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 III. The boom of 1890 and its economic consequences

Collection:: Economics Books

THE PRELUDE TO THE COLLAPSE OF 1893 59 stocks, and this served as an encouragement to a willing govern- ment to enter upon an extensive borrowing programme. An early period of speculation in pastoral properties, which came to a timely end through drought, merely served, as it did in Sydney, to divert the current of speculation towards city properties. In addition to the annual loans floated by the government, Queensland, in common with the other states, attracted a large share of British capital through the agency of the banks. Speculation and drought early in the decade had, however, lowered the tone of business; and, in the crippled state of the pastoral industries, this acted to depress all business activities. Unemployment and distress impelled the government to relieve the situation by a big programme of public works estimated to cost no less than ten millions. This pious intention was helped in a dramatic manner and from an unexpected quarter. In December 1884 the wonderful gold deposits at Mount Morgan were discovered; and the splendid returns at once stimulated renewed speculation in mines. In Brisbane the marvellous dividends from Mount Morgan, the habitual loan, and the swell- ing flood of British deposits drove town values to crazy heights. Yet all the time the spectre of drought stalked through the country. At this time, in spite of the fact that overdrafts to pastoralists had practically ceased, bank advances had reached 114 millions in Queensland, an increase of over two million pounds in a single year. The splendid seasons of 1887 and 1888 effectually scotched any pessimism which the expansive policy of the government and the progress of speculation may have excited in cautious minds. The burden of the public debt had reached a total of 26 millions, or more than £78 per head of population, a situation which moved the financial editor of the London Times to vigorous and scathing criticism. But this had no effect, since the eyes of that section of the public who were not preoccupied with land transactions were filled with gold dust. In stark contrast industry and trade were stagnant, railways were becoming less and less of the nature of reproductive works, the public debt was still mounting, the return for capital expendi- 1 £50,000 was paid at this time for 50 feet of city frontage in Brisbane, and in the suburbs prices just as ridiculous were obtained.

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