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as readily obtain the same price as in 1889, I have reason to doubt whether, unless under exceptional circumstances, the price to a buyer would be any less now than then. On this point I will read what is said to me by a gentleman, whose position is one likely to render him specially well acquainted with the subject:-"The "value of Marine and Inland Lots has not in my opinion declined since 1888. The "intrinsic values of town and suburban lots have increased within the last two years to the extent of $2,000,000 at the least by new buildings and improvements. "Even where no improvements have been effected no house property in Victoria "can be purchased now, under ordinary circumstances, at a less price than in 1838. "House property in the villages has increased in value particularly at Yaumati, "and the only apparent depreciation is in suburban property which is occasioned "solely from over-building. A great increase in rentals took place in 1888-89, "owing to the great number of two-storied houses which were then pulled down "for the purpose of building houses of three stories in their place. During the period of pulling down and re-building there was a dearth of house accommodation "and many families left the Colony not being able to pay the higher rates demanded. "I find that Chinese tradesmen formerly paying at the rate of $35 were compelled "to pay $50 a month for rent or leave and lose their business. Then came the "over-building, upwards of 700 new houses being built to meet a demand for about *150 houses. The reduction of rents followed of course, but I do not find that rents in Victoria have decreased except in cases where they had been previously raised to an almost prohibitive extent, and there is no general appearance of "reduction in capital values."

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Now though this gentleman may possibly be somewhat over-sanguine in his views, I myself have reason to believe them by no means far from the truth, and I know them to be correct as to the increased value of land in the villages. In any case, they make clear that some of the causes of depreciation are entirely consistent with the absence of any general decline of prosperity.

To sum up the situation. While it must be admitted (1) that a large sum of money has been lost to the Colony in outside enterprises (2) that owing to the great building operations of recent years, the supply of houses is now considerably in excess of the demand and (3) that the value of land has consequently fallen below what I not indistinctly intimated as the inflated values of 1889. Yet on the other hand there are: (1) in the prosperous condition of all our leading enterprises and industries, (2) in the increased quantity of shipping at a time of unusual depression all over the world, (3) in the increase of the regular trade of the Colony as evidenced by the Imperial Customs returns--and considering all things (4) even in the small decrease, if there be any decrease, in the Bank deposit accounts-there are, I say, in all these things indications of distinctly favourable promise for the future, and such, I venture to think, as give strong grounds for the belief that any depression that exists is merely temporary, and as on many former occasions in the history of Hongkong is only the precursor of still further increase of prosperity at no distant time. It may be judged therefore from what I have said that I do not at all share the gloomy anticipations of the Honourable Member. You no doubt have frequently observed that the organisers of Chinese processions, in order to make a more imposing show of followers, will engage coolies whose labour-soiled rags are barely hidden by coats thrown over them resplendent in gold and colour. Now it seems to me that the Honourable Member bas reversed this process, and has succeeded for the moment, but only I trust for the moment, in throwing a squalid covering over the brilliant uniform in which Hongkong usually appears to the outside world, and which I shall still venture to believe is rightly belonging to her.

Before coming to the financial position of the Colony, which the Honourable Member regards as so unsatisfactory, I think it right, however invidious may be the duty, of touching on another subject, akin to it, respecting which the Honour-