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

AUSTRALIA PRIOR TO 1893 77 in the ratio between reserves and deposits of the banks. The decline from 34 to 19 per cent. over the whole period, a shrinkage of 45 per cent. in the margin of safety, is too significant to be misunderstood ; and the drain of gold for export to restore the equilibrium of the exchange retarded the recovery towards the end. The connexion between borrowings and bank credit, and, hence, the decline in prosperity, may be regarded as conclusively demonstrated. To revert to the main topic again, it now becomes necessary to examine a little more closely the extent of Great Britain’s financial interest in Australia as represented by public and Private securities.! In 1887 the Economist published an esti- mate of Australia’s indebtedness to Britain at that date, and of the increase in the debt since 1883. This covers almost exactly the period of greatest loan activity, and the statistics covering both public and private debt are shown in concise form in the following table. Tae IX British Investments in Australia {In Millions Sterling) Victoria . . New South Wales South Australia . Queensland “ Tasmania . ” Western Aunstralia ToTAL . 1883. | 1887. £ £ 50 87 48 kd 22 30 23 36 6-3 & 1:5 : 160-8 29°. INOREASE. Total. Per cent. £ 17 29 R 34 60-4 36 56 60 [0 47-6 It will be seen that, during the five years, the burden of indebted- ness had increased by approximately 50 per cent.; and it is also of interest to note that, during this period in which Britain ! Hobson, Export of Capital, p. 42. ‘About 1874 a series of defaults in foreign countries made intra-imperial investments appear much more attractive. About that time & number of American railroads defaulted’ (for about £40 millions). ‘This, and the fact that the prevailing price of wool made the future of the pastoral industry seem full of promise, turned the flow of capital in this direction.’ — Harris, op. cit., p. 6.

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