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4. Lord CARNARVON understands that, in the present circumstances of the Colonial Currency, their Lordships, while retaining their opinion that the issue was unadvisable, will not insist on the withdrawal of the notes already placed in circulation, and that, with the information before them, they would disapprove any extension of the permission, but Lord CARNARVON would be glad to have their Lordships' concurrence in the instructions to be sent to the Governor on this subject, and I am accordingly to forward a draft of the despatch which His Lord- ship proposes to address to Sir A. KENNEDY.
The Secretary to the Treasury.
I am, &c.,
R. H. MEADE.
(5.)
The Officer Administering the Government to the Earl of Carnarvon.
MY LORD,
GOVERNMENT HOUSE, HONGKONG, 10th June, 1875.
I have the honour to acknowledge the receipt of Your Lordship's despatch of the 31st of March, covering copies of the correspondence which had passed between the Colonial Department and the Treasury relative to the issue of One Dollar Notes by the Hongkong and Shanghai Banking Corporation, and giving instructions relative to the restriction of any further issue beyond the amount already in
circulation.
In accordance with these instructions I have caused it to be notified to the
Corporation that they are not at liberty to issue any more notes of One Dollar in excess of the present circulation of $226,000.
In respect to the enquiry made by Your Lordship relative to the classes of the population amongst whom the One Dollar Note is circulated, and the result of the experiment as far as it has gone, I can do no better than enclose a copy of the report made by Her Majesty's Consul at Canton, in which he maintains with much truth that the issue of these dollar notes supplied a want which had previously been much felt and has been a boon to the public in China, and a still greater benefit to trade, that their withdrawal would cause great inconvenience to Foreigners and Chinese, that trade is facilitated by the speedy circulation of bullion or its representative in a portable shape, that the diffusion of trade among the many in preference to a few capitalists is the true commercial policy, and that this should be fostered by a low and portable measure of value such as the Dollar Note.