Extract from a letter from Mr. Caine to Mr. Clauson
dated 21st September, 1938.
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Part of my reason for replying so quickly is to
ask you two questions, one trivial, the other not so
trivial.
First, after experiencing the inconveniences of
drawing up Estimates in the middle of the hot weather,
which is also the height of the leave season, I suggested
changing the financial year to 31st March. (It wouldn't
help me, because no change could be effective till the
1941 Ests. but it would be a bequest to my successor).
N. L. was enthusiastic, H.E. lukewarm and he asked me to
find out privately if the C.0. would have any views.
Taking Hong Kong conditions by themselves I am sure it
would be right; but it might be regarded as introducing
further unnecessary diversity into Colonial statistics.
Let me know what you think; if the C.0. is neutral I will
pursue it further, if you dislike it, I shall drop it
entirely.
Secondly, what do you think of the prospects of
our tapping the Exchange Fund in a year or two if currency
conditions remain as at present? You know the facts –
present surplus about $20,000,000, income about $5,000,000
p.a.; the "risk" is appreciation of the dollar which is
not exactly likely. I occasionally remind the Advisory
Committee that we might go up as well as down; last time
I suggested it they said "over our dead bodies". (The
fact is thay are all enormously overbought; which is
worth bearing in mind if we ever do have to take their
advice about revaluation).