OUR CREDIT IN LONDON

New Zealand Times, Volume XXXVII, Issue 8363, 25 February 1913, Page 6

OUR CREDIT IN LONDON

When tho Hon. W. P. Massey was entertained by the Rotorua Chamber of Commerce last month he made a statement obviously intended to create a considerable impression on the public mind. It was this (vide Press Association report): ‘‘ Mr Massey quoted from a letter received by a friend of his (a gentleman whose name was esteemed in New Zealand arid in London financial circles) to the effect that since the present Government had come into power the credit of New Zealand had gone up enormously in tho City of Loudon, which was the opinion of large houses dealing in colonial loans, who looked for finance on sound and prudent lines, which waa ’ what was wanted to raise New Zealand to tho first flight of finance.” Now, unless the Prime Minister was indulging in pure political bluff, he was telling the public a circumstance of very great importance. Our credit in London is of vital concern to every New Zealander, and if it can be demonstrated that the latest change of Government has had the exceedingly desirable effect claimed by Mr Massey, on the’ authority of some high financier whose name we should all accept as convincing -if we only know it—-if it can be .demonstrated that our credit has “ gone up enormously ” —we shall certainly be prepared to offer the heartiest congratulations. But we must have proof. We have been carefully watching the London cablegrams for evidence supporting Mr Massey's words, or those of his correspondent. We desire sincerely and honestly to see the country's credit go up and remain at tho highest, possible altitude. But up to the present it is regrettable no have to admit that indications are decidedly contradictory to Mr- Massey and his assertion. Last Saturday wo published the cabled prices current of Lew Zealand Government stocks, and placed beside them (as usual) for com-parison-quotations for the corresponding date of last year. Now, we may be permitted to say that February in 1918 was a time when we might reasonably have looked for some depreciation in the values of these securities. Parliament was holding an emergency session, following tho chaotic results of a general election, and the political future was in considerable doubt. Moreover, financial stringency was world-wide and so acute that a little later, when the Macikenzie Ministry was in office, it was compelled to confine the term of a big loan to two years. Yet, in contrast to ■that admittedly critical period, both 'from the domestic and the broader points of view, what do we find today? The London prices we now propose to quote are as on February 21st of this year and last respectively:

Unfortunately, these figures do not show that our credit m ixmclon lias ’gone up enormously.” On the contrary, it is seen that 4 per cents, are £o ids lower than a year ago; 3f per ■cents, are £7 10s lower; 3 per cents, have also gone down £7 Ids. These conditions may be capable of completely satisfactory explanation, but they certainly appear in our view to turn the hose on Mr Massey’s Rotorua rejoicing of four short weeks ago. The advent of Reform, as the facts prove, has not had the result asserted by the Prime Minister with such a show of confidence, nor are his words yet shown to have any _ more substance than is customary in the approved self-adulatory habits of Reform. There is, in sober fact, something, very like a slump in our stocks. The happy circumstances described by Mr Massey, or by his financial friend of high degree, ought surely to have sent our securities up in the estimation of British investors. Instead of (that, the cold, unpleasant fact is that jthey have gone down very considerably.

1912. 1913. £ s. £ s. N.Z. 4 per cents. 104 10 99 0 N.Z. .8} per cents. 97 10 90 0 N.Z. 3 per cents. 87 10 80 0