THE MONEY MARKET.

King Country Chronicle, Volume III, Issue 153, 6 May 1909, Page 2

THE MONEY MARKET.

Prime Minister's Views. In the course of his speech at Invercargill on Saturday the Prime Minister, Sir Joseph Ward, made special reference to the financial stringency, of which so much has been heard lately. He said:— The tightness'in the mon=y market is easily ascertained. During times of unusual prosperity there was a plethora of gioney available at low rates of interest, which induced people to go in for speculation in lands and business and other investments general/.-. It was helped on the by unusual!;.- high prices in our wool market and in some of our other staple products. The fall in the prices of wool and flax occurring suddenly', reversed the position. Seme people have blamed the bank =, but I do not think there is anything to warrant this. I know nothing of individual cases, nor am I speaking in that sense, but the fact remains that ss the rseult ofthe change of policy which became " l- necessary by these institutions a considerable amount of inconvenience undeniably occurred to many people. The conclusion that I have personally come to is that with the growth of business, the increase of settlement, and with the large areas of fresh land being taken up, the banking resources at present in New Zealand are not sufficient for the amount of business that requires to be carried on. In other words, we are underbanked, and either these institutions carrying on this important branch of the work of the country shoull largely increase their capital and available funds, or else facilities should be given for an increase in the number of banking institutions so as to keep pace with the expansion of business that has gone on, and will conhtinue to go on, through- " i out the Dominion. [am of opinion j that further facilities will require to be provided, by legislation, to enable the Advances to Settlers Department to meet, to a greater extent than it is even now doing, the altered condition of affairs. Its business has been conducted so satisfactorily that if its machinery can be used to help to obtain money for lending upon mortgages to a greater extent than it is doing now, then I am of opinion that this should be done. I am hot in accord with the advocates of the paper currency, who wish to supersede the present system in operation in this country. It would, to my mind, be a fats! mistake tor any j such course to be folios:.