CENTRAL BANK

Hokitika Guardian, 13 September 1933, Page 6

CENTRAL BANK

A CRITICISM.; BY BANK N.Z. CHAIRMAN. (Per Press Association, Copyright). . WELLINGTON; September 13. On the publication of the concluding, section of the Hon. J; G. Coates’ Central Bank statement, comments were issued to the' “Post” by Mr R; W. Gibbs, chairman of the Bank of New Zealand. Mr Gibbs said he considered the Minister had carefully avoided any useful crticism, . and had failed utterly to give any satisfactory reasons for the setting Uip of a Central Bank in New Zealad, or the advantage to be derived therefrom, “Unless, indeed, the maze of. volubility which his official essayists had prepared for him to launch on the public is thought to do so.”

Certainly we are told that a, uniform note issue would be a Commercial convenience. In what way? The trading public is quite .satisfied to get hold of the well' backed notes of trading, banks and would show no greater preference for notes of the proposed new proprietary institution. The main things these days is to get hold of the notes. The Minister denies file action of London financiers. Suppose we substitute pressure, he perhaps may not be so ready to deny that it is possible this was couched in diplomatic language, akin to qur voluntary, conversion. He may have been asked to kjndly introduce legislation “voluntar- j by,” but if you don’t ! But mv , experience of London finance language, is that it is invariably strictly honest, straightforward, direct and unequivocal.

The Minister denies that there should be any restrictions of credit due to tn, e requirements of the Central Bank, another proof of how little lie knows about the question and how deplorably incapable lie too often is, of seeing the obvious. - -

The events eonpoc.ted with the South African Reserve Bank are recent history, as also are those relating to the American Federal System > and my remarks thereon are a statement of well known facts. The proposed dangeious interference with the banking structure in New Zealand at the present time, I still maintain, warrants my repeating the Chancellor’s remark that this-is no time for’rash experiments in monetary matters.