FINANCE AND TRADE

Hokitika Guardian, 21 July 1925, Page 4

FINANCE AND TRADE

— ; FORTNIGHTLY TRADE REVIEW. THE RUBBER BOOM. OX ’CHANGE. [Australia A X./. Cable Association.] LONDON. July 18. Features of the Stock Exchange durng the past week have been the rul>her share boom and the marked strength of gilt-edged stocks, the latter. of course, being responsible for the decision to issue the Commonwealth's loan forthwith. The rubber boom on Monday produced the wildest stock exchange scenes witnessed since the war. feverish buying being carried out without regard to price or values of particular shares. This wild orgy received a. check on Wednesday when, in consequence of a slight reaction in the price of raw rubber, tens oi thousands of shares were rushed on the market. Those, however, were soon absorbed and the market, rallied. Xo real slump in these shares need bo expected till tbe price of raw rubber drops considerably. Hitherto the Government has . refused to interfere in the Stevenson production control scheme, regarding the present fancy raw rubber prices as merely a temporary phase which, will soon right itself. LOANS IX AMERICA. The Commonwealth’s loan policy departure in going to Xow York for three-quarters of the present loan requirements has occupied ;1 conspicuous place in all financial commentators’ writings, both in the daily papers and the more considered judgments of weekly financial reviews. '1 he London portion of the loan was well received ami will meet the gilt-edged market, which has steadily improved in flic past three weeks under the influence of the Bank of England gold position and strong hank returns. Xow that the Commonwealth’s arrangements have taken definite shape the reasons and influences which brought about the decision partially io forsake the London market form the basis of innumerable newspaper articles iinoil Loudon's general position as a lender to the dominions and colonics. Ihe tone of financial writers’ comments upon this subject seems everywhere to vary in ueeordaliee with their views upon the wisdom or otherwise nt the recent leturn to Uie gold standard. The financial I Toss does not seem quite clear as to us attitude towards the Commonwealth’s decision to go to Xow York. On ihe one side it- is argued that we have dangerously over-lent, had trade, and over-high consumption having reduced our capacity to lend abroad. The “Statist.” on the other hand, says: “It is in god that only by lending abroad can Hade he improved. There are manv factors tending to cheek over-lending, hut the olfeet of the Thistee Al ls has been to enable colonial Governments, whatever their financial records or capacity to raise money, oil almost as good terms as Britain. J'«r niir part it seems more important to know whether Australia has licon overborrowing than whether we have been ever lending.” Other writers emphasise that the return to the gold standard was decided upon with the dominions' concurrence and support, and it was probably recognised at the time Hint it- would necessarily entail the limiting of London's external lending, 'the “.Statist’’ welcomes as a virtue of the gold standard lilt* fact that it ha- given n clear indication how tar the country is capable oi holding ml. To tlie argument that the embargo in fo'iign investments and the necessity for tln Commonwealth go to New York have proved that the gold standard has been mI il.,- ~,iiiiii i v Hie “Statist”

replies thiit t!u- country t-nnnot- lend mure than it saves. that Britain ill ]:resulti is barely makiii>4 ends nmut and that, 11 ~t-1111 \. tin? gold .standard's automatic check to uvcr-lendinc should *«-• v. demited. THK WOOL SALKS. The results of tin- London wool sales, j,, lot 11 merino and eroos-Lrud. have in 11, -. •11 heller spirit into tile law material seeliim of the Ifradiord trade, tmt develojinieiits at the manul'arttiring end have been in.-re d isappoi nt - jug than was anti: ipateil a week ago. \e ,\ business in initially and fully ma 11 ulaettired omuls has not increased to the extent expected when the sales (..polled, ovine largely to the wanes dispute eitused h.v tlie employers’ intimation of the intention to enforce a live per tent I'i.tlu. lion in wattes and as the workers are determined to resist a strike appears inevitable- from present indications, in view ol this possibility neither .spinners nor munuiaet urers are anxious to buy till tin l out' took is clearer, with the result tlmt neither London nor Australian sales had much clleei on llradlurd. where prices for tops have not. telioved the lean set by the raw material. VHK DAI It V Liinnrcv. A! AI IK K.T. The continuance of dry weather has had tlie elieel of increasing butter and cheese prices. It is noticeable that Australian and Xew Zealand butter continued to harden, despite a slic'd weakening of Danish. The. for mop have ailntncotl ever since Thursday. Arrivals from Australia and Xew Zealand during June wore heavy and there mo la rue quantities in (old stores, hut in view of the exj a tided consumptive demand it will till ho needed. The trade forecasts (inn

prices both for butter and cheese for

some time to come. (’A NX HI) AND DRIED FRUITS. The canned and dried fruits trades have both been at their quietest, the hitter .suffering a lull following on heavy sales prior lo the removal of the (buy. It is too early to say whether sellers will, lie enabled lo maintain present juices.