PHASES OF INFLATION.

Hauraki Plains Gazette, Volume XXXIV, Issue 4561, 9 May 1923, Page 1

PHASES OF INFLATION.

THE NEED FOR STABILITY. Discussing war-time and post-war inflation of prices, and its ill-effect upon the world, His Majesty’s Trade Commissioner (Mr, N. Elmslie),■ in a speech which he delivered at Wellington last week, distinguished two phases : the first, a phase in which England suffered very severely from the fact that, prices of foodstuffs were inflated, while the prices of her goods and wages were not inflated to the same extent; and the second, a phase (already reached, or at least close to hand), in which the producion <f foodstuffs was restored, while the financial condition and general buying capacity of the world; were not restored. In this second phase, said Mi* Elmslie, New Zealand, as a producing country, would be more directly affected than Great Britain. If the prices of butter and cheese were only 25 per cent, above pre-war level, anl the prices of manufactured goods were 80 or 100 per cent, above, the producer of foodstuffs suffered because he could not get so much for his produce in values. What* was required to bring back pre-war prosperity had nothing to do with the actual level of prices. It was stability, and something of an eqiuvalent between the cost of manufacture! goods and primary produce. ‘‘Until ,we get that,” said Mr Elmslie, “we shall have fluctuations, and one section of the community or anothei is bound to suffer.”