WELLINGTON NEWS

Hokitika Guardian, 12 March 1929, Page 2

WELLINGTON NEWS

THE SMALL BORROWER. [Special To The Guabdian .] WELLINGTON, March 9. The Americans appear to be highly inquisitive in respect to commercial, industrial and social matters, and have a very strong- penchant for gathering together reliable statistics on all matters that interest- them. Recently the small borrower has received attention, but who is the small borrower ? He is often reputed to be thriftless and idle and usually the victim of his own carelessness, but up to the present no investigation has been embarked on to scientifically ascertain his precise character. In the United States some trouble has been taken to find out what sort of individual he generally is, and if human nature is the same here as it is there it may be accepted that on the whole he is a much maligned individual. Messrs Lee, Higginson and Co., a prominent firm of brokers and financiers of New York, recently sponsored this interesting little social study in Massachusetts, and have discovered that the majority of small borrowers are worthy citizens and heads of families who have been obliged to raise money from all sorts of simple causes, whieh by getting out of proportion in domestic circumstances where no margin exists for contingencies, suddenly assumes an abnormal instead of a normal complexion. It was found that these people of all classes from miners, electricians and farmers, to teachers, doctors and clergymen. They embraced almost every imaginable, trade and profession. A group if 100,000 loans represented no less than 1 700,000 different occupations. The financing of these small borrowers in America is now attracting the attention and the serious' attention of banra. and finance houses. The small borrower has been long left a prey to the loan shark' and the unscrupulous money lepde< but legislation has intervened % protect him to some extent of la|* years, though there are still many lays in which he can be advent of banks into the businefe#Quld be a novel departure and certainly not worsen the position ;of the borrower. NEW MOTOR TRADE. Zea%id • sfcnt last year £4,176.0(50, or "at,;the average rate of X" ■ ‘ V

£380,000 per month or nearly £11,500 per day for every one of the 366 days of. 1928 on motor cars, trucks, chassis, motor cycles, tyres and parts, and of this United States had gathered in £1,768,883, Canada £1,229,602, Great Britain £1,002,847, and other countries, which were France, Italy, Belgium and Germany, £174,728. The United States drew from us in respect of the motor trade an average of nearly £5,000 a day for every day last year, Sundays included, and When we offer them our tvool, frozen meat, butter and cheese in exchange, they reply, not very politely, “Nothing doing.’ It is a one-sided business, and we are rather big idiots in teleratmg it. Surely it is within the intelligence of our legislators to devise a method of putting the matter right. Supposing it was decreed that all countries admitting our products free, would be allowed to export an equivalent number of products to New Zealand duty free, those that imposed a moderate duty ivould have a selected number of goods on which the duty of 25 per cent and 50 per cent, and those who imposed extreme prohibitive duties would be taxed 100 percent. That would make American motor manufacturers sit up and take notice. Last year there were 16,504 motor cars imported into the Dominion as compared with 10,871 in. 1927 and 20,328 in 1926, thus there is an increase of 5,633 over 1927 and a decrease of 3,824 as compared with 1926. In 1925 the balance of trade was in our favour, and believing that high produce prices had come to stay and prosperity with them, everyone who could raise the deposit secured a motor vehicle. prices refused to'stay high, and the slump saw the development of a lot of used cars, many of which came back to the vendors, and the imports of motor cars dropped by nearly 50 per cent in 1927 as compared with 1926. The produco season 1926-27 showed some recovery with improving prospects, and with the recovery and improvement the imports of motor cars in 1928 increased by over 50 per cent on the figures of 1927. As the season of 1928-29 gives every indication of again showing a favourable trade balance the imports for 1929 of motor cars will probably again show an increase. But it is not unlikely that both dealers and bnyers of motor cars will be caught m the toils if the Bank of England » nga obliged to raise its d.scoaat rate . ml that is by no means .mprobable the effect of dear money will be mu more severe than when the rate was

raised on February 7th. It is oi course too much to expect the average New Zealand trader to keep an eye on the London market and operate in sympathy. When the London branches of American banks offer 6$ per cent for deposits fixed for three months, and 8 per cent lor six months something must happen as the result of this. The high rates offered will attract a considerable amount of loose funds, and thus must cause a shortage in other directions, and also disturb the exchanges. .. The cautious trader will be careful about his commitments.