C. O.
152
46590
ENCLOSURE NO. TO GOVERNOR'S DESPATCH No.466 of
24th October, 1902:
24 NOV
From the Hon.G.W.F.Playfair
To the Hon. Colonial Secretary.
Sir,
DONGKONG,
18th October, 1905.
A |
I beg to acknowledge your letter of 17th enquiring
on behalf of His Excellency the Governor whether in my opinion it would be more expedieat to raise the proposed loan in Gold or in Silver, and with your permission I would first set dowa
the pros and cons.
A first Silver Loan would have to be floated at 5% whereas a Gold loan would be obtainable at 84% in London
on the face of plus, I presume, the Crown Agent's Commission it, it would appear cheaper to borrow in London than in Hong- Kong but that same argument was used in 1898 when exchange was 2/74 and when the then Governor's advisers laughed at the
idea of exchange ever touching 2/- but exchange is now a long way below that and at 1/8 we are to-day paying 5.454. interest instead of 4%. It is true that exchange would require to fall to about 1/2 before the sterling loan would cost 5 but with the experience of the past oefore us, he would be a bold man who would say that it will not do so.
B. |
el
able to get fixed deposits at 47
A doubt has, I know, oeen expressed that a silver loan could not be floated here but with the Hongkong Bank
don't see why the Government
should
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