A GLOOMY PICTURE

Taranaki Daily News, Volume LI, Issue 128, 21 May 1908, Page 4

A GLOOMY PICTURE

SOUTH AFRICAN DEPRESSION. VIEWS OF A CAPE COLONIST. Mr. W. Black, a Capetown architect and City Councillor, who is visiting Wellington! ha s a dismal tale to tell of depression in .South Africa. Speaking to a Dominion reporter the other evening, he said that many of those, who wer.considered the shrewdest business men in Cape Colony jiad fallen victims to the financial crisis. . The slump was partly clue to the fact that money had in the past llowed into the colony in torrents from British and loreign sources, so that finance became mere child's Jilay.

"l'cople gambled in property and shares with an insignilicantly small margin of cover," said Mr. Black, "and city and suburban values at Capetown ha v. l shrunk, so lint it is impossible lo ,-ell holdings for even one-tenth of their original pic-linom values, and nil iiiuiii cipal rates anil taxes are so terribly inMated that property owners are desirous of realising at any price. To take a rese now ill my mind, a certain speculator bought a small central properly in Capetown fur £:i,i()o. The City C-r----poration assessed the value for rating purposes at £251)1), but the slump set in, and the purchaser could not sell. Eventually, the Official Assignee put the land to the hammer, and declared it sold for £BoO.

" Another instance. A propertyowner who, lik<« many others, lived in a. sort of fool's paradise before the depression, was then drawing ,C2,"i32 -a year from a block of city buildings, Hi-.' n-ntiil of which docs not now amount to more than the rales, taxes, and insurance. property cost .ti!),50ll, ami was afterwards sold for .15,UHU. That was only one of many similar transactions. The Master of the Insolvent Court ha H had to step in and prevent many sales taking place at liguros much below the bonds existing on tlie properties. It is no uncommon thing for a bondholder to lake back his properly and pay the transfer dues for a quarter of the amount of the original mortgage.

" Jn Johannesburg the distress is ton awful for words. Families have kept themselves from (starvation by selling their few sticks ot furniture. Property has fallen as much us in Capetown. I'coplc at Johannesburg have been very improvident, ami have lived more or lc-s a life of continual excitement and speculation. The share market was the constant topic of conversation, and every ruse or subterfuge that could wile the coin out of the pockets of the unwary was adopted. What was not lost in pr-'peiiy went in D erip.

'■ The' slump in mining is partly due to the fact that most of the mines were over capitalised at llotation. Further, a great number of the mines yield only -uch low grade ores that they will not pay for anything more than the wages of' Chinamen at a few shillings a day. I hope legislation obtains in this happy country to prevent sheep and cattle ranches being floated as gold mine-. In any case, 1 -hope your people will keep an eye on over-capitalisation, lest ihey experience the same troubles as South Africa."

Asked whether there was no silver lining to these dark clouds, Mr. Black said that the, present depression in the eities would result eventually in incalculable benefit to the whole country, because it was causing an intense desire for settlement on the land. I'coplo were turning their thoughts to the more genuine pursuits of agricultural and pastoral production. The reaction had already had s olid results, for c.211.0011 worth 01 grain, grown from Algerian seed, had recently boon exported from Cape Colony—a small beginning, which yet might grow into something that would do much to right the conntry. Dairying also, on the co-operative principle, was spreading. The net! lenient that was expected to follow the war ]|iiil not come. That was the fault of the Government, which had promised farms for the troopers, but was not ready wilh any scheme Tor carrying out such a policy. The agricultural revival, however, had now begun, and it was the most hopeful feature of the situation. The diamond industry would, no doubl, revive later on, and become as lucrative as ever, 'Perhaps, in a few years' time, South Africa would not altogether regret the troubles which their country was now undergoing.