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SECRETARY, Straits Settlements, to CROWN AGENTS

31st December "Paid Aird 8×0,000 in redemption of currency securities."

We gather from the telegram from the Colony that the Colonial Govern- ment has adopted the suggestion made by us that these telegraph transfers should be carried out by the Currency Commissioners, and the proceeds used in liquidation of the advances made from the Loan Account, and we have, therefore, carried through the transaction in question accordingly.

4407

No. 279.

I have, &c.,

E. E. BLAKE.

THE GOVERNOR to THE SECRETARY OF STATE. (Received 6 February, 1909.)

(Confidential.)

MY LORD.

Government House, Singapore, 14 January, 1909.

I HAVE the honour to acknowledge receipt of your Lordship's despatch (Confi- dential) of the 3rd December.* enquiring my reasons for proposing to fix the selling price of the old dollars at 27d. per oz.

2

As I pointed out in paragraph 8 of the despatch of the 8th July,† the effect of selling at a less price than 25d. per oz. would be to sweep away the whole of our gold standard reserve.

3. My view was that the surplus dollars should not be sold at a lower price than would leave about half a million dollars in that reserve, and I instructed the Treasurer to prepare an estimate accordingly.

4. The enclosed memorandum prepared by the Treasurer shows that selling even at 25d. would leave a deficit, and that the object I had-in view would not be attained by selling at any less price than 27d.

5. It is possible that the number of dollars to be sold may prove considerably less than the figure taken, viz., 174 millions, and if the number as the Treasurer is disposed to think-comes to three and a quarter millions less, it would then be possible to sell at 26d., as the 4 million surplus new coins would bring in £433,918, and the loss on the 93 millions would come to £234,166-a difference of £199,752, from which must be deducted £126,042—as shown in the Treasurer's memorandum --and the cost of shipment, &c., referred to in the same memorandum.

6. When all the old dollars have been received it will be possible to fix with accuracy a minimum selling price, but I do not consider that until that is the case the price can be safely fixed at less than 27d.

I have, &c.,

JOHN ANDERSON.

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$369,281 may with absolute safety be allowed for "melted and lost," so that the amount of dollars to be called in may be taken at 17,250,000. My own estimate, as stated in my memorandum of the 16th July, is 14 millions, and I am inclined to adhere to it. From the latest notices received from the Banks and Government Treasuries since demonetization we have in our possession 12,834,532 old dollars, and I do not expect to get in more than another million before the end of April next.

It is, however, safer, as His Excellency the Governor has done, to take the larger figure as a basis for our calculation for fixing the selling price of our silver.

$4,750,000 will be the surplus new coins on the reminting. These will be exchanged for old dollars, which will be credited at their bullion value to the gold standard reserve.

4,750,000 old dollars represent 4,005,400 ozs. standard silver, and their value at the following rates per oz. of silver will be:-

22d.-£367,162.

23d.-£383,851.

24d.-£400,540.

25d.£417,229.

26d.- £433,918. 27d.-£450,607.

28d.—£467,296. 29d.—£483,985. 30d. £500,674. 31d.--£517,383. 32d.—£534,062.

If we call in $17,250,000 by issuing notes and new dollars in exchange for them

the amount in the coin portion of the Note Guarantee Fund will be $12,500,000, as $4,750,000 will be placed in the gold standard reserve.

The nominal price of $12,500,000 at 2s. 4d. is £1,458,333. $12,500,000 (old Straits Settlements) will give us 10,540,540 ozs. of standard silver, and the following table shows the value of this amount of silver at rates varying between 22d. and 32d. per oz., and the loss (viz., the difference between the token value and the bullion value) to be made good to the vault :—

Price per or.

Bullion Value.

Loss to the Vault.

£

£

22d.

966,216

492,117

23d.

1,010,135

448,198

24d,

1,054,054

401,279

25d.

1,097,973

360,360

2tid.

1,141,892

316,441

2741.

1,185,811

272,522

28d.

1.229,730

228.603

29d.

1,273,649

184,684

30d.

1,317,568

110,765

31d.

1,361,487

96,846

320.

1,405,406

52,927

In accordance with the suggestions made in paragraph 4 of the Secretary of State's Confidential despatch of the 18th January, 1907, and the provisions of the new Currency Ordinance now under consideration, the following charges lie against the gold standard reserve :-

Enclosure in No. 279.

(B.)

MEMORANDUM.

(a) Total estimated cost of reminting (8527,190.40 or £61,500

has already been paid)

£75,000

35,374,281

+

14,255,000

(b) Difference between the taken value and sale value of 3 million dollars sold $196,045.32 already paid to the vault (c) Difference between token value and sale value of 1 million

dollars' worth of subsidiary silver-$173,457.07 (d) Estimated loss on sale and reminting of British North Borneo

copper coin withdrawn from circulation $68,000

I

22,872

20,237

7,999

3,000,000

£126,042

500,000

17,755,000

17,619,281

If we sell at 27d., the position of the gold standard reserve will be as follows:-

Bullion value at 27d. of 4,750,000 old dollars Deduct total of charges against the gold standard reserve as

£450,607

shown above

128,042

† No. 262.

£994,565

Total number of old Straits Settlements dollars minted

Deduct-

Number of old dollars used for reminting.. Number sold and melted

Number exported to Shanghai by Russo-Chinese

Bank and melted

• No. 274.

PUBLIC RECORD OFFICE

Reference :-

61

TIILLIC.O. 882

9 PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH—NOT TO

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