CORRESPONDENCE.

Wairarapa Daily Times, Volume XVI, Issue 5011, 27 April 1895, Page 3

CORRESPONDENCE.

THE MONEY QUESTION.

[to tiie editor.]

Sir,—l congratulate you on the attention you have given this matter. As a close student of the subject for some years, I should like to address you on the subject. Regarding Mr Hogg's lecture, I take it that he advocated what is known as date cur«ncy. In that caso true paper money list be inconvertible, except to people leaying the colony and requiring to change the State notes into the international medium—metal coins, Convertible money, as we understand it, is a fraud, delusion, and snare, and there is not a bank in the civilised world, whose paper, if presented to-morrow, could be converted into coin, or anything like it. The banks in New Zealand for instance, hold three and a half millions of gold. Their paper liability all told is about fifteen millions. How could they convert fifteen millions of paper with three and a half millions of gold ? This will show you what afraudulent thing the present banking system is. It is based on the faith of the people, for if tho people demanded their own to-morrow there is not a Bank in the Colony that could lift up its head.

you say there is no lack of ]Ber money in New Zealand, but it is difficult to get hold of. Well, here is an eye-opener for you. History shows that nations have been most prosperous when they had a circulation of £lO (ten pounds) per head. In France it is £l2 per head. In New Zealand it is thirty shillings! How doyou reconcile with this your statement that there is no lack of paper money in New Zealand, The fact is that the expression "money is tight," is a veritable reality.

Again, the banking returns show a contraction of business of recent years from £27 per head to £l9 per head. Now, any contraction of money in a country whosepopulation is increasing is clearly an absurdity, as it can only mean iinancial crisis, ruination, poverty, dearth of employment, underconsumption and low prices,

you ask: " What would he tp gain to New Zealand of a paper currency ?" I will tell you, At present the hanks carry on the money business of the country almost entirely with their notes, Thoy pay the Government one-half per cent, for their notes, and they charge tho people seven to twenty percent, for them! Now, why should the banks reap such a harvest as this, by levying such usury on the people for the use of their own credit ? The fact iB that, if the Government can let the Banks have money at a half per cent,, it can let the people have that same money at two per cent. The Government would thus have a profit of U per cent., which could go to the establishment of an Old Age Pension Fund, without a penny of taxation being levied on tho people. This money would be in reality "cheap money," as the Colony would not require to pay interest on| it, to the London "gold-bugs," and it would be issued to the people through the farmers, on the security Jfttheir lands, at two per cent., inflread of the bogus system which the Government have thrust on tbe people as a " cheap money " scheme, If oi'v farmers could get money at two per cent,, and enough of it, there would be precious little of" hard times" left, Then you tell us" a State bank of issue is a fad and nothing more." It is such a good fad that tho only sound banking system the world has ever known was the State bank of Venice, which ran for six hundred years and never had a crisis in its history, till Napoleon pulled it to pieces, as the only means of destroying the commerce and power of Venice, and that is the, sort of" fad" we want in these times of bank crises, which havebrought ruination to thousands. Then I am surprised at a shrewd journalist like you writing of overproduction. Over-production means that products increase faster than population or consumers, What is tbe fact? Statistics show that

population and consumption increase five per cent more than production. /430w can there be over-production With so many people poorly housed, *adly fed, and badly clothed f That

over-prodnctioncryis the old trick of] Shylock to conceal the truth from the people while he is fleecing them. When you say "money was never so plentiful as now," you Bay what is to fact, aria if I were not

Bonsiblo - of the fact that I am trespassing too much on your kindness, lsliould place your contention beyond dispnto. I have just read alettorfromyour correspondent "Gold," Professor Perry, whom he quotes, I have nover heard of, although I have read up something of most authorities. Against this opinion, I will refer your correspondent to Professor F. A. Walker's work on "Money," which is by common consent, the ablest work 011 tho question, Your correspondent then quotes Bonanny Prico, but this quotation is in reference to such issues as tho American greenbacks, tho Argentine cedillas, and the French assignats, - very different systems from those advocated by money reformers now-a-days. Howoyer, here is what your correspondent's authority, Bonanny Price, says on this point: —"Experience has proved that it (inconvertible paper money) need not suffer any depreciation in value The public has a certain definite want for notes to use in the daily operations of buying and selling. . . . Payer money has a further mperiori'jj of great im-1 portaxce over specie; its comparative cheapness, combined with equal efficiency." If the people of Masterton are anxious to hear more about the question, I shall be glad to yisit your town and giro a lecture, when "Gold" or any "Gold-bug" who thinks lie has a good case, may have the fullest opportunity of having it out with me,-lam, etc.,

E. A, HxfiflES, Woodvillc, April 24th, 1895.