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Sir,—The Hongkong Bank is merely a Commercial Depth from which many of the great Mercantile Firms direct and settle trade operations recurring on the mainland of China.
The power of the local Government here can only extend to transactions in Coin actually occurring in the narrow limits of a small Island, whereas the vast extent of our Indian Empire ensures an immense circulation of any coin declared by the Indian Government to be legal tender.
That consideration alone is so vast and important an element in the discussion as to preclude all fair comparison between the probable success of minting operations here and at Calcutta.
If the Dollars of the Colony,—without any greater purchasing power than the Dollars of Mexico in circulation on the Coast,—cost the Merchants 2⅒ per cent more than the others, the merchants would naturally endeavour at Canton or elsewhere to make purchases requiring cash payments to avoid a heavy charge of 2⅒ per cent—a very important item in a large operation.—I should therefore be unwilling to proclaim the Hongkong Dollar as the only legal tender, unless I were certain either that it was taken at a premium or that Silver could be imported at a reduction of at least 2 per cent on the