CO129-411 - Governor Sir May - 1914 [5-7] — Page 30

C

Sir G. Fiddes

Please see Sir J. Anderson's

minute on 18371. I think that for the reasons

given in this desp. we must let him call for

tenders.

Par. 5 is a little obscure. What he means

I think is that before they have spent the full

5 millions the total to be spent from balanoes

on buying these coins in the open market) they

will begin to receive the amounts realized by

the C.A. Irom the sale of the silver. The opera-

tions of buying in the open market can then go on

with the help of

from the amounts realized without exceeding the

5 millions.

A

A.

approve by tel. and let C.4. have copy of

A

P

corresp.

Arc 2.6.th

·2.6.14

}

NA CONFIDENTIAL.

Sir,

1/3371

73371

19602

28

REC

REGE 9 44 14]

GOVERNMENT HOUSE,

HONGKONG. 9th. May, 1914.

I have the honour to acknowledge the receipt

of your cypher telegram of the 17th. of April informing me that

you approved of the proposal for purchase in the market of subsidi-

-ary coins but desired that the purchases should be made quietly and secretly by an agent in order to prevent artificial disturbance

of the rate of discount.

2.

I have carefully considered this question,

with the assistance of the Executive Council, and the conclusion, in

which the Council agree, I have come to is that it would not be

possible in this small Colony to keep such transactions secret.

3.

The Government has no Treasury vaults of its

own and it would therefore be necessary after each purchase to send

the coins to the Hongkong and Shanghai Bank to be shroffed, packed

and shipped to England. A very large portion of the Chinese Staff

of the Bank would be employed in these handlings of the coins and

since the Bank itself has never sold subsidiary coin out of the

Colony the fact that the transactions were on behalf of the

Government would soon be known.

4.

The best way in my opinion and in that of the

Executive Council in order to avoid undue disturbance of the

exchange value of subsidiary coin, is to make regular purchases

say weekly or biweekly; and the method of acquiring the coins that

will

THE RIGHT HONOURABLE

&C...

LEWIS HARCOURT, M.P..

&c.,

ke...

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