FEDERAL FINANCE

Hokitika Guardian, 20 April 1931, Page 6

FEDERAL FINANCE

BANK ’ S ULTIM ATION

WILL GOVERNMENTS BE SOLVENT? Australian Press Association.) SYDNEY, April 19. Commenting on tlie situation due to the Commonwealth Bank’s ultimatum to the Federal Government, the “Labour Daily” says: “All masks having been thrown off by our financial,., dictators and their servants, the complete insolvency of the Australian Governments within a week or two is now assured.

Editorially, the paper says: “The vultures are gathered for the feast, hovering over the hotly-assailed figure of Labour, which they hope soon to see fall, riddled with the spears of its natural enemies and the poison darts of its renegades.” BANKER’S REPLY. TO Ml THEODORE. MELBOURNE, April 19. Replying to Mr Theodore’s letter to the Commonwealth Bank Board, Mr 0. 11. Tranter, Chairman of the Associated Banks, described it as a clever piece of political propaganda. It ignored the actual position, and contained Inueh claptrap. Mr Tranter pointed out that the credit of the Trading Banks had been strained by £6,78b.810 in the past eighteen months, within which period the resources of i,hos e . banks had decreased bv twenty-tlmee millions by a reduction of deposits. Indeed credit had been strained to a point beyond which it would he unsafe to trade. Mr Theodore’s letter would further tend to disturb the public. LONDON. April 18.

The “Daily Telegraph” in an editorial says:—“Events at Canberra have wished suddenly to a political climax, to which they have been leading for the past two months, Mr Latham. might well describe Air Theodore’s statement in reference to the Commonwealth Bank as one of the most important events in the history of th e Commonwealth. Mr Scullin’? Government is apparently prepared to continue adding to the overdraft, rather than to adopt necessarily severe measures of retrenchment. An inevitable halt has now been called to that rapid march towards insolvency.

LYONS CRITICISES GOVERNMENT. (SYDNEY, April 19. Mr Lyons describes Mr Theodore’s letter to the Commonwealth Bank as being political propoganda. At the same time, he says, it reveals a base attempt on the part of Labour to erusti the present methods of banking, and he deals a death blow to the Commonwealth Bank. FEDERAL PREMIER. NOT CAVING IN. SYDNEY, April 19. The Commonwealth Bank’s ultimatum to the Federal Government is the subject of wide discusison. The Prime Minister, however, lias given no indication of the Government’s financial resources. Mr Scullin has definitely stated that the country need not expect a general election inside three months. LONDON OPINION. FAVOURS BANKERS. LONDON, April 18. Tile “Financial News” says Banking circles in London express the opinion that if tiie Commonwealth Bank adheres to its decision, the only immedite effect- will be a cessation of certain public works. Other quarters regard the news in a favourable light, as. neeessitating retrenchment and hastening the downfall of the Government. LONDON, April 17. The announcement that the Banks had declined further to finance the Commonwealth, caused an all-round drop in prices on the Stock Exchange, ranging from 2 to 5 points. j NEW YORK. April 17. i The bonds of the Australian Cornmoa wealth reacted promptly to-day to a London cablegram, reporting that the Commonwealth Bank bad threatened to withdraw credit to the Com- . momvealth and State Governments.