Borrowing and business in Australia

Bibliographic data

Monograph

Identifikator:: 183051623X

URN:: urn:nbn:de:zbw-retromon-222122

Document type:: Monograph

Author:: Wood, Gordon L. http://d-nb.info/gnd/1239193688

Title:: Borrowing and business in Australia

Place of publication:: London

Publisher:: Oxford university press, H. Milford

Year of publication:: 1930

Scope:: xv, 267 Seiten; graph. Darst.

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Part IV. The commonwealth, 1900-14

Collection:: Economics Books

114 THE COMMONWEALTH, 1900-14 made wide swings which had very marked effects on Australian prosperity. Between 1846 and 1871, to review the fluctuations briefly, prices had risen by 28 per cent. ; but the cheapening of ocean transport towards the end of this period assisted a de- finite downward swing which, by 1896, marked a decline of about 30 per cent. below the 1871 level. After this a steady upward movement developed which by the year 1912, as estimated by the Economist, represented an increase of about 34 per cent. upon the 1896 level. The search for reasons for this increase hardly lies within our province; but it is undoubtedly connected with the expansion of credit and enlargement of currency made possible by the great increase in world gold production. Unalloyed prosperity marked the whole of 1910 as the ex- pansive government programmes, based chiefly upon swell- ing customs revenue, the large capital borrowings, and in- creased productivity consequent upon bountiful seasons, took effect in industrial activity and increased purchasing power. By the middle of 1911, however, the critics were again stressing the dangers inherent in the business situation, and the possibi- lity of a sudden check being experienced. Extravagant public and private expenditure, the stimulation of city industries and the resultant rural depopulation, an indulgent bank policy, and the machinations of company promoters were all castigated. In that year, also, several remarkable developments tended to unsettle business and to promote uncertainty. Not the least of these was the establishment of the Commonwealth Bank and the passing of the Commonwealth Notes Act. While the Australian banking system was not greatly affected as the result of these changes, a great deal of uneasiness accompanied these adjustments. Rural industry was also much disturbed by the new Federal policy of ‘bursting up large estates’ by means of land taxation. While none of these innovations were revolu- tionary in themselves, the general suspicion which was en- gendered introduced an unfavourable factor at an inconvenient moment, since the export of specie was now exceeding the pro- duction and bank reserves were thus being depleted. The situa- tion held the germs of a contraction of credit which was to develop into something more serious. The cvele had, in fact, again come full circle. After years of

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