.10
· CURRENCY COMMITTEE,
as currency and that there would be ifliculty in disposing of those nlready minted without loss of the cost of making and importing them: We do not favour any attempt to. prohibit the minting or importation of British dollars, as such uelion might simply tend to raise the pre- mium on the note, until some ex-) Change corrective in the form of silver bars is provided,
2. As regards the control of note issue by private banking insti-
*
(Continued from Pagè 3:)
hold the reserves against them, and in a constantly recurring charge for-the staff of a special note de- partment,
Premium on Notes,
(4) is the premium on notes over
silver detrimental to the pros-l perity of the Colony? If so, can it be controlled and by- what means?, 23-We find, and are, supported in our finding by all the evidence, that the premium, as a fluctuating and uncertain factor, tends to drive trate past, the Colony, and is thus detrimental to its pros perity.
24-The causes from which the premium arises are fully discussed in various memoranda printed in Part 11. Briefly summarised they are as follows:--
There is a chronic excess of "invisible exports consisting of Chinese emigrants' remittances from abrond, which lead to large purchases of gold all round by the banks. Presumably cover in the shape of sales of gold is wanting
THE
+
CHINA
MAIL.
is absolutely necessary for their which is necessary to meet the production it was stated that, business. If it is assumed that growing needs of the Colony, we should the price of silver fall to silver parity is maintained in have arrived at the conclusion, 50 US. 'gold cents per ourice, 20 Shanghai, the local quotation for after our examination of all per cent. of the world's-production 'taels day by day`against a parity aspects of the case, that some would be made unprofitable, whilst of roughly Tis. 72 accurately in-readjustment may be called for in a fall to 334 cents per, ounce per cent. unpro- dicates the extent of the premium the restrictions now imposed upon would make 58 here, but in spite of large imports the note-issuing banks. Admitted Stable. It was also pointed out at af British dollars the expected ly the power of note issue possess the same time that the reduction effect of removing the premium or ed by banks involves a serious of output would probably not fol- restoring a normal taef rate has responsibility on their part to low immediately on the decline of not followed. An exchange correc- Government, which represents the prices. These remarks might well tive therefore has still to be-found. interests of the public, and, we be taken in conjunction with the. An Exchange Corrective. make the following proposal there views of the Chairman of the 28-We might hererofer in fore with somo diffidence. As the Shanghaj British Chamber of Com-| passing to the use of sycee in law stands at present the extent of merce, who in February last in a Shanghai, and remark how in spite note issue is limited by the amount letter addressed to the Chinese of its disabilities this medium of the capital of the bank concern Minister of Commerce and Indus-1.
Only the Hong Kong and try, Nanking made the following functions within certain limita as ed. an exchange corrective. The ex- Shanghai Banking Corporation may statement: change level in Shanghai cannot issue notes in excess of the statu- remain for long too high above the tory limit, and then only under laying-down coat of silver; and onerous conditions. We think the again.. opposite but natural forces prescribed limit should be less ur
Anticipate China's Move. re immediately put in action bitrary and should be subject to
35Finally slice China has should the exchange level tend to periodical revision, provided al
worked move too far below the actual value ways that the banks of issue fully now
out through the of silver. It may be assumed cover their notes by the deposit in agency of the Kemmerer Commis- roughly that, when exchange in the Colony of bullion or silver dol- sion a complete and---detailed! Shanghai is quoted at 41 per cent.lars to the extent of at least one scheme, whereby in more, pro-1 below silver, point has been third, the balance being covered by pitious circumstances she may reached at which it begins, to be approved securities deposited en-make the change to a gold standard profitable to ship sycee and sell it tirely under Government controt. currency, we consider that it is of for its silver content. We have The public would thus be adequate the utmost importance that Hong previously shown, that the export ly safe-guarded.
Kong, as being unable herself to exercise any control over the price
T
The present stocks of silver in Shaughal would be insufficient to finance China's trade, were such trade.normal."
-TUESDAY, JULY 29, 1930.”
BUSINESS DIRECTORY
AT THE NEW SILK STORE.
SHIRT
AT THE
From
$3.00
TAJMAHAL SILK STORE 5, Wyndham St. Tel. 20136.
-BOOKBINDING.
_THE_NEWSPAPER
ENTER-
PRISE LTD., for Suparior Binding "China Mall" Offices,
SA. Wyndham Street. Tel. 20022
BOOTS & SHOES.
-DENTIST.
Pair
tions we have more to say on this topic when we come to liscuss the remedies for the premium. Those who are dissatisfied with the System of issue by private banks have suggested to us as alterna- tives, either that Government should take over the whole note isspe, or that it should exercise, a much more direct control than it does at present
over the issuing banks. We have given careful consideration to their views, but have concluded that much of their dissatisfaction arises from a mis; apprehension regarding the obliga tion of the note-issuing banks and thus the market becomes one-point of the British dollar does not 30-A-the root of the difficul Although notes were never legal sided. It might have been expect arrive -until our exchange falis toties in connection with the pre of silver, should be in a position Leather Sole Canvas Shoes ...$ 4.50 tender, but were primarily a con- et that relief would have been ob over 3 per cent. below the price of mium is to be traced to an excess to anticipate such a move on the Crepe Rubber Sole Canvas Shoes $ 6.00 venient appendage to the currency, tained by the resumption of the the silver content of the dollar. of inward remittances, it is obpart of the last remaining user of Crepe Rubber Buckskin Shoes $10.00 and although the law never con- import of silver dollars, but the Bearing in mind then that as a vipus that the recent lowering of silver on a large scale. Although Black or Brown Shoes from $6.00 Black or Brown Boots Com $ 8.00 templated that they should sup- difficulties attending their use for circulating medium British dollars the rate of interest allowed by we cannot see that China will be Children's Boots ur Shoes from $ 2.00 plant silver dollars,. It has come inter-bank commitments are still have a very limited use, and in banks on deposits should also in able to take this step in the in- Best styles, most complete stock about that a demand for currency considerable, even though since settlement of inter-bank commit the long run tend to remedy the mediate future and although wa
of all sizes. Repairing, a specialty. WONG SIU WOON is in fact a demand for notes, to October last year it was agreed be- ments are far from being accept situation. But owing to the unpre- are rather disposed to regard
21, Pottinger St. Phone 21176 supply which in practice entails a tween banks to accept them free-able, it occurs to us to put forward cedented fall in silver, overseas China's desire for a gold standard purchase of gold by a bank of ly. Prior to that date by tacit the suggestion that some scheme Chinese have been induced to make for the time being as a pious hope, Consequently what the understanding between banks they might be agreed upon among the excessively large remittances to since any such scheme in the însue. party of demand regards prims were not accepted at all, and con-
banks whereby bar-silver might be Hong Kong with a view to getting nature of things must entail the .facie is an obligation in regard to sequently no actual exchange cor-
utilised in the place of minted the benefit from an expected rise reorganisation of her political and currency becomes, from the point rective existed. The British dollar coins in inter-bank settlements. in exchange, and it may be some fiacal machinery and the obtaining of view of the party of supply, la, current to any large extent only all indications seem to show that time therefore before the action of of large financial credits from out- nothing more or less than an ex- in Hong Kong and its costs through there is a glut of silver dollars in the banks will make itself fully aide, neverthelees Hong Kong change operation, which can only seigniorage and interest are ap the Colony, and if some such fully felt.
should not be found unpreparęd be optional. We doubt whether in proximately 5 per cent; moreover scheme for the use of bar-silver
Follow China!
for such an event In China, or she the special circumstances of this since the only way of disposing of could be agreed upon among the (e) is the linking of the currency might find herself a holder of Colony, from which a large quan- it elsewhere is by melting it down, banks
with silver advantageous to much cheapened silver, situa- the loss on seigniorage tity of fotes must continually be to
meet the loss thereby
contem- the Colony? If so can it be tion too. disastrous to might be avoided, and it might drained into the hinterland of incurred, another 3 per
cent.
,then be possible to prevent the für-
plate. more closely Unked? Chlua, such an obligation could be might have to be added
ther indiscriminate minting of 31-We consider that we have $6-We recommend therefore 'placed even on Government as to its cost. Consequently in
British dollars, for minting which supplied sufficient answers to these that all available data should as nole-issuing authority.
permission might be granted by questions in our remarks in reply boon as possible be placed before Government only in special cir- to question (a), where we imply expert opinion with a view to the cumstances when the note reserves that as long as China links her cur- formulating and having in readi or the Colony'a requirements de- rency to silver so long must it be ness a feasible scheme worked out mand a further supply. We do not advantageous" to the Colony to do in detail whereby the transfer of consider that outside interests likewise. In the preceding para- the Colony's currency from a silver should be allowed the latitude per- graphs we have indicated the to a gold basis may be effected as mitted under the present system means, by which a closer link may smoothly and with as little trouble and expense as possible, in case a of saddling Hong Kong with super- be forged. fluous coins in order to gain an
sudden change-over be forced upon the Colony. immediate profit, a practice which incidentally aggravates the pro- blem for the Colony If and when have already Indient-stabilisation has to be effected, ed, the inconveniences' attend- ant on the use of silver dollars discourage the banks of issue from accepting any more of them than
comparison with the uncoined metal, the silver dollar possesses grave disadvantages, in that its import and export points are wide- ly removed.
22.-We, cannot moreover все that in the circumstances of this Colony a Government note-issue would have any advantages over a properly controlled private wote- 27. As regards the possibility issue. On the contrary, it might in- and means of controlling this pre- volve Government, and indirectly mium, we consider that if the the taxpayer, in the risks of heavy issuing banks here were to give losses-due to fluctuations-in-the-out-notes-freely in exchange for value of silver and securities, risks. legal silver coins, the exchange which bankers, being daily engage level of Hong Kong currency must ed in them, are more competent approximate to silver parity, but, both to anticipate and cover. Government note-issue again would involve Government in heavy initial expenditure in laying down notes and building treasuries to
NOW ON
SALE.
THE
A
As we
M
Elasticity Necessary. 29.--To give effect to these measures of reform, and provide for that elasticity in the currency
ASITAR, one missee have ling you up when you go out, me no savvee what name but me catchee number.”—He produces a dirty piece of paper an which is written 24641, Mr. Tupman' was in an embarrassing position he knew so many ladies. He was not the man to spend hours perusing the Telephone Directory, so he spent an uneventful evening waiting for the second call. That was enough for him, he went out the next day and purchased the TELEPHONE HANDBOOK. Now he is able to tell in a few seconds who rang him
up.
Contentment shows on the face of Mr. Tupman after his por. chase of the Handbook. His note book is the result of a survey of this book. He is genuinely "satisfied, and does not regret
buying this book of reference.
TELEPHONE HANDBOOK.
Giving the new automatic numbers in
NUMERICAL ORDER.
Published By
PRICE $1.00
THE HONG KONG DOLLAR DIRECTORY CO: CHINA MAIL OFFICES, “3A, WYNDHAM STREET.
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*་
(f) lait. desirable in the interests of the Colony that the value of the dollar be stabilised? If BO can any effective steps bel taken to that end?
1
'Again-Fullow' China! 37-Although it, le premature at
HARRY FONG, Dentist,
1st floor, No. 74, Queen's Road
Central. Tel. 21255.
TANG YUK, DENTIST Successor to
the late SIEN TING, 14, D'Agullar Street,
TERMS. VERY MODERATE Consultation Free.
DRAWN THREAD WORK.
Just Arrived
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the present stage to indicate what Unusual New Designs
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the
at.
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72, Queen's Road, Central. Tel. 23270.
ENGINEERS & SHIPBUILDERS,
· W, 8, ́BAILEY & CO, LTD,
Kowloon Bay.
„„„New Work' & Repairs."
Call Flag "L"
Sole Agents for Kelvin Motors.
GENTLEMEN'S-TAILORS,
THIS IS WHAT YOU ARE REQUIRING.
WELL TAILORED SUMMER SUITS.
AT REASONABLE
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Tel. 23056.
HAIR DRESSERS & BOOKSELLERS
LEE YEE,
Ladies' and Gentlemen's Hair
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HONOUR
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DAILY CROSSWORD PUZZLE.
(This cross-word puzzle has been made by an expert dut our readers are warned to look out for occasional phonetic
spellings, such as harbor, plow, and altho,).
14
15
6
19
110
12
13
15
19
32. It is conceded on all hands gold-currency unit should be adopt- that stabilisation in currency mat-ed by Hong Kong, our close busi- tera is an ideal which it is most ness relations with China' require desirable to attain, and if it could us to atress the advisability of this be realised here to the extent to Colony adopting a monetary unit FOOK WENG & CO. which it has been effected, eise- identical with that of our neigh- where-all-the-problems-connected bours, following the example set in THE ONE PRICE STORE with the Colony's currency would this respect by Canada with regard! automatically disappear. The only to the United States of America. justification for. adhering to the 38.- conclusion we desire to existing silver currency is, as we add that, since our terms of re- have already fully explained, the ference confined our enquiry fact that Hong Kong la'yoked to primarily to a consideration-of the South China both geographically effects of the Colony's and commercially, and in the last upon trade, we have refrained pur- resort the question becomes a posely from commenting on choice of evils: whether the Colony hardships of residents and others should face the loss of trade, which financially interested In the is apprehended if it adopts a gold Colony, who are losing heavily basis, or whether it should continue owing to the unprecedented fall in to be buffeted by the fluctuations the price of silver, but we
trust attendant on the use of silver as a that the omission may not be basis for its currency.
construed as implying any lack of 33.-We would here emphasize sympathy with these sufferers. that stabilisation, could not be
39.-We desire to express our effected at any arbitrary figure but thanks to our Secretary, Mr. T. would have to be determined by the Megarry, of the Hong Kong Cadet value of silver at the time when Service, for the capable way in the change is made, as present which he performed his many and holdings of silver must be sold for arduous duties, and niso to Miss what they will obtain in the new V. R. Harrison, for her assistance currency in order to finance that in the secretarial work. currency. We are not prepared to hazard an opinion as to the sterl- ing price our silver dollar on final- ly being disposed of would fetch, were sabllisation to be agreed upon, but undoubtedly the price would be much lower than tho exchange value of our currency at the time the decision to stabilise was taken. Any attempt therefore to fix arbitrarily the sterling value of the dollar at a higher rate must involve a serious loss, which neither a Government nor any private individual would be pre- pared to suffer. It is obvious that, during the period of transition to- wards stabilisation and for long afterwards, trade and commerce will-suffer bevere dislocation, but. how far-reaching the effects may
or how quickly the Colony (The would recover, can only be a mat ter for conjecture.
be,
No Over Hasty Action. 84-As regards the future of allver we do not feel confident to But express any definite views. though we fully realize the uncer- tafuties and risks of the altuation in this respect, we would deprecate any over-hasty action, to effect stabilisation at a figure that sub- sequent movements in the price of silver might prove to have been tll-advised and disastrous to the best interests of the Colony. In this connection it may not be put of place to repeat the evidence given by American Interests before the Royal Commission on Indian Currency and Financa in May 1828, when with regard to the effect of the price of silver on the World's
2 13.
7
11
16
20
་་
234
We have the lionour to he Sir,
28
Your Excellency's most obedient servanta,''
30
34
136
141
145
44
48
152
C. Mcl. MESSER, Chairman.
M. J. BREEN.
C. CHAMPKIN.
CHAU YUE TENG. A.. H. FERGUSON. V. M. GRAYBURN,' R. H. KOTEWALL. LI THE FONG.
C. G., S. MACKIE. D. O. RUSSELL. T. MEGAREY, Secretary. 14th July, 1930.-
H. E. Sir WILLIAM PEEL, K.B.E, C.M.G., 23
Governor, etc.
, Hong Kong. reservations by the Hon.. Dr.Kotewall, C.M.G, LL.D., were published in the China Maž yesterday.)
SATURDAY'S SOLUTION. JOY DOCTORS HEW AVON BARGO-CORE MERE FLATS LAST REST LYG CART
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MANGLED
TEA PRENT:
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4-Angry
7-Grenk who per-
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33
HORIZONTAL (Cont.)|" VERTICAL (Cont)
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[38-Toward
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Columbus embark id'In 1402 11-Top of tho, hund 12-Point of compass
(abbr.)
42-Pierced, as with a
Norm'
-14-Greek god of love"
18-Hall
17-8piritous liquore
(Japan) 18-Friend2 (French) 20-Negative reply
21-Withdrew from pub
He
service 23-Mountain (abbr.)
+ M-Genuine
28-Heart
* 28-8mall stream of
Water
(29-High tablaland
30-Combining form."
VOLICI
#32-Lafre
43-A beetla 44-Patron saint of
Norway 40-Chiness” plant 47-Naked: 48-To ona alde 50-Hymn 52-Finish
53–A fyrió poem
VERTICAL
11-A woodland spirit
(Gr. Myth.)
13-Covering of the
body 16-To rest
| 17-Giving up for e-
price mengs [18-Withdrew from
union
21-Elevate
22-Stupefied
25-Period-of time |27-Goddess of mallo
2. Tous mischief, 20-Stringed Instru
ment
31-Certain [38-Templat
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cally
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10-River in NW!
Franc
36–To favish-extreme 79% fondness upon). 27+Harvest
39-Metal In raw utate: 41-Comfort [43–Small valley: 45-Part of a fish.
| 47-WJoked
49-Ministers degree
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51-Therefore
(The solution of the above cross-word puzzle will appear i to-morrow's issus along with a new cross-word puzzle.)
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