CO882-(6-8) — Page 113

سائسسا

PUBLIC RECORD OFFICE

Reference :-

C.O. 882

7PUBLIC RECORD OFFICE, LONDON

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

Mr.

36

MINUTES OF EVIDENCE :

1316. And silver is produced chiefly in the United J. A. Pisley. States, in Mexico, an in Australia 7-Yes, you may say one-third of the world's product comes from Mexico, 16 Doc. 1992. one-third of the world's product comes from the United States, and the other third of the world's product comes from all the other countries, including Australia. In these other countries you have also got to reckon in Chili and Peru and British Columbia.

1317. And some is produced in the Continent of Europe, is there not —Some from Germany, some from Italy, a certain amount from Belgium and Russia. The Russian figures we are not able to gauge.

1318. There has not been, I think, in very recent years any falling off in the production of silver —No, on the contrary, a steady increase. Of course, the figures for 1901, the reliable figures, have not yet been received. I can give you my reason for thinking they will show a falling off for 1901. The only reliable figures that we have got are for 1900, and these show an increase over the previous year. I have brought

a copy of the latest United States Mint Report for the year, that gives you the figures for 1900; and the world's production in ounces, which I find is the best way of taking it, is 172,838,000 ounces altogether.

1319. Altogether 7-Altogether, and, as I say, one. third, or 55,000,000 ounces, comes from Mexico, one- third, or 55,000,000 ounces, comes from the United States.

1320. Now it has been said that the fall in the price does not at all affect the rate of production, because silver is very largely a by e-product. Do you know how far that is the case?-To a large extent it is true, sir. Where it comes out with lead, for instance. The Broken Hill Proprietary Mine is the leading instance that we have knowledge of. There silver is a bye-product with lead, and they published a statement in one or their reports, showing that when lead was £18 a ton they could produce silver gre, to sell at a profit even if silver were 15. an ounce. But then, of course. those figures are no good now,' because lead has fallen from £18 a ton to £10. Yesterday, I believe, it was a little better; it was £11 a ton; but you have got a substantial falling off, and it would be necessay to sell the silver at a proportionately higher price to obtain the same profit.

1321. Quite 80; and are there a large number of mines where silver is the main product-Not very many,

Where silver is the main product I would say it had long ceased to pay. It is found with other metals besides lead. I was only taking the case of lead as 1 knew about it. It comes out with copper and gold to a certain extent, and with zinc. So long as it pays to work the mine for copper, silver might fall to almost vanishing point before it would prevent them working it. But, in the case of lead, with the fall in the price of lead, they are getting down to a point where the profit is doubtful. I saw some figures published by a smelting company the other day that corroborate my point, and showed they are no longer working at a profit owing to the falling off in the price of lend and silver.

1322. They are working a rather poor ore ?-They are working all kinds of ore; but I was taking it particularly where silver forms a large portion of the ore which is treated. According to the figues just published they show no profit.

1323. Then what would be your opinion as to the future price of silver, if you are able to form any?-t is a very difficult question, sir; so much depends on the amount which is going to be used in coinage all over the world. Taking it that existing consumers will continue to use silver; but, on the other hand, that no other country will come on the market to coin, I should, before expressing an opinion, like to see the year 1903 at an end for this reason. The U.S.A., which is a gold using country, is also the biggest silver using country. The United States' figures are unreliable at present. because, owing to the Sherman Act, in 1890, they bought a large amount of bar silver which was stored away in the Treasury vaults. For the last ten years they have been using that up, and according to the figures which I have got from their report, and those figures are substantiated by a conversation which I have had with a leading firm, a smelting company in New York, they will by the end of this year have absorbed their stork of bullion altogether.

1324. User it up in coining subsidiary coinage?- Used it up in raining subsidiary coinage and in coining

dollars, but particularly in subsidiary coinage, because the dollar is not a very favourite coin in America.

1325. That is to say, the silver dollar does not circulate, as a rule, in America -Oh, no, I mean it is an inconvenient coin; anybody who has travelled in America in very glad to get rid of them.

1326. Do they not issue silver certificates against them 7-Yen.

1327. Of course, if they are in the habit of issuing silver certificates against these silver dollars, the fact that they had used up their bar silver would not make any difference, because they would not think it neces sary to buy more silver in order to coin full legal tender dollars ?—Not as long as they could keep their dollars in stock, but they would have to provide for the circula- tion both of dollara and subsidiary coin.

1328. They would have to buy for the subsidiary coinage -They would have to buy for the subsidiary, and the subsidiary coinage is a very large item. There is one further point before you go from that. They have got to provide for the Philippines. Undoubtedly they will try to make the American dollar currency there. It is proposed to put the Philippines on to a gold basis. That is hung up for the time being.

1329. Whether the Philippines go on a gold basis of not, that would not materially reduce the demand for silver --I would not say that, because the existing coins will have to be displaced. What I mean is, there would be a larger outlet for American coins in any event.

1330. Yes; but if they send these coins from America, assuming they are in circulation in America now, they would probably have to replace them with other coins i -The American Government would.

1331. Yes? They would, of course.

1332. Why not replace them with gold?-They might replace them with gold, but my idea. from what I have heard from the views expressed by the Secretary to the Treasury, Mr. Shaw, is that they will require more silver.

1533. That is the general conclusion you have come to 7-That is the general conclusion I have come to from what I have heard. That is one big factor, but as I say, if you go and take the figures showing the world's pro- duction and the world's consumption I should like to see what happens during 1903 before I say how far the production is overlapping the consumption. Other. wise, to answer the question you asked me, sir, taking the general position undoubtedly there is an over. production.

1334. I gather from your evidence that you are rather disposed to think that there may not be for some time that, sir, yes, on the general grounds that it will not any great further fall in silver-I am disposed to think

pay to produce more.

1335. There is a large demand for silver for other pur- poses than coinage 7-Yes; the industrial consumption

is enormous.

1336. The industrial consumption in this country and in the United States, is it increasing? Oh, yes, largely, sir.

1337. Largely since the fall in the price of silver?- Largely since the fall in the price of silver, and I think, froni conversations I have hal with the big Birminghani consumers, who, of course, feed the retail trade, that it will go on increasing, and silver will take the place largely of electro plate. The figures-I was working at these figures the other day-I estimate the industrial consumption to be on-fourth of the production.

1338. I suppose the price now of silver plate, unless it was very elaborately worked, would not be much more than half what it used to be-It ought not to be; un- doubtedly the profits male in the silversmiths' trade are very large.

1339. Very large 7—And they have not reduced their prices proportionately to the fall in silver.

1340. Is there anything else you would like to add now. to what you have said -No, I do not think so, mr. I do not know if it would interest you at all.

I just roughly calculated what we could look upon as the genuine consumption of silver, and it shows roughly where the production of silver overlaps consumption. I take the figures of 172,838,000 ouncer fine, as the world's production, and I find industrial consumption comes to 41,000,000 ounces. And then the world's coinage, eliminating Siam, which, as you know, has gone on a gold basis, and eliminating Mexico, because,

COMMITTEE ON STRAITS SETTLEMENTS CURRENCY.

of course, Mexican dollars after they are coined are still umble as silver, particularly in connection with the Straits, where they find their way as currency, and eliminating India, because Indian coinage is an un- certain factor, dependent on whether the trade is good or not, and eliminating Persla and Spain, because they are 100 uncertain. Eliminating all these countries T estimate the world's coinage at a figure of 51,800.000 ounces; and I reckon the Indian trade demand, taking the average of the last five years, at a consumption of about 22,000,000 ounces. The China trade will be an uncertain "quantity now, with the balance of trade against the increased by the indemnity; but I estimate their consumption at 13,750,000 ounces, which gives us a total of 128,650,000 ounces, and that leaves a surplus only of 44,288,000 ounces. Well, the coinage of British dollars for the last four years, have taken an average of 18,100,000 ounces, and that leaves a surplus only of 26.188,000, and out of that you have got to meet the Mexican home currency, that is to say the amount of the Mexican home dollars, which do not leave Mexico, and you have got to meet the increased demand for the Transvaal and Free State, which will be a large item; you have got to take the ordinary demands for Spain and Persia, and over and above all that we have India. which undoubtedly in the future will have to coin more rupees. I mean the stock they have got, although it is a large stock for their present requirements, they will in all probability have to add to, so that really that only leaves you a surplus which one might expert to be used if distributed over those vast countries.

1341. I suppose you do not put that forward as a per- fectly accurate calculation, but merely as explaining the present position Just as a rough guide.

1342. As a rough guide, and as explaining how it is that the total production of silver is used up in the different parts of the world ?-That is it. air. You know when the Indian mints were at work in 1900. 1001. in that particular year we had a very sharp rise in silver, as I daresay you are aware, and if I remember right the price rose as high as 30d., and that was simply due to one unexpected demand for coinage in that year: for nine months in the year consumption equalled pro-

duction,

1343. Is there much silver on the market which is not sold; I mean to say is the balance which is hanging over the market large, as far as you know, of unsold silver? -At the present moment?

1344. Yes? No, sir.

1345. It is not? Not so far as I know. I base my remark on this that the money position in New York is so acute that it is very unprofitable to hold any stock of silver there. Whereas nine months ago they wer attempting to manipulate our market here, since then they have sold heavily, and shipped all they can ship; and I think I am right in the statement, because the Board of Trade figures showing the imports into London from America showed a great falling off in the months of January, February, March. April and May. and since then they have almost entirely recovered it.

37

Mr.

1346. So that if any sadden demand for silver came it might make a perceptible difference in the price?—At J. A. Pixley, the present moment, considering our present level of silver, it would make a very large difference. Of course, 18 Des: 1902, silver, as you know, has fallen below 22.; it is rather higher to-day, but it is only 224d. At that price any exceptional demand would make a very large difference. 1347. Would it surprise you if there was a large rise in the price of silver in the next few years?—Oh, yes.

1348. I mean to 30d. 1-I do not think one could look to that to last.

1349. You do not look for anything like that 7--No, simply on the questions you are face to face with, this enormous production, and, dealing with this produc- tion, you have to recognise the fact that the machinery and the methods of mining are improving every year; and it is becoming more economical. The production

is more economical, and, therefore, they are able to go on producing without any likelihood of the conditions getting worse for them, and, further, if the margin of profit is small they will try to increase the output, so as to make this profit larger. But my own feeling is, that in 1901 you will find a substantial falling off. 410 always a year behind in these figures.

1350. And you would like to see 1903 close before you give a definite opinion?-I think we should know a great deal more then, because this has been a year, par- ticularly in the silver market, of great speculation. Until all these outside influences are removed it is very hard to say what the general tendency is.

1351. (Mr. Blain.) As regards the great falling off in the price of lead which affects the power of these mines to produce silver at s profit, irrespective of its price, is that A permanent reduction in the price of load 1-I think so. From the conversation I have had with the metal merchants in London they do not look for any substantial improve. ment. But I mean to say you have got to take the fact now that trade generally is not quite so brisk as it has been, and high water mark probably was touched about a year ago, and the tendency for lead, and copper, and tin, and for other metals, is rather to go down in price. 1352. (Chairman.) I think that is all we have to ask Is there anything else you would like to say 1--- No, I do not think so, sir. I do not think there is any- thing else I could say.

you.

sir.

1353. Have you any objection to your evidence being published 7-No; I have no objection at all, I see in taking the years 1899-1900, when, of course, silver was very much higher than it is now, if you go and take the coinage figures you would say why did not silver actually rise more than it did, as consumption was quite keeping pace with produc- tion? The answer is that during those two years the United States mints were put down as coining roughly $32.000.000 in the year, but they were not buying silver, they were using it up out of stock. Otherwis I think the movement would have been a very much larger one.

DATO ABDUL RAHMAN, C.M.G., culled; and Examined.

1354. (Chairman.) Is Johore your native country portion to the fall in silver ?—Yes, in the Straits and Yes, sir,

1355. Have you lived much in England --Off and on for the last 17 years.

1366. Have you any business here; do you follow any business-represent the Sultan and the Johore Government here.

1357. Has the fall in exchange of the dollar affected the inhabitants of the Straite and the adjoining States? -To the best of my knowledge it has.

1358. Has it affected all clams, or only some?—All classes.

1350. In what way has it affected the different classe, i -Because the price of articles in every way have risen with the fall of the dollar.

1360. Have wages also risen 7-Yes, to my know- ledge.

1361. I suppose fixed salaries have not risen so rapidly -Oh, yes, very much so.

1362. I mean fixed salaries, say of Goremment officials Yes, I think so.

1363. You think they have been raised, too, in pro-

everywhere else.

1364. Well, if the wages and salaries rise in propor tion to the rise in the prices of commodities, the effect of the fall in the value of silver is not so serious No; looking at it in that way, it is not so; but at the same time the hardship is felt always.

1365. In what way ?--Because, I take it, the Govern ment cannot always be increasing their servants' wages and salaries, but applications are constantly being made for an increase of wages and salaries,

1366. That applies to the officials. Does the same argument apply in the case of private persons ?—Yes, I think so, and also in the case of coolie labour.

1367. Do the small traders experience any difficulty as regards the prices of goods imported from gold stan dard countries-I think so.

1368. Do the dollar prices of these goods fluctusta very much? Yes, very much.

1369. Owing to the rise and fall in exchange?—Yes, especially in the prices of foreign goods; in fact, there are no other goods but foreign goods.

1370. D you think the fall in the value of the dollar

Dato Abdul

Rahman, C.M.C.