AUSTRALIAN FINANCE

Hokitika Guardian, 30 October 1930, Page 3

AUSTRALIAN FINANCE

LONDON ANXIETY

(United Prßse Association—By Electric Telegraph—Copyright).

LONDON, Oct. 28

F The keenest interest is being shown i by the London newspapers in the - struggle in the Labour Caucus at Can--1 berra over the acceptance of the Min- ■ istrv's Budget balance proposals. ' Prominence is being given to Mr J. ' H. Scullin’s statement that he, witli ; Mr Bi •ennan, Mr Parken Maloney (Federal Minister in London) are standing behind Hon Mr Fenton, Acting Prime Minister. The latest messages from Australia are predicting the rejection of the proposals and Savouring a compromise. These are reviewed in London as only delaying and aggravating the delay of settlement. PRESS COMMENT. LONDON, Oct. 28. The “Financial News ” is featuring the fall of Australian loans consequent on the New South Wales election. It says: “The slump affords a measure of great uneasiness to which the progress of events in Australia lias given rise in the City of London. Although Mr Lang lias expressly denied the suggestions that he would repudiate Australian obligations, nevertheless tile policy he has enunciated would, if carded out, inevitably and quickly produce a state of affairs in which a default could not he -avoided. A default would infallibly close the capital markets of England and America to Australia, and would retard for a generation or more the progress of development upon which the prosperity of the Commonwealth and the maintenance of its standard of living depend. Tn Australian banking circles of London the view is expressed with some confidence that the Federal Government will have the determination to persist in, and secure, the passage of the financial programme to which it is committed. It is pointed out in the city that the immediate danger which threatens is not to the holder of Australian external loans, so much as to the Australian holder of internal loans, and indeed to Australian citizens' in general. ME THEODORE’S VIEWS. CANBERRA. Oet. 29. Mr E. G. Theodore, who is taking part in the Federal Labour Party’s Caucus discussions, and who is prepared to rejoin the Federal Ministry if invited, declared in an interview that the acuteness of l the present economic depression was due to the banks’ policy of deflation, which he described as a growing menace. The time hac! come, said Mr Theodore, when they should call an immediate halt to this deflation, and,; by reversing the monetary policy, should travel on the other road for some time. A judicious extension of credit, he pointed out, would lead to an increase in the country’s purchasing powers, and to a revival of its external trade, and would give its secondary industries the chance of availing themselves of the recent tariff protection. The banks’ policy was one of endeavoring to restore the Australian sterling to par value with the English sterling. This policy should be abandoned, as it is threatening the progress of all businesses and all industries. Mr Theodore said: —“We shall have to accommodate ourselves to a depreciated pound as compared with English sterling. This depreciation may go to the extent of twenty per cent.’’ Mr Thsdore added:—“T think it virtually impossible to avoid a heavy deficit in this year’s Commonwealth accounts.” MR SCULLIN’S ADVICE. LONDON, Oct. 29. Mr Scullin, in a telephone * conversation, told Mr Fenton that the financial position in London was mofit difficult. He stressed the necessity for adhering to the programme laid down.