To the Editor of the Nontu-Cama Darty News, Sim,—The extract from a sharebroker's circular contained in your issue of Satur+ day, recalled to mind the substance of the few words from me in connection with the then condition of affairs in Hongkong, and: the depressed state of the best class of securities; with an appeal tu the goud sense and judgment of men in Shanghai to refrain entirely from the further purchase of shares pressed upon the market by the Hongkong brokers. My letter appeared in your valuable journal on the 11th ultimo, and its strong point was this;—"* The experience of the past six 1 has proved that so long as Shanghai the market a buyer prices are maintained, and even raised according to the demand, and speedily fall to lower depths than before on the cessation of that demand. No purchaser can rely upon quotations for one hour, Te hw buys ut 100 the same seller will offer more shares at 9:
Vhese remarks were taken exception to in Hongkong and elsewhere; but it is unnecessary to traverse views or opinions that have been falsified by events, Facts only should be dealt with in considering matters of this kind, and in ascertaining how far the suggestions made on the 10th of March are justified.
Confining attention to two stocks that are Inrgely deni in, it appeara that Hongkong 1d Shanghai Bunk shares have fallen feom 141% to 95%; and Bank of China from $10} to $6. This means a depreciation in the value of the shares of" these two concerns of $5,450,000; or at the rate of $118,500 per diem. "And yet the shares themselves are intrinsically better now than they were forty-six days ago! But the end is not yet. Hongkong has succeeded saleable at any price; and the danger landing Shanghai with every kind ut stock
ied. A process very like compule ieubl to guard ngnnst is becoming sory liquidation has been going on for sone wionths in Hongkong, resulting in ion of perfectly good and sound extent that must begin to react upon every financial institution connected with th If, therefore, the weeding-Which have proved disastrous ig should be extended to Shanghai, it will be found that the local market is glutted, with no buyers left and Hongkong still selling at prices that defy competition Investors have little to fear, It for them to decide whether the tite favourable for purchases to reduce mean value of their holdings. Opinions differ on this point. Prudence, however, dictates a waiting policy.
Earnestly, therefore, should the warning be repeated that further buying in Hon, kong is fraught with danger to Shangh which place is already overstocked with shares for which there is, absolutely, no present outlet.
Tam, Muntcers.
26th April.
Text read from the printed page and cleaned; old type leaves the occasional error.