582
TRANSLATION.
Currency Question.
CELA FER
581
593
It would be foolish for Hongkong to adopt a gold standard for these reasons:-
1.
If a gold standard is adopted, merchants in Eongkong will be placed in difficulties and traders in China will suffer from the fluctuating exchange. The majority of Chinese merchants do not therefore wish for a gold standard.
2.
Though Hongkong, as compared with gold countries, would have a fixed exchange (in the event of a gold standard being adopted) the exchange between Hongkong and Canton would vary from day to day. All the banks would therefore establish themselves at Canton, in which case the Canton banks would occupy the place now held by the Hongkong banks. The gold standard would mean a constant variation in exchange and the Hongkong rates would depend on Canton.
3. If all the banks move to Canton, Hongkong business will be slack. If business is slack, the people will have the Colony and therefore property will decrease in value and interest dėminish.
4. A gold standard in Hongkong will be profitable in the case of exports from China, because of the gain on exchange. But imports only pass through Eongkong for distribution in the interior. The demand in Eongkong 13 very small: the demand in the interior is very great. If the price of gold in Canton is high, these goods will remain in Hongkong and will not be distributed inland Hongkong business will fall off from day to day and in proportion Canton business will increase. The prosperity of Hongkong will therefore be gone.
5.
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A
Silver countries are few: gold countries are numerous. fall in the price of silver raises the cost of exports. Arise