CO882-(6-8) — Page 112

PUBLIC RECORD OFFICE

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Reference:

C.O. 882

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE COPYRIGHT PHOTOGRAPH-NOT TO BE REPRODUCED PHOTOGRAPHIC-

34

MINUTES OF EVIDENCE:

Mr. B. M. the produce for gold, he would, of course, make profit Underdorm, during a certain time; that is so.

K.C.

1261. Your answer is that a man who took gold to that 9 Duc. 102. country might make a profit; but my question is, do you think that this fall in exchange is a good thing for that country, taking it as a whole, whose currency he fallen in value 7-No, I do not.

of

1262. Have you found, or have you not found, that the countries whose standard depreciated very much have progressed more rapidly than the countries that hal a gold standard ?—No, on the contrary, I have found business extremely interrupted. Take the case Havannah, for instance, where I have had a great number of years' experience. Very often the operationa are completely paralysed there, as they are rendered very difficult elsewhere.

1263. Have you found that the fluctuations in ex- hange in the Straits Settlements and the fall in ex- change lave interfered with your business?-I could hardly say that they had actually interfered with it, but they have rendered it, cf course, very much less profitable, and it has this effect, that we should be very unwilling to send large quantities of machinery and other things, which we have to pay for in gold, if the present uncertainty continues. We are at this moment in some considerable-I will not say difficulty, bat certainly inconvenience by the position in which we find ourselves. We are actually selling produce, or should be obliged to sell produce, at almost a loss.

1264. The sugar that you make in Province Wellesley, how is it disposed of; where do you sell it ?-It is prin- ripally sold to Chinese contractors in Penang itself, and they very often buy the whole crop at the beginning of the year. The delivery of that is made during the

year.

1265. And where is that sugar consumed-Princi- pally in China.

1266. So that you practically sold that sugar to countries that use the silver standard?-Yes, and natu- rally that regulates the price the contractor will give us for that sugar.

He buys it, as it were, for that market; for the Eastern market.

1267. Did the price of sugar measured in silver risa in proportion to the fall in exchange-There is a certain rise, but not to the full extent.

We are actually

at this moment bargaining and endeavouring to raise the price of sugar very largely indeed for the next crop, in order to cover our expenses.

1268. But you find, I understand, that the price of sugar masseured in silver has not risen quite in pro- portion the fall in oxchange?—No.

1269. I dare say you are aware that the price of sugar in gold has fallen very largely?—Yes.

1270. From reasons quite unconnected with the standard of value? Yes, I am largely interested in Cuba myself, although I do not make sugar in Cuba. I am chairman of the largest railway there; there- fore I know how we are interfered with by a similar tate of things existing there. Now, of course, as we know, the American dollar has been practically intro- duced into Cuba.

1271. And before the Americans expelled the Spaans the standard of Cuba was silver 1-Silver, Yes. Well, there were dealings in what was called gold dollars, Spanish gold; a very large amount of the business was done for what was called gold, which was Spanish gold.

1272. But a man is generally at liberty, even in a silver-using country, to make a contract in gold if he wishes to do so?-Certainly, and that was the general form as we know, a legal question in America arose upon that.

1273. And he would be able to do that unless such a thing was prohibited by some positive law?-Cer tainly.

1274. The fall in the value of silver compared with poli has been very grost-Enormous. I think ther re several returns that I have given.

1275. I have got them before me, but it will be suff. cient to say the price of silver in gold is not much more than one-third of what it used to be-That is no.

1276. Can you form any opinion as to whether the fall in silver has reached the bottom, or whether there is likely to be a further fall or a ree 7-I think I have ment oned that. I say that during the many years

I have been looking at this, one always had the

idea that the mining production was the main item to be considered as far as production is concerned, and that by and bye, when prices fell to a very low figure, probably the mines would be shut down, and the fall would be checked, but now we know (and I have dia cussed it with some of the largest people in London) that silver, being a bye-product, is thrown upon the market constantly; it must be thrown upon the market, and this has a tendency naturally to increase the fall in the value of silver.

1277. That is to say, if in any particular mine silver and copper were found in the same ore, the production of silver from that mine might continue, although its value in the market had fallen almost to nothing?- Certainly. If you take mines in Chili, for instance, many of the mines produce copper, others in Spain and elsewhere produce lead, but then the silver is carefully extracted, and every element sold constitutes a certain percentage of profit in the working of the mine.

1278. In any case, the mining might be carried on for the sake of the copper-Certainly.

1279. And what they could get for the silver would be so much additional profit? So much additional profit.

1280. Would you be in favour of the introduction of a gold standard into the Straits Settlements?—I should.

1281. Are you prepared to suggest any scheme by which this change might be carried out?-Well, I think that although there may be some palliative measures, in the end it will come to the fixing of some price for the dollar in the same mode as has been adopted in India Of course, the position has been affected by the difference of the price of silver elsewhere.

1282. Are you prepared to suggest details of a scheme by which the change could be carried out in practice? I should be rather unwilling to go so far as that, but if I mention a type, I think, after looking at it a great deal, I should be disposed to put the price at 2s. per dollar.

1283. That is the ratio you recommend ?-That is the ratio.

1284. But you do not wish, as I understand you now. to give ovdence as to the measures by which that rate might be made effective ?-No; I have referred to the adoption of a particular kind of coinage, and to the way in which I have seen things carried out elsewhere, principally by the adoption of what I have already men- tioned-gold contracts.

1285. Contracts made in gold?Contracts made in gold. The sterling contract is one in which you take the basis of the pound sterling; the gold contract is another. A gold contract in the Argentine or a gold contract in America is one where the basis of ex- change would be the gold dollar; although, in fact, in the Argentine you would have some difficulty in finding the particular piece of coin called the gold dollar.

1286. The sterling contracts and gold contracts would be very much the same 7-They would be very much the same, but there is a slight difference.

1287. There is a slight difference, varying from time to time, but if that was the remedy there is no reason why the people in the Straits Settlements should not of their own motion adopt that remedy at once?-No reason at all, that I can see, and that would be one measure which I have described as an immediate pallia tive without going to more heroic measures.

1288. That is a matter which is within the power of people, those who have business to do there -There is only one variety of it which I was thinking of, it is this: when you make a contract with exchange as it is at the date of the contract, there is no reason why it should not be made for currency or any other form of coin, if you please, fixed at the price of the day on which you make the contract. Now the contract of sale is made subject to payment being made at the exchange of the date of payment. The adoption of what I mention would shift the risk, so to speak, from the one shoulder to another.

1289. But that method of getting over the difficulty by means of gold contracts or sterling contracts would not be found practicable, I should say, in the case of small transactions --No. Could you not then adopt the

question of a limitation of the amount of legal tender. that is to say, make silver or currency, or whatever you please to call it, good tender only up to a certain point, as we have it in this country.

COMMITTEE ON STRAITS BETTLEMENTS CURRENCY.

1290. In this country?-That might also have some checking effect, but I have no practical experience myself in conducting national affairs, only from the point of an observer,

1291. But the essential point on which you give evidence is that you are in favour of the establishment of a gold standard in the Straits Settlements?—I am, 300.

1292. And the details of the method of establishing that standard I understand you to leave to experts! For experts, certainly. I should hesitate to put for ward any scheme.

1293. You have put in a memorandum in which your views are stated fully --Somewhat roughly, I am afraid; & good deal may be surplus, sufficiently well known, but I thought it well to say so.

1294. You are willing that this should be taken as a portion of your evidence-Certainly.

1295. You were going to refer to one of these tables ↑ -That was one I had not put in, but I do not know that it has very much interest. No; I think those would be sufficient,

1296. Well, I would like to ask you one question about prices: is it the case that the wages of labour have risen in the Straits Settlements ?-Certainly, very much, and I have a short statement here about that.

1297. Take this for example: I find you say that in 1889 the free labourer, whom I suppose you mean the Indian coolie, the free Indian coolie -The free Indian coolie is a man that we employ, of course, in the Straits, who has either completed his indenture with us or has been employed previously by other people.

1298. I quite understand what you mean, the free Indian coolie is the man who is not under an in- denture; you say that in 1889 his wages were 20 cents a day, in 1891 21 or 22 rente? That is so.

1299. In 1892 they were 35 cents to 45 cents?—Yes, and our manager had been dealing with the Governor. He (the Governor) wished to raise the general price to 28 cents per day from what was the prevailing rate; that is as to the indentured coolie.

1300. Is there anything else you would like to add to what you have already stated, and to what is written in this memorandum ?-There is only that table which is not applicable to this, the Chilian rates. As I have said, I am chairman of a railway in Chili, which works in connection with the largest silver mine in the world, I suppose, and when I first became chairman of that you will see what the figure was and what it is now.

35

Mr. E. M. Undardowan

I.C.

M

9 Dec. 1908.

1301. That is the exchange with Chili, is it?-With Ohili.

1302. I do not know that we need take evidence as to that.

1303. (Mr. Adamson.) You have got a statement, i think, there of the wages. Have you a statement also of the price of sugar at these different dates —No, I have not got that with me, but no doubt we could get it. 1304. I think we may take it that the Penang Sugar Estates have been particularly profitable of late years? -Well, I should not like to boast very much; they have done a great deal better for many years, and we have begun to get rid of the enormous losses which were sustained before for a great number of years upon it. 1305. I think I can give you the dollar price of angar. I can get that for the Committee, and we have got the price of wages, so that we will be able to make a com- parison. You are aware that Java is a very rich country, and grows a great deal of sugar t—I am.

1306. And you are aware probably that at the pre- sent time Java, which has a fixed exchange, is doing ancommonly badly in its sugar industry 1-Very likely. I do not believe in the Dutch. I have had a great deal to do with them.

1307. So that if under free silver, with no better soil, you are doing uncommonly well, and in Java, 700 miles to the south, with a fixed exchange, they are doing uncommonly badly, what is the reason? There may be many other reasons which I could very likely point out if it were necessary to do so. Surely the system altogether in Dutch colonies in so absolutely different from anything that we have that it is very difficult to draw any conclusion whatever. There practically slavery existe. One would hardly like to go into all that, but I have no doubt myself that the reasons are different from those which affect the state of things which we are now considering.

1308. (hairman. I have no more questions to ask von is there any other remark you would like to make on the subject -No, I do not think so. I have not heard any of the other evidence.

1309. Well, there is nothing that occurs to me to ask you. I think we have got your views fairly enough, and you will get a proof of your papers and a proof of the report of your evidence If you please.

(Chairman.) We are much obliged to you for taking the trouble to come.

FIFTH DAY.

Tuesday, 16th December 1902.

PRESENT:

Sir DAVID BARBOUR, KICK.L, K.C.M.a. (Chairman), presiding,

Mr. W. ADAMSON, C.M.tè. Mr. G. W. JOHNSON.

Mr W. BLAIN.

Mr. A. E. COLLINS, Secretary.

Mr. J. A. PIXLEY, called; and Examined. 1310. (Chairman.) You are a member of the firm of Mooers. Pixley and Abell, in the Oity 7-Yes, I am, sir.

1311. What is the nature of the business of that firm? -Our business is dealing in gold and silver, both in bare and in coin, i.e., bullion and specie.

1312. And from the nature of your business you have no doubt had your attention directed to the continuous falt in the value of silver compared with gold-Yes, sir. I regret to say we do the same work now, or rather double work for the same brokerage. We always get paid on the sterling value, and, of course, owing to the fall double the quantity of silver is now handled for the same sterling since I have been in the City.

6489.

Mr

1313. And, compared with the old price, almost three times-And compared with the old price almost J. A Pixley. exactly three times.

1314. Not quite Well, very nearly, taking the price 18 Dec. 1902. at 62d.

1315. Have you paid any attention to the production of silver from year to year?-Yes, we watch the statistica, of course, very closely. We are mainly dependent on the United States' figures; but we watch these very closely, and we check them so far sa we We have found no reason to doubt the accuracy of the United States' figures. It is the only country that goes into it at all systematically.

con.

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