The Daily News. SATURDAY, JANUARY 22, 1921. TRADE OUTLOOK.

Taranaki Daily News, 22 January 1921, Page 4

The Daily News. SATURDAY, JANUARY 22, 1921. TRADE OUTLOOK.

Among the most recent contributions to the question of overseas trade those made by Sir Joseph Ward and Mr. F. Kelleway. (Parliamentary Secretary to Britain’s Department of Overseas Trade) are particularly worthy of notice. Both these authorities agree that the exchange deadlock is adversely affecting the development of international trade, and that no appreciable improvement can be expected until trade with the Continent is restored. There is much force in Sir Joseph Ward’s contention that it is useless to advocate an increase in exports if the exporters are unable to get money for their goods. Although Mr. Kellaway considers that international credit schemes are a step in the right direction, he is of opinion that they are not likely to be ready to operate in time to relieve the present depression. He also considers there are grounds for restrained optimism regarding the I trade outlook, “chiefly because

we are leaving the period of abnormal values and finding real ‘ values leading to stability and progress.” There is far more in this argument than appears on the surface. The soaring of prices charged for commodities in gen- : eral use, the heavy taxation imposed on the people, the great depreciation in the actual value of the standard currency, the consequent rise in the cost of production and the exercise of Government control, had led to fictitious values being the rule. In saying that “the sooner the Governments within Europe make up their minds to discontinue control of commerce, and Britain realises that she cannot maintain fictitious values, the better.” Sir Joseph Ward expresses a view that is. almost universal. The recent practice of estimating trade movements by the standard of the value of commodities and not by their volume is certainly misleading so far as indicating the upward or downward tendency of production. The fact is there are ample supplies of raw material available for stimulating industrial expansion, but there are several factors which stand in the way of that expansion—factors that are ever moving in a vicious circle and can only be eliminated by removing the causes to which their existence is due. There is no royal road to a. Readjustment of trade conditions, but the shortest cut in that direction is by facilitating payment for goods and resuscitating business in Europe. The demand exists for as much output as the manufacturers can secure, but only at prices that will return very greatly reduced profits. Unfortunately the economic principles governing production and consumption are not generally understood, but it is quite possible that a trade collapse njay fie averted by the application of common sense to the problems connected with reconstruction. If the tendency to drift is once effectually cheeked, there may be some hope of a common understanding being' arrived at, that will lead to a solution of the intricate matters affecting the trade and commerce of the world, but the first essential is that the burden of taxation must be lightened, for until this is done, and Government control of prices is removed, the cost of production will be a bar to increased output, as to the world-wide demand for goods that are sorely needed.