The Daily News. FRIDAY, APRIL 23, 1915. MORATORIUM RESULTS.

Taranaki Daily News, Volume LVII, Issue 269, 23 April 1915, Page 4

The Daily News. FRIDAY, APRIL 23, 1915. MORATORIUM RESULTS.

The outbreak of a war especially one involving such far-reaching effects as the present European conflict, at oilce creates a serious disturbance in finance, and unless prompt measures are taken to avoid a catastrophe there is chaos in very quick time. There is notliing that shakes a country and paralyses its resources and activities like a financial disaster. In ordinary times such a visitation has its terrors, but in war times these are augmented a hundredfold. The Imperial Government fortunately recognised its duty and responsibility in this connection, and amongst other means of meeting the situation initiated the moratorium, which was wisely made general in its scope. The Postponement of Payments Act was introduced, put through ail stages, and made law in one day, and under its powers a delay of a month was granted to debtors, with few exceptions, of £5 or over. . A panic was thus averted and breathing time allowed for the excitement of the moment to pass away. It says much for sound com-mon-sense and fair dealing of the community that it was only necessary to extend the period for a further month, when matters settled down and ordinary rights and obligations were revived, leaving only the right to invoke the aid of the Courts in any ease of special hardship. New Zealand speedily follow, ed the example of the Motherland, and passed the Mortgages Extension Act, , which, unless amended, will operate un- - til the end of the current year. As a ' matter of fact, there was scarcely any need for this measure, as the prosperity < and financial soundness of every part of ' the Dominion was sufficient to prevent { any upheaval occurring, but as a pre- f cautionary measure against advantage J being taken by unscrupulous and greedy ( lenders it was a wise, move to protect E borrowers at a time when it might bo difficult to obtain a fresh mortgage. The ' intention of the Aet was excellent, but I it opened the way to abuses which 'were . never contemplated when it was framed. I As a consequence it bus played into the « claws of the eagles always to he found P where there is a carcase to be rent asnn- ' }

del Many of those who were in a position to pay have taken advantage of the Act to obtain an extension of overdue mortgages at low rates of interest in order to invest the money at very remunerative rates, tlms reaping a harvest out of a national peril. Much the same exploitation followed in the train of tile Advances to Settlers Act—borrowing money from the Government at a cheap rate and lending it out again at considerable profit. The spirit of gnvd is rampant in some mortals, but that is no reason why it idiould tie provided with limitless spheres of action. Awother drawback to the. New Zealand Moratorium is that advances made on assets might be liable to serious depreciation if the time of repayment were extended. These and otS,.-<* infects; should receive consideration by. Parliament in the coming session. There should be full authority given to the court in all cases to compel a mortgagor' to prove that he is not in a position to pay, and remove the onus from the, shoulders of the mortgagee, and thus prevent the'concession being utilised to a debtor's; profit.