THE Pukekohe and Waiuku times PUBLISHED ON TUESDAY AND FRIDAY AFTERNOONS. TUESDAY, AUGUST 15, 1916 THE WAR LOAN.

Pukekohe & Waiuku Times, Volume 5, Issue 200, 15 August 1916, Page 2

THE Pukekohe and Waiuku times PUBLISHED ON TUESDAY AND FRIDAY AFTERNOONS.

TUESDAY, AUGUST 15, 1916 THE WAR LOAN.

"We nothing extenuate, nor te,t down auaht in malice."

A short time ago Mr Reginald McKonna, the Chancellor of the Exchequer, in referring to the promotion of one of the Imperial loans for carrying on the war, pithily observed, "Exchequer bonus, are heavy artillery, and the smaUer bonds are equal to rifles and hand-gren-ades," and proceeded to amplify his point by showing that an abounding supply of money for war purposes was as necessary as the supply of men for the firing line.

When our own National Government determined ta raise a war-loan in the Dominion instead of purs' iig the usual course of going to the London money-market for funds, they took a course that has a good deal to recommend it. Already, during the war, Britain has been bled to the enoroious amount of eighthundred millions to finance her Over-seas Dominions and her Allies, and it was wisdom not to further add to her burdens if it were possible to avoid it. Now, if never before, is the time that New Zealand should show her self-reliance and boldly prepare to carry unaided her own little bit of the burden of Empire.

It is true that the amount asked for, eight millions, appears to some a little bit startling and critics have not been lacking to declare that it will not be forth-coming, or that if it is it will lead to a serious diminution of the amount available for loans to business men and farmers. We have, however, sufficient confidence iu the patriotism of our people to believe that the money will be found. As for the other point we do not think it at all probable that any serious dislocati n of the money-market will follow. A very large sum—certainly not less than twelve millions, and probably a good deal more —has come into the Dominion since the war began as a result of the increased value of our exports, and, partly owing to this and partly to an element of uncertainty in the minds of investors causing u disinclination to disburse their capital iu the usual channels, the banks have been suffering from a plethora of deposits, a very large percentage of which could bo freed for investment m m the war-loan without disturbing the business of the couutry. Wo have, in addition, the assurance of tho Finance Minister that tho money will be spent in New Zealand. The advantage to the public

finances that ensues from the successful ilot&tiou of an internal loan is obvious. The price of raising an external loan has always been heavy owing to the cost of brokerage and under-writing, and the usual amount received by the Treasury has been from £O3 to £OS for each £IOO borrowed, although at the end of the term of currency the lull £IOO has to bo paid back. In the case of this loan, United at par, the Finance Minister will re-

ceive his iJ 100 nctt. The advantage to the community is no l«ss per I spicuous. The interest of an ex- J ternal loan goes out of the country | and is lost for over ; Unit of an ■ internal one remains here and goes at once into ciivulntioii, to the benefit of the whole Dominion. To the investor the loan oilers a security based on the solvency of the Dominion, and therefore standing upon n linn li more n siireil h:iM than a loan i>> any |>n\ <<'" indi\ Muni or institution. Tin' intercsl, p;i\ ■

able half-yearly without any deduction for taxation, is at a high rate considering the unexceptional nature of the security. And, although the ! currency of the loan is from 14 to 25 j years, money invested in it will j practically be at call, for the bonds, j ranging from £SO to £IOOO, will bo almost as easily transferable as j bank-notes. To the man who does not wish to tio his money up on mortgage, and who shrinks from the risk of speculating in stocks and shares, the loan will solve the question of what to do with his capital.

To the trustee who has to face the question of finding for the funds he is responsible for a security at once safe and remunerative, the war-loan will come as a happy lelief, for it will provide with absolute secuiitv an investment returning, when the freedom from income-tax h taken

into the equivalent of 5J per CiLt. And widows and others, who have reither the desire or experience, nor the aptitude to graopie with, busiuess wonie3 and anxieties will find in this fund a safe haven for their fortunes.

In the war-loan certificates, which must not be confounded with the band?, the large class of people with small means but thrifty habits, who desire to make some provision for thj futurF, will fit d a mode of investment preferable to any oth2r rifling. Obtainable at any Money O.dit Post Office, these certificates of £1 and £lO each may te bought at 163 and £8 respectively, and at tße end of five years will be redeemed at I heir full face value, tbus returning compound interest at the rate of 4J per cent. They will be payable to bearer, and can therefore be transferred from one person to another as freely as cash. We are sure that our people will provide the Government with an ample supply of these "rifles and hand-grenades."