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just should not be allowed to exceed the equivalent of the cost of minting (including seigniorage) and bringing to the Colony
British silver dollars from English bar silver.
If it does not suit the Banks issuing notes to provide
additional currency within this limit of premium it would then
be open to other institutions to effect the minting and import
of currency, and the upper bullion point would be established at
approximately double the limit of premium fixed by Government
because other institutions in importing currency would have to
bear the costs thereof and in addition the market rate ofdiscount
(within the limit we suggest) on the coins when they arrive.
J
It is therefore submitted that in order to correct the
fault above described it should be laid down by Government.
That the limit of discount at which Banks must receive
British dollars in exchange for their notes shall not be greater
than the limit to be fixed by the Governor from time to time and
published in the Gazette, (six weeks notice of changes should be
given). The limit of discount to be fixed by the Governor to be the equivalent of the estimated cost of minting and bringing to Hong Kong British dollars from English bar silver.
(Figures are appended which show this limit to be now 31%)