FINANCIAL STRINGENCY.

Taranaki Daily News, 16 July 1921, Page 7

FINANCIAL STRINGENCY.

“MAY LAST SIX MONTHS.”

MORE LOAN MONEY WANTED.

Mr. Harold Beauchamp (chairman of the Bank of New Zealand), interviewed by a Times representative on Tuesday, made an interesting statement in regard to the present financial situation. “The position, as disclosed in the returns published by the banks for the quarter ended June 30, is,” said Mr. Beauchamp, “exactly what might be anticipated. They show «au enormous increase in the advances and a simultaneous falling off in deposits, particularly in those to the credit of current accounts. We can look for no improvement in the financial position for some months to come, until, in fact, we get the benefit of the realisations of next season’s produce. So far as I can see, the acute financial stringency is likely to last for at least six months longer; and then any real improvement will be dependent, of course, upon the prices we are likely to get for our principal primary products. “To-day the most pleasing feature is the improvement in the value of cheese, and, to a lesser extent, in the value of butter. This is due to the abnormal drought England is now experiencing, in consequence of which her supplies of milk have fallen off enormously. WOOL PRICES. “As to wool, I note with considerable interest the criticisms that are being passed upon the action of the holders of wool in Australia in particular, in endeavoring to arbitrarily fix the values. I have already indicated that, in my opinion, this action will not meet the present situation. I hold that our huge surplus supplies of wool can „Qply be realised by courageously meet-

ing the market and selling at the best prices obtainable—in other words, by letting the price, or prices, be governed by the unfailing law of supply and demand. It seems to be that the quicker we can get our wool, particularly coarse crossbreds, into consumption at whatever price it will bring, the better for all concerned. There is a notable falling-off in the value of imports, and this will continue for a fairly lengthy period. In the meantime, active efforts 1 are being made in all parts of the Dominion to realise existing stocks at prices in many cases below laid-down values.” FURTHER LOAN SUGGESTED. “If the English market is at all ■favorable,” he said, in conclusion, “it would be a distinct advantage ii the Prime Minister were able to arrange for the raising of' further sums of in London for the prosecution of muchneeded works in this Dominion. “Judging from the utterances of certain Ministers of the Crown, it would appear as if the proceeds arising from the recent loan in London are not likely to be available for that purpose.”