The Guardian And Evening Star, with which is incorporated the West Coast Times. WEDNESDAY, MARCH 12, 1930. A DIFFICULT YEAR.

Hokitika Guardian, 12 March 1930, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times. WEDNESDAY, MARCH 12, 1930. A DIFFICULT YEAR.

I he present year is being regarded as a very difficult one Irani the iinancia.’ point of view. And finance carries so much in its train that difficulties in other respects will crop up. The lact that prices for staple commodities are declining does not suggest the appearance of an early silver lining, and with the unemployment problem unsolved, and winter approaching, it is possible to be justifiably pessimistic vvitli regard to the immediate outlook. Tlie credit of a country is its motive power. Obviously that credit is being restricted by the decline in the value of its exports, due to the drop in prices. In certain commodities there have been an increase in quantitis helping to retrieve the general situation, hut the aggregate fall, particularly in relation to imports, has caused a serious difficulty financially. The position here is governed largely by worid conditions. Our surplus productions which arc the fountain for our financial credit, have to go on the world markets, and our prosperity is governed by the prices realised. There has been a substantial drop in wool pri ■es with a curtailed demand also; and large quantities of wool are being held back. That state of affairs roeresonts a sharp decline in the inflow of wool money, diminishing the general credit. The butter and cheese are going off to the Home and Canadian markets as fast as it can he absorbed for it cannot he held profitably. and is going on to a declining market. There again there will be less money returning to New Zealand for general credit. And so on Uirough the staple products of the Dominion—there will he less and less credit vc-J turns. That position is going to create a general stringency in itself. In addition, New Zealand is going to feed tlie reflex of the financial position in Australia. Indeed it is feeling it

already in trade. This part of New Zealand is going to feci something of the pinch, too, in respect to timber, land the outlook in that regard is rar from pionnsing. The Dominion is also ..'ound up very closely with the Commonwealth in baniung facilities, and where has been some indication in the cables of the restrictions placed on Australians in. regard to cabling funds dome. This fact indicates how severe ne stringency is. There is much for ne public to realise at this juncture, -nd recognise that for some time to onie the stringency will prevail. The nterlocking of the financial conditions m regard to banking affecting Ausralia and New Zealand is more serious or ...e Dominion than for the Comnomvoalth. Here there is less strin■en.y in the national accounts, and rading intercourse is freer. A'et for •nuking purposes, Australia’s plight has a great deal to do with the ela.sicity or otherwise of general finance in New Zealand. This'aspect of affairs is sure to advance the popularity of a State Rank in New Zealand j which u liter present conditions would or could go a considerable way in controlling general finance. At the same time, another set of circumstances might arise u'nder other conditions where a State Rank might not lie equal to the occasion. The whole subject of finance is very complex, and it is difficult, if not impossible to control it adequately by artificial means. At the moment, as was referred tO' the other day it is gratifying that Sir Joseph AA'ard was able during the financial year now expiring to retrieve, the national financial position, and that there is every hope of the Dominion accounts closing with a surplus. That condition of affairs will be very helpful, and will ass st the country as a whole to tide over the immediate present. Winter is coming and unemployment will probably loom large again. That has to be faced, and fated in advance, so that the situation will not get out of hand. The present Government is handling the situation to the host of its resources but must expect the public and the local bodies to help cope with the demands which will be made. Everything done to assist will help in easing the .general financial position and go towards making the year less difficult all round.