AUSTRALIAN FINANCE

Hokitika Guardian, 9 July 1932, Page 6

AUSTRALIAN FINANCE

FAVOURABLE TREND

STABILITY OF GOVERNMENT

Recent favourable political developments (observes the Monthly Review of H. Byron Moore, Day, and Journeaux, sharebrokers, Melbourne) have infused a healthier tone into Australian business conditions, and the degree of confidence now being shown is considerably higher than for some time past. During the last six months the political situation has undergone a remarkable change, and there is now i\n assurance that a period of stable government, will ensue. The advent of the United Australia Party into Australia’s political history is something worthy of note. Its achievements since the recent formation of the Party have been remarkable, and there is every indication that it will play a formidable part in the rehabilitation of Australia’s economic and financial affairs.

The United Australia Party stands strongly behind the Premiere’ Plan, and we may be assured of sane government with ultimate beneficial results. The work ahead is strenuous, and the debris left by the Lang Labour Party will take many months to clear away; but ’in the meantime confidence must stengthen, which will to a large extent help to stimulate industry. For the past few months the Federal Government has been fully occupied in framing legislation to check the extreme tactics and continual repudiation of the Lang Labour Party, and the whole of its force and energy was required to carry into effect the provisions of the Financial Agreement Enforcement Act. BUDGET EQUILIBRIUM.

Tlie Premiers have been harassed by the same undesirable element in their efforts to lead all the Governments to 'budget equilibrium, and the stubborn resistance shown by the late Labour Premier of New Souh Wales has delayed any constructive efforts to relieve unemployment. The loan Council has been faced with an almost impossible task in its attempt for those unfortunate people who have been unemployed for so long. The lifting of the storm clouds in New South Wales politics will now leave the future clear for the Federal Government, the State Premiers, and the Loan Council to assemble and concentrate upon relief measures for the workless, as well as continuing without interruption the Plan which twelve* months ago was ' Introduced for the purpose of reaching budget equilibrium* and rehabilitating thf, financial and economic affairs of the Commonwealth., The return of confidence/ which ' obviously 1 must result from the overwhelming defeat of the 'Lang Labour Party and tlie improvement in Australia’s credit may make it possible for the Loan Council to raise thq funds which are so urgently required to provide relief work for the large army of unemployed. Business seconds which for many months have been disturbed by extreme political developments should now slowly respond under the influence of stable government.- It is unlikely that any marked improvement will be experienced immediately, but 'steadier trading conditions will ultimately follow, and public spending will increase as confidence'accumulates. The vast amount of capital which for months past has become irozen under fear of ipolitical interference should gradually melt} and its conversion into long term investments will indi-.-reetly, offer some encouragment to private enterprise. World commodity prices continue to fall, and it will not be possible to record any material improvement in conditions until this process of deflation is permanently checked. Probably the discussions about to take place at Lausanne on war debts and reparations, and at 'Ottawa on imperial trade reciprocity, may miive practical and beneficial results, and world affairs may undergo a decided change for the better, in which case Australia should rapidy rise out of the prevailing depressin.