THE MONEY MARKET

Hokitika Guardian, 8 September 1928, Page 2

THE MONEY MARKET

AN AUCKLAND REVIEW/. AUCKLAND, September ,6. Although trade is still on the dull side, money for investment is plentiful The substantial Surplus shown by the National Traditig Account is finding its ' way .through -financial channels which lead to the Stock Exchanges and securities. This tendency has been, marked for some time in Auckland. A' factor in the present situation is that few now local body debentures are on the market: Not long ago there was considerable business in such debentures that showed a return of 6 per cent., but the demand has forced, values to a figure Which does not give such a return. Mount Eden 53 per cent., for instance, have buyers at £IOO. • A sharebroker mentions-that there is a constant demand in New Zealand for the better class of Australian securities. “All this buying”, he said “is a drain on Dominion capita! and . tends to handicap our own industry and enterprise, but. in my opinion it is tlie inevitable result of the artificial cheapening of money that is done by the Government in lending .at cost price through the Advances to Settlers with money without having adverse elloets somewhere. I am not competent to sav whether in the long run the country gains more than it loses through the State lending' at lower than the market rates, but I do know that tlio seller of such mortgages lias.a chance of capitalising his advantage and that his successor is probably no better off than if lie paid normal intores L

The impression gathered from legal offices where the share investments are rare is that money for mortgage investments is offering freely at lower interest than prevailed a few months ago. Sound City mortgages are being arranged at 6 nor cent., under some competition. In regard to farm securities there is still some hesitancy on in the part of lenders, but not on the degree as of late. At 61 per cent, farms showing a safe margin are not londing basis is the actual land value with less relianco ou “personality.” '