ONLY A MEMORY

Wanganui Chronicle, Volume 83, Issue 50, 1 March 1939, Page 8

ONLY A MEMORY

STEADY TRADING ON STOCK EXCHANGES CLEAR STATEMENT OF POLICY NEEDED INDUSTRY ASKED TO DO THE IMPOSSIBLE. [By Telegraph—Press Association—Copyright] [Per Press Association.] WELLINGTON, Feb. 28. Mr. Henry Kitson, president of the Stock Exchange Association, spoke out freely at the annual meeting. Steady trading was now only a vague memory, he said, and he wondered if it would ever be known again. The volume of recorded business had decreased. Investors were thoroughly scared and it would take a considerable time for theim to recover. There would, of course, come a time when capital must come out in the open again and those who held today would reap the benefit. Apparently surplus money for investment had almost vanished.

A great deal of the falling away in business was due to the utter uncertainty of the financial position of the Dominion. It was impossible to get any clear and concise statement as to the Government’s future policy. For some months now' an internal loan had been in the offing and the public was naturally anxious to know when this loan and its conditions would be announced. “Uncertainty breeds rumours and rumours are unsettling.” said Mr. Kitson. “Unsettled conditions clog the wheels of industry and progress. If those in power would only make straightforward statements aoid announce the policy they propose to pursue. business might recover. People in New Zealand are entitled to know the truth and are getting tired of vague and contradictory statements. They were told that the drastic measures taken to cope with the sterling funds position was all according to plan, well thought out, carefully considered, and normal. If that is so it is sincerely to be hoped that the Government will never be called upon to introduce measures to meet an emergency.” Truth Needed. He knew it was easy to criticise and ' difficult to gi\ 1 the plain, unvarnished truth. If New Zealand had to revert to flax mats a-nd pipis, at least it was entitled Io receive some warning ahead. There was never a time in the history of New' Zealand when plain, straightforward facts were more looked for and necessary. Bluff, bluster, and political showmanship were apt to be expensive, tiresome and destructive. Sometimes New Zealand was told the import control was primarily a measure to regain the sterling position and at others to promote secondary industries. To expect the factories to cope with internal consumption in the twinkling of an eye was asking for an impossibility. Industries were not built overnight and further capital outlay was Operative. Capital expenditure was governed by the probability of profit on outlay. If by taxation these profits were decidedly uncertain. Expansion-shy. no doubt manufacturers would look carefully into the mouth of the gift horse of import control. If the oversea funds were built up by export surpluses to a figure deemed necessary how were future surpluses to be brought back to New Zealand except by opening the

door once more to imports. Surpluses could be used to repay external loans, but it was not possible to use that money as income. He reminded the meeting that £17,173,191 was due in London this year. It was unfortunate that th° overseas funds were as depleted as they were. “Apparently the only sin previous Governments have not committed," he said, “is that New Zealand never defaulted in the payment of interest and principal o.n loans. It remains to be seen just how much confidnce the fact that we have never defaulted in the past will inspire in overseas investors.” Mr. Harman Reeves, of Dunedin, was elected president, Mr. Kitson having resigned after three years' service. The meeting expressed the highest appreiafion of his work on behalf of the Associat ion. Mr. P. C. Savage, of Auckland, was elected vice-president.