The Guardian And Evening Star, with which is incorporated the West Coast Times. FRIDAY, MARCH 28, 1930. LONDON AS A FINANCIAL CENTRE

Hokitika Guardian, 28 March 1930, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times. FRIDAY, MARCH 28, 1930. LONDON AS A FINANCIAL CENTRE

jvast year s untoward events in the tmancial world, says a Home conimerc.'i: ■ journal, .involved a great; strain upon London, which could only maintain its position as an international centre by raising the Hank Hate to the unusually nigh figure of G.t per cent. I ne circumstance led to some complaint )>y traders anil manufacturers that the sacrifice involved was not worth, while What is exactly meant by this is not clear, hut it can scarcely be argued seriously that the country should have abandoned the gold standard, which would have been the position had it not allowed gold to leave in large amounts when America, France, and (formally were making big demands upon London. This matter was fully dealt with by .Air H. Hug'll Tennant at the recent meeting of the Westminster Hank. In answer to the complaints of traders lie showed that, in effect, the finance business of London represents one of our greatest export industries. According to Hoard of Trade estimate's, (he country in IP2B had a favourable, balance of £1 ISLOIHLOud, and of this .CGdjOOtLOOQ was I lie

result of the varied operations con ducted by banks, acceptance houses foreign exchange brokers, and other: who go to make up the London Monej Market. In the same way the opera tions of these institutions facililatec tne business of oversea investment, the revenue from which in 1928 amountec to £285,020,000. They also helped fin oversea trade, which is the file blooc of the country. Admittedly, trade am industry last year had to pay unusually high rates for credit for a time, and in some cases, possibly, the increase compared with previous year: represented the difference between ; moderate profit and ;in actual loss; but for the reasons cited above, it is perfectly clear that London must maintain its position as a leading financial centre. Apart from the question of injury to internal trade, the chairman of the Westminster Bank rightly pointed out that it is unfair to place upon the British Monetary and financial system the responsibility for the damage done by a great international monetary upheaval, an evil which London did its best to check. Equally unfair is it to lay stress upon domestic sacrifices resulting from a. wholly abnormal period without recognising such concrete and lasting benefits that may and do accrue in normal times. Without the facilities provided by the banks and others, oversea commerce might not be impossible, but it would lie a far more ha sardous and tardy process than it is to-day. The abandonment of tile gold standard is unthinkable, but even if uat serious step were taken, and Lonc ;ii in consequence ceased to he a repository of the world’s spare resources, interest rates might fluctuate less frequently than they do now, but most people woultL agree' with Mr Tennant that they would be appreciably higher on the average than those now prevailing, Jn brief, London’s position as an international centre is not only indispensable to the country’s international balance sheet, but it is also of definite assistance both to oversea and home trade. Virtually, all the chairmen of the great banks at the annual meetings recently dealt with the creditable manner in which London emerged from the great strain placed upon it last year, and at these gatherings there was more than one reference to the various unpleasant episodes which characterised 1929. both in England and abroad. Commenting noon the latter feature, Sir Harry Gosclien at the meeting of the National Provincial Bank expressed regret that in many cases serious irregularities and undoubted evidence of fraudulent practice were brought to light—a circum-

sin w-e tlmt impelled the question whether the inordinate desire to in a Ice money quickly at all costs lias not had some influence in lowering the high moral standard oP business integrity upon which Great Britain lmd been accustomed to rely. It is to be hoped, he added, that what appears to be a serious hip.se in this respect will prove to be only a temporary aberration, for last year’s experience has emphasised the fact that the maintenance of a high standard of honour and probity is the primary and the most essential basis of all domestic: and international business transactions. On the whole, a hopeful view was taken by the chairman of the National Provincial Bank of trade conditions in the country. In the course of his survey he expressed clie opinion that Great Britain had n the most suitable localities an abunlance of the material elements necessary to produce iron and steel on competitive terms with any country in the

world and had labour, both skilled and unskilled unequalled bv any other people Tn regard to.the effort of the Lord Privy Sen! to lessen the evil of unemployment-. Sir Harry Pom-hen uttered a. word of warning. He indicated that the I-'inks would welcome any sr-heme founded on sound economic principles that promised to contril)u t e to the expansion of our overseas trade, without which the United Kingdom could not enjoy that measure of prosperity and increasing population and the neeessi+ies of the time require. But it would he fatal, he said, if such public intervention led to any relaxation of individual effort, or induced tlu* counlrv to deneml upon the possi-

bility of the replacement of personal endeavour bv Stale assistance. “Our future depends in the long run not on Government ordinances, or of conforemes and committees, but neon the efforts, industry and enterprise of a united people.’’