Wairarapa Daily Times. [Established 1874.] FRIDAY, APRIL 5, 1895. MR HOGG AS A CURRENCY REFORMER.

Wairarapa Daily Times, Volume XVI, Issue 4994, 5 April 1895, Page 2

Wairarapa Daily Times. [Established 1874.] FRIDAY, APRIL 5, 1895. MR HOGG AS A CURRENCY REFORMER.

At the weekly meeting of the North Wairarapa Liberal Association held last Monday evening, Mr Hogg, M.H.R., took the opportunity of airing his knowledge of finance and

dealt with tho reform of currency. Tho prevailing depression and the! disturbance in the currency caused by the " outlawry" of silver by several nations, has brought money intoa prominentposition. It possesses many names, and is known as" The Silver Question," "Bimetallism," " Currency Reform," " The Standard of Value." and other high sounding titles, while it is impossible'to take up a newspaper without seeing some reference to the subject. It is one of the burning questions of the hour, and wc are pleased that Mr Horn has given some attention to the subject, even though his viows are not altogether satisfactory, but Mr Hogg disarms criticism by bluntly acknowledging that, the opinions expressed by him may be crude and imperfect. It is not our purpose therefore to cxamiuothe lecture critically;' but to add to the interest of tho subject, if possible, by adducing further evidence,

Mr Hogg holds the yiew that a paper currency is the ideal medium of exchange, but papor is not to banish the metals but to supersede them. We gather from this that the State paper is not to bo of an " inconvertible " character as the American greenback or the French assignat, but the State guaranteed paper is to be readily convertible j into gold or silver on domand. This would bemerely taking over the note issuo from the Banks and vesting it in the State, Surely there is no lack of paper money inNew Zealand, bank notes are as plentiful as one could wish, but the difficulty of getting hold of them is great. No one can dispute the right of the State to regulate tho noto issue, or to itself issuo paper money, but all attempts to make State guaranteed paper inconvertible, or irredeemable in gold at the will of the holder have proved failures. So long as a ponnd note can bo changed for agolden sovereign' the paper will circulate at its face value. What would be the gain to New Zealand of a paper currency

issue a>nd guaranteed by the State ? The fftct of the pounoYnote being State guaranteed paper would not increase its circulation; tho' people would not be any the riohei' for it, and our produce would nol improve in price ■ on that account, The position we stand in just now is that we have for a consideration given to the banks the right to issuo notes subject to certain conditions,'and Mr Hogg's proposal is to cut the banks adi'ift.aml for the State to undertake tho issue of notes. A State bank of issue is in operation in Canada, the Act authorising the issuo of Dominion notes came into force in 1886, and provides tint the Governor in Council msy authorise the issue of notes not exceeding twenty million dollars (£4,000,000) at one time, and not oxceeding four million dollars (£800,000) in any one year. The Treasurer lias always to hold, i for securing the redemption of such I notes, an amount in gold, or in gold and Canada securitiesguaranteed by the British Government, not less than 15 per cent, of tho amount of the notes issued and outstanding. The notes are legal tender in every part of Canada, but they are redeemable in specie on presentation at certain Government branch oflicos, or at certain banks with which arrangements are made. It is found in Canada that the Government cannot circulate its own notes, and the hrtnks there are required to buy a certain proportion from the 'treasury. A State bank of issue is a fad and nothing more.

It is an easy method of accounting for tho fall in prices, to say that it is duo to the appreciation of gold, or demonetisation of silver, but have not the multiplication of laboursaving machinery, improved means of transit, affording quick and easy access to tho world's markets, something to do with the decline in values? Has not over-production contributed to the fall in prices?) And above all, is not the want of confidence and consequent restriction of credit, an important element to be taken into account? Money was never so plentiful as now, and never, perhaps, was the speculative spirit so essential in business, more absent. Investors are timid, and require to be absolutely assured against less, before they will advance, and their demands are therefore apparently harsh and exacting. Appreciation of gold is not the only cause for the depression, and the other factors must be taken into consideration. How to restore commercial conlidencc, is of greater moment than tinkering with our note issue. Confidence is a plant, of slow growth, and we should be careful not to prevent its growth by wild-cat schemes.