated. They show an enormous increase in the advances and a simultaneous falling oil in deposits, particularly in those to the credit of current accounts. We can look for no improvement in the financial position for some months to come, until, in fact, we get the benefit of the realisations of next season’s produce. So tar as I can see, the acute financial stringency is likely to last for at least six months longer; and then any real improvement will be dependent, of course, upon the prices wo are likely to get lor our principal primary‘products. “To-day the most pleasing feature is the improvement in the value of cheese, and, to a lesser extent, iii the value of butter. This is due to the abnormal drought England is now experiencing, in consequence of which her supplies of milk have fallen off enormously.

"As to wool, I note with considerable interest the criticisms that are being passed upon the action of the holders of wool in Australia in particular, in endeavouring to arbitrarily fix the values. I have already indicated that, in my opinion, this action will not meet the present situation. I hold that our huge surplus supplies ot wool can onlv he realised by courageously meeting tlie market and selling at the best prices obtainable- —in other words by letting the price, or prices, ho governed by the unfailing law ol supply and demand. It seems to me that the quicker we can get our wool, particularly coarse crossbreds, into consumption at whatever price it will bring, the hotter for all concerned. There is a notable fallingoff in the value of imports, and this will continue for a fairly lengthy period. In the meantime, active efforts are being made in ail parts ot the Dominion to realise existing stocks at prices in many cases below laid-down values.” "If the English market is at all favourable,” he said, in conclusion, "it would he a distinct advantage if the Prime Minister were able to arrange for the raising of further sums of money in London for the prosecution of miichuecdod works in this Dominion.

“Judging from the utterances of certain Ministers of the Crown, it would appear as if the proceeds arising Horn the recent loan in London are not likely to he available for that purpose.”