To the Editor of the Sim.—In your issue of May 25th, page 631, you say that the present trouble with the'medium of exchange is of grave and immediate importance; "but what we can do here in the matter is not obvious." China is to demonetise silver, or the world revert to hi-metallism, as such an authority as Sir David Barbour seems to believe, would it not be doing something if your influential newspaper should give its readers sound views of the question in advance to Prepare them for s0 momentous a change! You further say: "There is no question that the decline in exchange has promoted the export trade in China, and it is noticeable that the Chinese seem to be able, in the prices they pay for imports, to follow the rise in gold, at least in the staple products." This seems to mean that in your opinion the decline in exchange is on the whole a good thing for trade in China. Can you not give us your opinions more at length as to the requirements, and uses of a standard of value for the P of exchange? Should it, for example, be as stable as possible or is it better for trade to have it occasionally rather variable? Should the medium of exchange be confined to its legitimate purpose of facilitating exchange i.e., barter, or is it better for trade in the long run that governments should raise or lower the standard of value by debasing coin, infating the currency with over issues of paper money, diminishing the demand for and value of silver by demonetization and similarly increasing the demand for and value of gold by giving it exclusive privileges, or the like, if thereby exports may be temporarily increased at the expense of imports, of the reverse?
Judging from the attention paid to the question of exchange by the Chairmen at recent meetings of banks connected with India and China, I believe that your views would be of interest to many of your readers besides Isquiner.
June 3rd.
Text read from the printed page and cleaned; old type leaves the occasional error.