SECOND EDITION Wairarapa Daily Times. [ESTAVLISHED 1878.] MONDAY. MARCH 5, 1894. CHEAP MONEY.

Wairarapa Daily Times, 5 March 1894, Page 2

SECOND EDITION Wairarapa Daily Times. [ESTAVLISHED 1878.] MONDAY. MARCH 5, 1894. CHEAP MONEY.

Uiw money is no doubt n very good tiling—for borrowers. Cheap potatoes arealso a very good thing—for buyers Tlifl Government of New {Jenlnnd hup a scheme for providing cheap money. We give Ministers credit for good intentions, but we ace inclined to think that it wouU be better for the country if they turned their attention to potatoes,* and ieft tho money market alone. Wo do not intend to discuss the scheme in detail, but we wish to malfe it clear to those'who have npt looked below thesuiface what the proposal really means. The idea is that, for a consideration, the Government of New JJealand shall guarantee lenders in London the amouot3-principal and interest—ol loans, on mortgage by individuals in the Colony, In other words the Colony is to pledge its credit to an unlimited extent to enable private individual* to boriow money at low rates of inieiett in London. What would be the result if nny Government were to bo epirjisted with such powers ? One pf tlip results would certainly be that the predit pf the Colony would suffer. Ho long as the Cojony confines itpelf to borrowing for legitimate purposes, provided that it does not oyergtep the mark, no doubt British capital will be available at modpraio of interest When (lie GovernmeuMvith the avowed intention of agisting struggling settlers-poses on a medium between tho capitrliat and the borrower, and is permitted to pledge the credit of the State for the benefit of the individual ;-Wben it is possible, we say, for any Government to take up such a position, the credit on which it relies will already have been seriously impaiied. It is idle to nay 'ihoj, ijjp State would be secured against loss by the securities it would hold, aiid that a margin of \% or 1% would cover expenses, A much wider margin would berequired'if advances! only made in laig'« sums on the wry (jest''securities," " Struggling sjetilefi)'■ are pot jtblo to giye unexceptional Btcurif.ieg, ft is all very well to taljj about WSupieme Trusts," fjtifl n)| thp pf it, (but the fact rerjajna that, if pney is tp be at low rates pf jnfereßj to perepna in want pf s.opehody wjll have to pay the pij)fiF.'