THE FINANCIAL POSITION.

Taranaki Daily News, 11 September 1920, Page 11

THE FINANCIAL POSITION.

.VIEWS OF HON. A. Mi MYERS. London, Juno 26. At the invitation of the Chairman of the Commercial Committee of the House of Commons, the Hon. Arthur Myers, exMinister Of Munitions and Acting-Minis-ter of Finance for two years in the National Ministry of New Zealand, was present at a meeting of the committee for the purpose of hearing Mr. F. G. Goodenough, chairman of Barclay's Bank, read a paper dealing with the present financial outlook of Great Britain, especially dealing with the aspect of deflation. Mr. Myers, on being asked by your Press correspondent whether Mr. Ooodenough's remarks affected New Zealand stated: ''Although the Dominion's" financial problems are not identical with those of Great Britain, we are directly interested in the international aspect so long as gold is the existing standard for the payment of our external debts. While we require money in New Zealand for further necessary and justifiable development of our great resources, the solution must bo in the direction of endeavoring to encourage capital to be freed as far as possible for the purpose of developing our industries to the fullest pos- • sible extent, and bo increase production. | We all realise the difficulties in the pre- ' sent-day financial problems, and the neei essity for our rulers to decide how much j the country could be safely called upon to ] pay in the way of taxation. While in I Great Britain they have a large floating j debt and one of their greatest creditors is ' their greater,t trade rival, we are fortuI nate in New Zealand that we do not have : to face the early repayment of our nal tional debt, as, although some £34,- ! 000,000 loans are falling due during the ] next six years, all but half a million mature in New Zealand, and while large \ sums of money will annually continue ! to be required for development purposes, : I believe New Zealand will be able to borrow her necessities in this respect from her own people at a lower rate of 'interest than would have to be paid if ; it were possitye or desirable to float a loan on the London market. "The question of deflation, lowever, is common to New Zealand, as well as other countries, but before any action is) taken due regard must be given to the responsibility of the banks meeting the | legitimate demands of trade and indus- ! try. In a word, if a reduced volume of I credit is necessary it must be iudiciousj iv applied, especially as one must not forget taxpayers naturally had to pay to the State so much more thin formerly, and consequently would have to look more to the banks for extra accomodation. "Although,-'' stated Mr. Myers, "Mr. Ooodenouglr's address dealt principally ; with the monetary n=pect of deflation, | it was most interesting. and will be weli comed by all those who take an inter- | est in the important financial problems j with which nil countries are faced at | the moincrit. To increase the purchasing j power of money there must be increased I production in ftll aspects of our aetivij ties, and to bring about a healthy liqj nidation without curtailing production jor disturbance of legitimate commeroe and business."