khand trying experient experimen to which
is not seem cabulated Apother any Tasting sffect.
Telyraph
poporal
83
Profit on subsidiary
the redemption of the overvalued coin,
coin is usually taken for current revenue, and where the
Refret cannot effear
issuing State has control over the currency throughout the
area to which the subsidiary coin is naturally limited, tue
danger is small. But in this case were supplying it for
we
confirm deep.
Su also 4764.
Mr. Fiddes
HT. Etados 8/3
Sir F. Eopwood
Enormou
JR/3
This matter is in a see hopeless tangl
normous massgof H.K. subsidiary coins have
a foreign country. A portion at any rate of the profits
should have been held in reserve.
Now we
bro blam
have to grapple with t nis doquing at a time when
H. Kong is in serious financial difficulties.
that all we can do is to do nothing !
And I am afaid
The best judges consider that we cannot keep Chinese
subsidiary coin out of H.Kong. Even if we could, it would ba
A
say
been supplied in past years and have
found the ir
way to China. The Chinese have now discovered that
40,000, worth.
undesirable to attempt it. Even if we dia,
and succeeded, we
could do nothing for our H.. coins, because with every
operation to raise their value, wo should have floons of our
own coin coming home from China, being replaced by the
cheaper Chinese coins.
they can make a nice profit by coining dollars
900 fine into subsidiary coins 800 fine. and
they are turning them out as fast as they can. This
desp. very lucidly explains the resulting situa-
tion.
in
There has been a deplorable lack of foresight
on the part of our remote predecessors here
allowing the coinage of H.K. subsidiary coin ad
lib. and taking the profit for current revenue,
without making any provision of a reserve fund for
(1390). Wt. o (12,528).,, 11,407—17.
7/09.
I do not believe a bit in Sir F.Lugard's scheme. It would cost a lot of money, which we cannot afford, and it would be
If we could establish a considerable margin between the
futile.
value of our own,
Chinese,
and of the whinese, coins, the latter
would drive the former cut of circulation,
and all our coins
in China would be attracted to the Colony. Of course
the Banks would like it. They would mais a pretty profit.
The situation may be summed up thus. Until we can shut out
the Chinese coins (which is not recommended ) nothing can