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be no guarantee that the Canton mint would refrain from more Subsidiary coinage, with the result that Hongkong coins being used as a reserve currency by Chinese criminals while the subject is treated as a debased coinage, in which case the Hongkong coinage may disappear (being melted down to make the new coins) but out of the extent of withdrawal it is selling at a bullion value.
£ trade would be disastrous but would be ameliorated by the withdrawal of Hongkong coins. Of course withdrawal suffered than cancelled but a benefit the Revenue by debilitating British currency that benefit would be more by the cost of withdrawal) and not, as it seems & now, benefit the trade of Hongkong which must be conducted largely in the medium of Chinese currency & subject to an equal, & probably a greater, discount in the direction of withdrawal: hence therefore until it is known that the Chinese will take withdrawing this matter, any action by Hongkong British Coins from circulation would be premature, & once misplaced.
What the cost of loss without any corresponding gain were to I have no data for calculation. I may differently estimate it $40,000. I turned have thought it much more. The face value of the subsidiary coins is I understand about the selling value as £360,000 p.a. less than that bullion value of course also upon the weight of the coins in relation to their face value & not merely on the proportion of alloy) & upon the price of silver at the time.
Transport, insurance & Agents' charges have to be added. Say my loss to the Bank "something under $3000 is not worth it was loss very serious matter."
The Alternative is to continue the present system. This costs (say £3600 p.a.) I broadly think & me it advisable to accept it for the drawbacks unless some cooperation from China in any reform can be obtained. Without that I think it is a grave part of the Chinese currency:- "the part of Hongkong would be to sink without a hallmark. 'Hongkong for currency is sure at 97.66. this is key to conical & 11½ %.
6.6.07.
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