16845
29
PUBLIC RECORD OFFICE
Reference :-
TLC.O. 882
9
PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
SIR,
No. 39.
CROWN AGENTS to COLONIAL OFFICE.
(Received 31 May, 1910)
[Answbred by No. 42,]
Whitehall Gardens, London, SW, 30th May, 1910. In continuation of our letter of the 27th instant, I have the honour to inform you that on the 26th instant we telegraphed to the Government of the Straits Settle- ments as follows:---
'Secretary of State for the Colonies has approved of our carrying out arrangements proposed in paragraph No. 5 Governor's confidential despatch January 27th.f How are we to deal with proceeds of sale of 4,000,000 dollars now being made ?'';
and on the 28th instant we received the following reply
2
"In answer to your telegram, 26th May, 4,000,000 dollars authorised to he sold since April 1st should be dealt with as follows: Dollars 333,333 for investment for Gold Standard Reserve, balance for investment Note Guarantee Fund. With reference to January sales £243,576 18s. should be invested for Gold Standard Reserve.
13
The figures given in our letter of the 27th instant should, therefore, be modified to the extent that £29,570 16s. 5d. is now being dealt with as belonging to the Note Guarantee Fund (gold portion) while £243,576 18s. is being placed on deposit at interest on account of the Gold Standard Reserve pending the receipt of further instructions from the Secretary of State.
3. You will notice that, of the 4,000,000 dollars which are now in course of being sold, the telegram instructs us that 333,383 dollars are to be treated as be- longing to the Gold Standard Reserve and invested and that the balance, which will amount to a sum of nearly £300,000, is to be invested on account of the Note Guarantee Fund.
4. The first instalment of 1,000,000 dollars arrived on Saturday, so that we should be glad to know as soon as possible if the Secretary of State approves of our carrying out the instructions given to us in the telegram.
16294
No. 40.
I have, &c.,
R. L. ANTROBUS.
THE SECRETARY OF STATE to THE GOVERNOR. (Sent 12.30 p.m., 2 June, 1910.)
TELEGRAM.
[Answered by No. 41.]
Referring to your telegram to Crown Agents, 28 May, as to sale of four million dollars now being made, should not Note Issue portion be dealt with as follows:- Half held in specie, half lent on short loan?-CREWE.
16845
No. 41.
THE GOVERNOR to THE SECRETARY OF STATE. (Received 8.30 a.m., 4th June, 1910.)
TELEGRAM.
Your telegram 2nd June.§ Proceeds of sale of 4,000,000 dollars should be one-half permanently invested, one-half on short loan. No probability of early con- traction of circulation and investments now very much below limit.-ANDERSON.
• No. 38.
↑ No. 33.
† See No. 39.
§ No. 10.
No. 42.
COLONIAL OFFICE to CROWN AGENTS.
GENTLEMEN,
Downing Street, 8 June, 1910. I AM directed by the Earl of Crewe to acknowledge the receipt of your letters
of the 27th and 30th May* with regard to the question of investments on behalf of
the Government of the Straits Settlements, and to transmit to you the enclosed copy of telegraphic correspondence on the subject with Sir J. Anderson.
2. His Lordship now approves of your carrying out the Governor's wishes; and I am to add that all the Gold Standard Reserve moneys should be invested.
I am, &c.,
24396
No. 43.
G. V. FIDDES.
THE GOVERNOR to THE SECRETARY OF STATE. (Received 8 August, 1910.)
(Confidential.)
[See No. 54.]
MY LORD,
Government House, Singapore, 14 July, 1910. I HAVE had under my consideration your despatch of the 18th May for- warding correspondence with the Lords Commissioners of the Treasury on the sub- ject of the currency note issue of this Colony.
2. I am afraid that their Lordships are under some misapprehension as to
the actual conditions prevailing here in regard to our monetary circulation.
3. Since the time when the Government note issue was started it has been steadily displacing the silver dollar, a process which has been greatly accelerated by the issue of one dollar notes.
4. On the 31st of December, 1905, the value of the notes in circulation was $17,353,710, and of silver, $24,553,026.
5. On the 30th of June last the value of the notes in circulation amounted to $32,339,160, while the amount of silver in circulation was about 7 million dollars, or if half-dollars are included, which were not full legal tender in 1905 but are so now, about eight millions. The diminution in the aggregate circulation is due, of course, to the demonetization of our currency in Sumatra and the Siamese pro vinces of the Malay Peninsula, and partly to the complete divorce of our standard from silver, which was not finally accomplished till 1906.
6. We have in the vaults of the Currency Commissioners some four million dollars more than the total amount in circulation. The cash held by the banks is almost entirely in the form of notes.
7. I need not point out that the preference shown by the public for notes is not peculiar to this country, but is in accordance with universal experience. In Hong Kong, as your Lordship is aware, there has been for a long time a premium on notes. 8. Notes are not only more convenient, but are far less liable to be counter- feited than silver, and since the weight of our dollar was reduced, several attempts have been made by coiners to make dollars out of the old large dollars or British dollar, and these, being of the same weight and fineness as the Government coins. can only be detected by an expert.
9. The public are fully aware that the standard dollar is now only a promise to pay, like the note, and so long as the note is so much more convenient not only to handle, but also for purpose of remittances, for which it is largely used, "the preference for it must continue.
10. In the case of the Netherlands Indies, where the issue of legal tender notes is in the hands of the Java Bank, that institution is only required to retain one- fifth of its circulation in legal tender silver, and no inconvenience has resulted, as the public there show the same preference for notes as the public here.
11. The main objection to keeping so large a proportion of silver dollars in
‡ No. 36.
Nos. 38 and 39.
↑ Non. 40 and 41.