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PUBLIC RECORD OFFICE

Reference :-

PLLC.O. 882

بلسا

PUBLIC RECORD OFFICE, LONDORE

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

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last and to previous correspondence on the subject. of the currency of the Straits Settlements, I am directed by Mr. Secretary Lyttelton to transmit to you, to be laid before the Lords Commissioners of His Majesty's Treasury, the accompanying copy of a Confidential despatch† which has been received from the Governor.

2. Mr. Lyttelton is prepared, if their Lordships concur, to approve the proposals made by the Governor, and he would be glad to receive an early indication of their Lordships' views in regard to them.

27203

SIR,

No. 68.

TREASURY to COLONIAL OFFICE.

(Received 2nd August, 1904.)

I am, &c.,

C. P. LUCAS

Treasury Chambers, 1st August, 1904. I HAVE laid before the Lords Commissioners of His Majesty's Treasury Mr. Lucas's letter of the 13th ultimo (23620/04), forwarding a copy of a Confidential despatch from the Governor of the Straits Settlements on the subject of the currency of the Colony.

In reply, I am directed to request you to inform Mr. Secretary Lyttelton that my Lords concur in the steps proposed by Sir John Anderson, and in the terms of the draft Proclamation which accompanied the letter under reply, but they are of opinion that paragraph 2 of the Proclamation should follow after paragraph 3.

27240

No. 67.

I am, &c.,

E. W. HAMILTON.

THE GOVERNOR to THE SECRETARY OF STATE.

(Paraphrase.)

(Received 1.55 p.m., 1st August, 1904.)

TELEGRAM.

[Answered by No. 68.]

My Confidential despatch of June 7th. I propose to issue demonetization Proclamation as soon as preliminary arrangements can be made. I am advised that there is now an ample supply of the new coinage in circulation.—ANDERSON.

27240

No. 68.

THE SECRETARY OF STATE to THE GOVERNOR. (Sent 1.30 p.m., 3rd August, 1904.)

TELEGRAM.

Referring to your Confidential despatch of 7th June,† proposals approved. In reply to your telegram of 1st August,§ no objection. It is suggested, for your consideration, that third paragraph of Proclamation precede second.---

LYTTELTON.

• L.F. transmitting coples of Nos. 59 and 60.

↑ No. 64.

+ No. 65.

No. 67.

Attached to 28739/S

(Private.) (Extract.)

No. 69.

SIR J. ANDERSON to SIR M. OMMANNEY...

(Received 15th August, 1904.) [Answered, private, 2nd September, 1904.]

21st July, 1904.

I wish you could get Mocatta and Goldsmid to give you their views as to the future of silver, in connexion with the question of establishing a fixed exchange with gold. I shall have to face the matter shortly, and the present outlook appears to me to be very much against fixing the point so low as 2s. We are on the verge of that now.

A telegram just in says that to-day the dollar is 23 ths, and Hong Kong is only 4 per cent. below us. It has risen steadily since I have been here though slowly, and it almost looks as if silver would permanently settle down at a figure which would make a 2s. 6d. dollar much better for us in every way than a 2s-if indeed the latter is possible.

I may be wrong, but I have a tendency to believe that a slow and steady rise

is much more likely to be permanent than a big jump.

Attached to 28739/S

GENTLEMEN,

No. 70.

MESSES. PIXLEY AND ABELL to CROWN AGENTS.

[Copy to Governor, private, 2nd September, 1904.]

27, Old Broad Street, London, E.C., 26th August, 1904. IN further reply to your letter of the 23rd instant, we feel some hesitation in expressing an opinion as to the future of silver; the general conditions of supply and demand, which ultimately govern the price of silver, and on which alone any safe opinion can be formed, having only a gradual influence on the market, while the sharp variations that occur are caused by the factors, favourable or unfavour- able, that are in operation at the moment.

The general conditions may be considered favourable at the present time.. The world's production in 1902 was, roughly, 167 million ounces, or about six million ounces less than in 1901, and the tendency is to a smaller production.

The Indian Government has been a large buyer of silver. In 1909 they bought £3,000,000 or, say, 30 million ounces. In the early part of this year they purchased about 20 million ounces, and recently they have been in the market for 10 million ounces more.

Their purchases for the remainder of the year will be mainly dependent on the trade condition, and the state of the currency reserve. The best opinion is that they will require large amounts as the crops are on the whole big, and prices are high, and the outflow of currency up the country will be consequently on a large scale.

Their reserve now stands at Rs. 13,37,00,000, with the busy season still in front of them.

France has so far bought close on two million ounces for her Colonial coinage, and is expected to be in the market again. Last year her purchases were 84 million

ounces.

The United States are expected to buy, both for the Philippine currrency, and also for their own subsidiary coinage, the reserve of uncoined silver lying in the Treasury being now practically exhausted; but we do not look for any buying for this quarter until after the Presidential Election.

While the war between Russia and Japan continues there will be a steady demand for silver, for the movement of troops and the payment of supplies in Manchuria.

Russia has so far met the bulk of this demand by using up her reserve of uncurrent silver roubles, but Japan has been a large buyer of Mexican dollars, which have been shipped from San Francisco to Japan.

The Indian bazaar has been until recently a steady buyer, and, with a good season in front of them, they should take further large amounts.

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