Finance—Public & Private
- The First Bank Meeting
TEE favourable impression which was created by the maintenance of the dividend declared by Barclays Bank and the subsequent soundness of the balance-sheet will be confirmed by the character of the chairinan's speech at the annual meeting, held last Thursday. For there were two main features of Mr. Goodenough's address—the text of which will be found on another page—which may well inspire confidence in the conduct of the Bank's affairs. The first of these was the care taken by the chairman of the Bank to give shareholders the fullest explanation of the balance sheet itself, and the other was the manner in which Mr. Goodenough, ignoring minor aspects of the world crisis, fastened upon the outstanding factor.
A STRONG POSITION.
With regard to the affairs of the Bank Mr. Goodenough emphasized the point already revealed in the Report, namely, that in spite of the many difficulties of the past year the directors have been able to make an addition of £200,000 to the contingency account while at the same time maintaining the dividend. Moreover, he was also able to show that all bad debts had been written off either out of profits made during the year or out of profits which had been set aside in previous years to provide for debts which now have to be dealt with. In addition, all debts now considered to be doubtful have been amply provided for. Nor did the chairman ignore the special situation created by German debts on bills. He gave shareholders the fullest information on the matter and showed that the special reserves of the Bank were sufficient to meet all possible contingencies even in that connexion.
GOLD HOARDING.
With regard to the great problem of Reparations and war debts, Mr. Goodenough referred in hopeful terms to the indications of a great desire on the part of the American and French Governments to endeavour to solve the problems so as to meet the situation " and to help to restore the world as a whole to a sound economic basis." I am glad, however, to note that Mr. Goodenough pre- ferred to deal with a broad principle which, in its way, must be regarded as of even greater importance than the mere book settlement of international debts, namely, the necessity for removing, as far as possible, all impediments to a settlement of international indebtedness through the medium of an exchange of goods and services. The Tariff barriers between the various countries, and especially, of course (in regard to the position of the debtor countries), the United States tariff have played as great a part in bringing about the fall in com- modity prices and the world depression as the inter- national debts themselves. Moreover, the situation has been made worse by the fact that not only has there been insistence upon the part of America and France for pay- ment or in ebtedness in gold instead of goods, but in addition the situation has been aggravated because the gold received has not been allowed to function in normal fashion. The method of making payment in gold instead of an adequate export of goods and services by debtor countries, has, said Mr. Goodenough, " become virtually impossible owing to a very large amount of the available stocks of monetary gold being now concentrated in the heads of the United States and France. In. these two countries the heavy surplus stocks of gold are largely deprived of their earning capacity, and the Budgets in both eases will close this year with substantial deficits. Unless some means can be found for gold to be circulated more freely it would seem that gold will no longer be capable of being put to its normal use as a basis of currency and credit and as a measurement of world prices."
GaouNns FOR HOPEFULNESS.
While fully recognizing the necessity for a substitution of the policy of encouraging the exchange of goods for goods between the various nations for one of Tariff barriers, and while also recognizing that the ties of Empire could be strengthened by the granting of some preference in certain articles, Mr. Goodenough emphasized the fact that in the past this country has
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Finance—Public and Private
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set:a fine example not only in accepting goods and services from abroad in settlement of debts due to us, but also in readiness to advance out of surplus savings capital required by other countries to develop their resources and activities. Given a changed policy on the part of many countries with regard to tariffs and a greater readiness on the part of those countries which have accumulated gold to excess to lend abroad, and given -also a broad-minded view of the whole question of War Debts and Reparations, I -agree with Mr. Goodenough that the principal causes of the present depression will have been removed and that we Can look forward to a period of increasing prosperity. Tfie Meeting. of Barclays. Bank was the first of the series of-annual bank meetings, and the chairman can be con- gratulated upon having given an excellent lead in his treatment of the world crisis from the banker's standpoint.
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