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37619

THE GOVERNOR 16

(Pataphrase}

1!

No 24

THE SECRETARY OF STATE (Received 5 5 om. 17th November, 1909 }

TELEGRAM

[topy to Treasury, Nævmber 30, 1909, LA)

With reference to your despatch of the 20th October, confidential.* Crown Agents may sell four million dollars at 233d in order to pay the debt of the Com

ANDERSON missioners of Currency, balance should be invested at call

15

generally the instructions in that despatch, will show what payments will go to swell the Gold Standard Reserve Fund and what charges will be admitted against it I was originally contemplated that the Note Issue Gold Reserve would be held at Sugapore, and in that case the Gold Standard Reserve would for, at any rate, might} But, as the gold reserve is now to be held in London by have been held there also you, and as the operations of taking in and giving out gold, in order to maintain The gold standard. will now take place almost exclusively in London, it seems clear That the Gold Standard Reserve will also be kept by you.

37619

No 26.

I am, &c..

H. W. JUST.

PUBLIC RECORD OFFICE

T ། ། ། ། །།

Reference :-

C.O. 882

9

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH-NOT TO

PUBLIC RECORD OFFICE, LONDON

37431

No 25

COLONIAL OFFICE to CROWN AGENTS

[Fogy be Treasury, November 20, 1909. 7.F]

{Answered by Nos, 28 and 29.]

Downing Street, 20 November, 1909 GENTLEMEN,

WITH reference to the letter from this Office of the 13th instant, † I am directed by the Earl of Crewe to transmit to you a copy of a letter from the Treasury on the subject of the gold com received by you against Government notes issued at Singapore

Tam to inform you that Lord Crewe approves of your dealing with the coin in the manner suggested by the treasury, viz., that you should hold one-half of the 1 stal amount in gold, and that the remaining half should be invested or lent at call or on short loan In view of the penultimate paragraph of the Treasury letter, one- third of the amount not held in coin should be lent at call or on short loan only.

Lord! Crewe is advised that Section II of Ordinance XXVII. of 1908, which provides that the gold “may be kept in London in the custody of the Crown Agents," will require amendment in order that investing or lending a portion of the gold may be legalised It will be necessary, however, to consult the Governor by despatch as to the form of the amendment, and, in the meantime, as it is undesirable that the whole of the gold should lie idle, I am to authorize you to proceed as above indi cated, in anticipation of the legalisation of your action.

You will notice that the profit earned by the investment or loan of half of the gold received is to be paid to the Gold Standard Reserve Fund, the coin reserve of the note issue being credited only with the equivalent in dollars at the fixed rate of the gold received The investments, therefore, are to be kept distinct from the ordinary investment account of the note issue, and it will be necessary for you to keep a separate account of the gold reserve in your hands-in fact, two separate The Note accounts, the Note Issue Gold Reserve and the Gold Standard Reserve.

1--ne Gold Reserve Account will show the gold coin held by you, the money lent at call or on short loan, and the investments, whilst on the liability side will be the number of dollars corresponding, at any rate of 2s. 4d., with the amount of gold you love received Similarly, when you pay out gold hereafter, with the diminution of the assets of the gold reserve account there will be a diminution on the liability side calenlated at the same rate.

Actually the amount of dollars paid out at Singapore to purchase drafts on you will be less than the full corresponding amount at the fixed rate, and, conversely, the amount of dollars paid in to the Commissioners for the purchase of gold in London The profits will be rather more than the corresponding amount at the fixed rate. in each case will be held as part of the Gold Standard Reserve Fund, and eventually The profits on the investments of gold remitted to you to be added to the fund will also fas already stated) Le credited to this fund.

The Secretary of State's confidential despatch of the 18th of January, 19078 ta copy of which is contained in the volume of printed correspondence" already supplied to you privately), and the Ordinance XXVII., of 1908, which carries out

‡ No. 23. No. 196 in Eastern Ne, 108.

• No. 13.

+ LF i 18m tung copy of No 22.

(Confidential }

GENTLEMEN,

COLONIAL OFFICE to CROWN AGENTS. [Copy to Treasury, November 30, 1909. Z.F.]

[Answered by No. 29,]

Downing Street, 20 November, 1909. WITH reference to your letter of the 15th of October,* I am directed by the Earl of Crewe to transmit to you copy of a telegramt from the Governor of the Stans Settlements with regard to the sale of old dollars.

Lord Crewe approves of your selling the dollars as proposed by the Governor. and of your paying off the debt of the Currency Commissioners out of the proceeds.

As regards the investment of the balance, I am to explain, with reference to the letter from this Office of to-day's date on the subject of gold held in London on account of the Straits Settlements note issue, that Lord Crewe understands the old. cons now for sale to be surplus coins resulting from the re-minting. Under Section 7 of Ordinance XXVII. of 1908 the amount realized is properly payable to the gold standard reserve. The paying off of the debt of the Currency Commissioners is a proper charge against the gold standard reserve. As regards the balance, Section 16 of the Ordinance above quoted allows of investment in gold securities approved by a Secretary of State.

Although lending at call is not strictly such an investment, his Lordship approves of your dealing with the balance on the lines laid down in the case of gold received on account of the note issue-one-half should be held in gold, and one-half should be lent at call.

I am, &c.,

37619

No. 27.

H. W. JUST

THE SECRETARY OF STATE to THE GOVERNOR. [Copy to Prorn Agents, November 29, and to Treasury, November 30, 1909. L.F] [Answered by No. 33.] (Confidential.)

SIR.

Downing Street, 26 November, 1909.

I HAVE the honour to transmit to you a copy of the correspondence§ noted below on the subject of the gold received in this country against notes issued at Singapore and of the sale of old coins for gold.

As regards the general question as to the disposal of gold received by the Crown Agents. I shall be glad to have your observations on the remarks in the letter from the Treasury of which a copy is enclosed, both as to the obligation of the Straits Settlements to do something towards maintaining the general gold reserve of this country and as to the expediency, from the point of view of the Colony, of adopting the arrangements proposed by the Treasury.

The arrangements ultimately decided on will need legislative sanction. In the meantime, to avoid loss from keeping the whole of the gold in coin, I have authorized the Crown Agents to proceed on the lines suggested by the Treasury.

• No. 17.

↑ No. 24. ‡ No. 25.

Noe. 21, 22, 23, 25 and 26.

1 No. 23.