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price received from the sale of subsi-
diary obins, after payment of expenses
of the note issue, would be invested by
the Crown Agents in London, part of it
possily in silver securities, if suit-
able silver securities can be found.
Pro-
fits on investments would be added to the
investment portion of the Note Cuarentee
fund.
10.
The Government should also sell
from time to time the stock of subsidiary
silver coin which they accumulate from
Myments mad by the public. They should
blen mub notes into circul ion equal to
the value of the subsidiary coin, sinus
A
She current depreciation of that coin
(which loss should be met from Revenue),
and buck the notes to the extent of two-
thirds with standard dollers received
from the scle of the subsidiary coin as
bullion. The revsinder of what they
Inceive from the acle of the subsidiary
coin should be invested as above,
DRAFT.
/
13.
In course of time, when the
success of the Government Note Issue is
assured, the specie reserve beld in
standard dollars could be
reduced to on:
half, and the investments increased ac-
cordingly, so as to hasten the complete
covering of the issue by security in cash
or investments. This will be the more
desirable as it may be anticipated that,
as the operation progresses, the discount
on the subsidiary coin will diminish and
the Goverment will therefore have to pay
higher price to the Barke for them.
14. When the subsidiary coins rise
to par the issue of Govermaent notes will
be discontinued. If it falls pin, the
issue of notes can be resumed. The To-
cess of reducing the redundancy of the
supply of subsidiary coin ri'l therefore
Largsty
be automatic.
15.
There can be little doubt
that after the scheme is introduced dere
will soon be a marked difference between
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