THE FUSLE OF TRADE.

Taranaki Daily News, Volume LII, Issue 122, 23 June 1909, Page 4

THE FUSLE OF TRADE.

A BRIGHTER OUTLOOK. ' WHAT XEW ZEALAND NEEDS. "CHEAP LAND, NOT CHEAP MONEY." In the course of his speech at tlie annual meeting of shareholders of the Bank of Xew Zealand in Wellington last week, the chairman (Mr. Beauchani|i) dealt at some length with the financial and commercial conditions that prevail to-day, and the outlook as to the lulu's. It would be idle, he said, to deny that J. monetary stringency is being felt in Xew Zealand; ami it was mosi d.ocuiicerting to have to admit, in view of the long period of prosperity—covering practically fifteen years—that a. sudden drop in values of our primary produce, for one season only, should cause such a liniinual disturbance as we have been experiencing. The sudden fall in values, however, was not wholly responsible for this. If we sought other causes we had to recognise that they would be found in the inordinate prices paid for land, and general extravagance amongst all Sections of the community. "What we want in Xe'w Zealand today, more than cheap money, is cheap land," he said. "Had land values been maintained at their normal and reasonable level, we should not now be troubled with a monetary tightness, or with the distress arising from unemployment. Until land is bought and sold on the basis of its productive value in nor- | mal times, we cannot hope to sec that equilibrium necessary to maintain comui'sreial stability. Tlie farming industry in the Xerth Island would lie greatly stimulated iflargo areas of native lands now in a state of nature ccmld be oll'ered fo r settlement upon attractive terms. If they could be sold or leased for reasonably long periods, they would materially assist to satisfy the demand for land, and »t the same time lie the means of adding' to the. wealth of the community. If we compare the present with the past, and accept as an index the state of trade as disclosed by the bankruptcy returns and other general iiulications, we need not expect that the depression, though sharp, will prove to have 'been so acute or as lengthy as' on former occasions. The financial stringency is not quite so pronounced at the I moment as it was a few months ago, and this is in a measure due to the fact that local bodies have to a large extent refrained from 'borrowing within Australasia. Since June, 1!)0S, the local bodies have raised successfully in London loans amounting to a total, of X. 1,410.(10(1, and the Bank of Xew Zealand has taken an active part in placing most of these loans, our proportion being rather more than SO per cent. The London money market has been exceptionally easy (luring the past twelve months. Money is to-day very cheap in London, and as tlie outcome of this there is a great rush of borrowers. -For short loans' the rate is abnormally low, but for long periods capitalists seem disinclined to lend, except at comparatively high rates, say from 4 to 5 per cent., according lo the attractiveness or otherwise of the security oll'ered.