TNAG-0717-FCO40-914-Banking-and-monetary-matters-in-the-Dependent-Territories-is-1978 — Page 58

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(vii) A decline in this somewhat fragile market

is to be expected at some future date, particularly

if the present expansionary trends continue.

It is not possible on the evidence available to

estimate when the decline will appear, whether it

will lead quickly to a widespread demand for

redemptions, or whether one territory will be

more severely affected than another. It is reasonable

to expect that coins forming part of a relatively

small issue will retain a certain rarity value

which would not be true of the generally large,

subscription basis, issues. The value would also be

dependent upon whether the coins had a genuine

M

commeorative purpose and were well-designed, and

were thus attractive in themselves as numismatic

items, or whether the initial sales had resulted

primarily from intensive marketing techniques.

(viii) Possible Liabilities There are two.

One is that coins will be returned to their country

of origin to be used as legal tender. The other

is that they will be returned to be redeemed for

external currencies. It is clear that all issuing

authorities have a moral obligation, if not always

a precise legal one, to redeem their numismatic coins

at face value. But this liability carries no risk

for the issuing authority if it has foreign exchange

assets available which are equivalent to the

coins presented. If such assets are insufficient a

risk has been accepted.

Considering the position

of the dependencies overall, it is evident that the total liability at end 1976 stood at about 35 mn.

/Aveinat

fed

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