COMMERCIAL.

New Zealand Times, Volume XXX, Issue 4552, 22 October 1875, Page 2

COMMERCIAL.

The Customs revenue collected at the port of Wellington yesterday was as follows

THE COLLIE “KITE-FLYING.” (From The Times.) The main artificial safeguard, as it were, of the banks is the bill broker. His position is that of a specialist, one who tests the credit of those with whom he deals by making it the business of his life to know the ins and outs of a particular trade or branch of a trade. It has become a sort of tradition on the part of' banks and the bigger discount .houses to rely on this specialist. The value of his name to them is not dependent-altogether or merely on what the bill broker maybe worth, but it is taken also as an expression of his opinion as to the wealth of a firm whose “ paper ”he negotiates. If the man can therefore manage to impress a number of;bill brokers with the notion that he is very wealthy and doing a great trade, he has ready to hand a machinery by which, as has been proved, almost any amount of imposition may be practised on the banks. He can then take them on their weak side. This is the key to the position of Collie and his companions in this kind of “business.” Alexander Collie contrived to spread in London a great reputation for wealth and astutenessin business, aided, no doubt, by the blockade-running traditions of himself and his brother, and he lived and acted always so as to sustain, this impression. Collie took a high view: of his position, and adopted a line of conduct in dealing with the paper he floated which was admirably calculated to increase his apparent importance. His attitude in the market was always that of a'seller, goods had been bought from him by this house and that, and he drew against the goods on the firm- in question. In some cases these firms were his dupes, in others they were part dupes, part rogues, and in others still there seems nothing but the roguery visible. At any rate, this system gave at once enormous play to the borrowing' powers of ■ his firm, for. it was a direct'and most powerful means of throwing dust in the eyes of the bill brokers. “ This great Manchester firm must bo doing an enormous business,’’ people would say, ;“here is So-and-So and such a one accepting their drafts for very large sums," and the story would pass from mouth to mouth till the credit of Collie and Co. would be to all appearance unquestionable. He took care always to sustain this idea by running down the rates at which he would negotiate his paper. His credit was too high for his bill to be done at any but the lowest current discount. Again the position of bill drawer put it into Collie’s- power to spread his operations very skilfully, so that his bills would not come to the banks through one broker nor all to one bank.' More than that, they would not even all reach the same broker in the first instance. We have inspected lists of his bills as distributed over various houses, and it is quite admirable to trace the neat manner by which the whole game was cloaked. A few firms of high respectability could only be drawn upon occasionally when goods were really sold, and the bills on these were planted judiciously here and there, all over the range of banks where rediscounting was effected, serving thus to sustain the pleasant feeling of confidence among bank managers that all was right. Firms that were the habitual “drawing party ” were also neatly handled, but as their paper was more thickly strewn, it had to be placed with extra care, so that the most cautious bank should never have more of it than seemed good for the'success of Collie’s'trade. Such a name as Shand and Co., for example, would be found on acceptances held by all the banks, but it would only stand on heavy sums where a director’s good offices or a manager’s easy temper and trustful disposition could admit the deposit with safety. By this means, too, when one set of bills became due it was easy to retire them without exciting suspicion. Bankers and brokers both, however confiding, would soon have been roused to suspicion had they been called on constantly to discount renewals of floating accommodation bills, and the operators would have found their chances gone. But things were managed so as to avoid all danger of that kind. When one set of bills fell due the proceeds of others drawn on quite other houses would be used to pay them, and it would thus seem as if they had been sent in the usual course of trade. Working thus on a fiction, the gap grew of course wider and wider with each batch, because each batch had to cany both the discount of the old and the “profits " that the operators thought it advisable to appropriate. But for that the system might have gone on and prospered indefinitely. In this way, by shifting, spreading, and mixing the few good with the many bad in ever-changing amounts, the game went on swimmingly till Sanderson’s stoppage closed one main channel of rediscounting, when the fabric came to the ground with ignominious suddenness. It was a game played with considerable skill, and the players used every advantage which the rather-loosely jointed credit system of the city allowed to keep it going. But a more heartless exhibition of cunning it is not possible to light upon. And the very heartlessness with which it.has-.heen- played does, in some measure-help-to exonerate the banks from the whole blame of it.' What they must do now is to follow the example of the Bank of England and take security from the bill broker in the shape of a margin on his rediscount transactions that he is exercising due vigilance. Nothing makes a person of ordinary sense so careful as the knowledge that he risks his own money in any venture, and if rediscounting were never done except on terms similar to those on which money is lent on stocks, a good deal more care would be shown by bill brokers in selecting the bills they bring to the banks. If the banks cannot in some such way protect themselves they must cease to trust to the intermediaries altogether. ‘ ’ BY, TELEGRAPH. AUCKLAND, Thursday. Mr. Alexander Saunders reports Sales : Cure, 505.; Beach, 755.; Tokatea, 11s. Cd. Buyers: Beach, 70s. Sellers; National Bank, 725. Od.; South British, 505.; Loan and Investment, 145.; Caledonian, 102 s. 6d.; Cure, 19s. 6<L; Tairua, 365.; Bismarck, 13s. HOKITIKA, Thursday, Beef averaged 425. per lOOlbs.; sheep (shorn), 17s. each.

£ s. a. Spirits.. . .. 38 a 1 ■\\ine .. 5 6 Coffee.. 8 16 0 Tea .. 89 i 6 Tobacco a»d cigars 7fi 12 6

£ 3, d. Sugar.. — 677 i 8 Ad val. goods 326 U ■2 Goods, weight 50 14 8 Other duties.. S 0 0 Total ..£1298 19 8