The Wairarapa Daily. TUESDAY, MAY 27, 1879.

Wairarapa Daily Times, Volume 2, Issue 169, 27 May 1879, Page 2

The Wairarapa Daily. TUESDAY, MAY 27, 1879.

The present depression in commerce throughout New Zealand can scarcely be described by the term ' panic.' The main causes of it are so palpable, the cure of it is so patent, and the limits of it so apparent, that the feeling in most persons minds is one rather of annoyance than alarm, There is faith in the wealth and resources ol the Colony, and nothing yet which has transpired ' in the way of either Bank pressure or business failure has tended to any appreciable extent to shake it. Panic is happily a state of alarm to which New Zealand is as yet a stranger, and it is as far as we can see likely to remain so, . At intervals panic hits been experienced in England, but there it was caused by the existence of large financial companies, such as wc do not fortunately possess in this Colony, In the memorable year of ISG6 the rate of discount at the Bank of England rose to II) per cent, and remained at that abnormal rate from the month of May to the 1 month of August. In tlmt year I here were commercial shocks in the mother country compared to which the mild : shakings wc are now enduring here an; as nothing. To put New Zealand on a par with England in 18CG the Bank ' rate to be proportionate would have to be double what it is at present. Twenty per cent, could be more readily paid in New Zealand now for advances than 5 ten per cent, could be in England then. It was curious also to notice the gradual , manner in which in 18CC the rate of discount rose and fell. It commenced to rise in March, and in April went as high as 6 per cent. In May the panic ■ came one Black Friday, as it was called, and within a few days it ran up step by step to 10. In August it fell to 8, and by the end of the year it was at t per cent. Judging by analogy we are inclined to believe that within a short time money will be cheap in Now 1 Zealand, and that in tho Spring where i it is now difficult to borrow at ID per cent, it will be easy to get accommodation at 6. Times like the present arc 'f required periodically to purge commerce. Already we see that the process of purging is well advanced in Zealand, and when once commercial . circles are purilicd there will bo a healthy revival of trade and adequate means will be available for till legitimate business operations, None but a few strandsd speculators will regret the unhealthy inilation of credit which has characterised the past few years, or the unnatural enhancement of the value of land and merchandize. Ail commercial history tends to show that rash speculation is inevitably followed by it sudden collapse, and that in the long run moderation and prudence in business arc the best safeguards. A return to them for a season is generally acknowledged to be the only remedy for the ills which we now endure.