CHEAPER MONEY.

King Country Chronicle, Volume VIII, Issue 638, 28 January 1914, Page 5

CHEAPER MONEY.

NEW ZEALAND LOAN PROSPECTS STATEMENT BY PRIME MINIS TER. la an interview on the subject of the easing of the London money market and its probabla effect in New Zealand, the Right Han. W. F. Massey tiaid : "Thy drop in the rate of intercat which hasi recently taken place in London will be us weclome in New Zealand as in many other countries for the simple reason that when money in dear in London it is correspondingly dear in every borrowing country which requires money for development purposes. For the last eighteen months money in London has been much dearer than usual, and consequently as we depend to a great extent on London the rate of interest went up hero Now that the rate of interest in London is likely to go back io normal wo may expect a corresponding reduction in this country, and I tielicve there will be a reduction. "I think it is well known," Mr Massey continued, "that the New Zealand Government have very heavy liabilities to meet during the present year in the way of paying off a hug? accumulation of short-datod debentures, a legacy which came down to us from our predecessors, and naturally we are pleased at the change for the better which has taken place, and hope it will be a lasting change. That we could have got the money we require goes almost without saying, because the credit of New Zealand is good, but the effect of the lower rate will be felt by local bodies, by settlers, and indirectly by every class in the community. Ido not expect that the rate of interest will fall to what it wa«, say, between 1895 and 1900, but, judging from present appearances, I quite expect that money will be readily obtainable in London at 4 per cent, net, or perhaps less, and if so we should soon get back to 5 par c«nt. as the ordinary mortgage rate on good securities in this country. "Wo must not; forget in connection with financial matters," added Mr Massey, "that we are experiencing a good season with good crops of cereals, plenty of for stock, and good prices for our exports, so that from almost every point of view the outlook ia good and our prospects satisfactory."