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OUR MELBOURNE LETTRER. ----------- ?THE SAVINGS BANKS. Mr Watt, the Premier, .will-mnot day definitely what proposals Mr Miller, manager of the Qommonwealth Bank, has made to him regarding a common working of the Commonwealth and States' Savings Banks. What he does say, however, is that he has not receded one whit from the position he first took up, Nor does he believe the other' States will. The ,only. State in which there would be likely to be the least sign of weakness is Western A?stralia, but even from the "Lone Star" State no sign of breaking away from the agreement come to at the Premiers' Conference has been mani fested. When spoken to the other day on the question of compromise Mr Watt first treated the matter jocosely ; then, growing stern and assuming his characteristic Napo leonic-like attitude, remarked that \while he was in office Mr Miller could spare himself the trouble of making any advances towards the Govern ment of Victoria.

STAT'E POLITICAL AFFlAIRS. As the session goes on, State poli tical affairs appear to grow more confused. When the trouble over the Country R?oads Bill was settled it Was hoped that the way had been cleared for the disposal of the mass of busi ness that remained idn the notice paper. Now one hears that instead of the trouble being confined to one chamber, it is-likely to spread over both the Upper and Lower Houses. For example, it is gossiped that there will be certain to be a conference of the managers of the two Houses over the Closer Settlement Bill, which was so materially altered by the Legisla tive,'Council that, according to one member of the Legislative Assembly, its "parents" would not be able to *recognise the measure when it was returned to them. Mr M'Kenzie, Minister for Lands, is very outspoken about one amendment. That is the abtolition, of the residence clause: Then, again, the Government is some what irate over the mangling ,the liMelbourne Harbor Trust .Bill,,, has been nsubjected to. All this you will realise' points to war, of which 'there have been niore than' rumiors of late. 'If a struggle should be precipita&td be 'twceri the' two Chambers, thent only the"legislative '"gods" knoi " hen the 'session will: close. :

CABINET. RECONSTRUCTION. One still 'hears it' gossiped :that .there is. to be State Cabinet recon struction,.if not diuring: the sitting of Parliament, then soon -after the rec cess is readhed. It is said, indeed. that it was the Government that made overtures to somemembers . of .the, Ministerial Corner, ,regarding the Country Roads Bill, and; further, .that if direct pronmises were not m~'ads to some members of that Corner'very signiff.cant hints were throin out that if their good offices wiere secured to. obtain a 'compromise they; iould not be forgotten when the time. for redistributing portfolios came round. All th s"may be the"merest flotsam and jetsam of Parliamentary life,'but at the same time: it may constitute the straws which' serve to show which war the wind blows. DIAMOND DISCOCVERIES. . It is many years ago since .diamonds were. first found at Bin gera, in New South Wales. Some thousands of pounds were spent by a st.ndicate in the endeavor to open up the field. No inconsiderable num ber of 'the precious stones were found. but they were too small to be of much commercial value. Now simi lar 'discoveries have been made at 'Delegate, where' the outlook is re ported to be much more promising. One ,or two rather fine stones have been brought to Melbourne; and have been been favorable. reported on by experts. One hears, too, that people who, know all about 'diamond mining are to be imported from South Africa to report, not onlv on the Delegate mine, but on Australian. fields gener ally. CHRISTMAS GIFTS. There has been- aduring' the last few years 'a marked change in' the charac ter' of Christmas gifts. The' old fashioned card, with its picture of snow-clad ],nglish scenery, .with .its lace edges, and its sentimental prose and poetry, has been superseded' by much more useful presents. This year these are to take the shape of at tractive, yet surprisingly cheap, edi tions of Dickens, Thackeray, Rudyard -Kipling, Rider Haggard, and others of the old and modern popular writers, both in prose and poetry. Here, .by the way, I am reminded of the .statement of the manager of. one of our largest bookselling establish ments 'that during, the past few weeks there has been an unexpected run on the Adam Lindsay Gordon's poems. Reproductions of the pic tures of some of the old masters, as also scores of the most modern operas are in demand as Christmas presents. For children of .a smaller growth the most popular toy is an ingenious miniature aeroplane that can be niade to travel across a good sised yard. In eual favor is a set of Kharki-clad cadets, instead of the old-time leaden soldiers. Our shop windows are beginning to pre sent a more than ordinarily attrac tive appearance. A GREEK PATRIOT. One of our wealthiest Greek cafe keepers is evidently,.of opinion that Adrianople must very soon fall, for he has already issued invitations to a banquet to celebrate the final triumph of the Balkan allies. It is promised that this banquet will "equal anything of the kind that nas ever been given in Melbourne ." This is a "pretty big order" when one re calls the many Lucullus-like "fedds" that have marked the history of the metropolis during even the last ten years. I hear that a large percen tage of our most prominent citizens have been invited to the function now under notice. THE CIGARETTE fIIABIT. It is not satisfactory to learn that the cigarette habit is amongst'" our youngsters more pronounced than ever. Do rapid has the growth of that habit been of late, that the "many millions" Sir George Reid de plored in the House of Representa tives some years ago must have been enormously increased per annum. You have only to walk along our princi' pal streets to find the channels thick ly strewn with cigarette butts. Then, again, if you are ever in Collins street at lunch hour,' between-1 and 2 p.m.- you will note that the great ma jorityV o the young e!ll!ow th·.seccn g ga- ate; ' w - cigasrette o! dun hind 'or tbi otbu: bttwien thaiu. a.' It -re that r.~ie-a 'ad .t4 o cf ur principal cIgarette man-,art'res .aro being largely expanded.