Thave mentioned only silk and piece goods by way of illustrations; but it is obvious that the same cause that affects them affects the price of every other article which enters into the international trade between the two countries. Apart altogether from changes of price arising out of the natural laws of supply and demand, which every merchant understands and lays his accotint for, you have here a new cause for disturbance altogether, and one which cannot be gauged with any reasonable certainty. Who would have been wild enough twenty years ago to predict that silver would go down to 27d. an ounce, and who will venture to say what it will be five years hence? Tt may be back to 60d. or it may be down to 16d. We have got, then, to this—that every change in the relative value of gold and silver entails a corresponding change in the price of all commodities capable of being exchanged' between silver-using and gold-using countries. Tempotary fluctuations work on the old lines to make bread and but fall on the merchants, bringing sometimes ess and sometimes profit, or loss to one and profit to another; but changes of a permanent nature necessarily and inevitably entail a permanent change in the general level of prices, either in the silver-using country or the vold-using country, or in both. Tam not at present concerned to discuss which country is likely to be affected, and whether prejudicially or beneficially; I only wish to impress on the meeting the tremendous nature of the consequences that flow from the present instability of gold and silver—consequences which the world cannot escape from #0 Jong as their relative value is left indeterminate.
This is what is meant by the rupture of the par of exchange—a term that, to my mind, hardly conveys full enough idea of the mo-montons results. It is not merely a question of remittances between the two countries. That is perplexing and annoying enough, but it can in some measure be obviated. It is the inevitable result in the changes of the level of prices, and the consequent disturbance of the equity of all contracts, that is the great and important feature. You are generally aware that the adjust ment of prices, of which I have just spoken, has, as a matter of fact, been effected by gold prices giving way. Speaking flare remained steady and gold prices have erally, silver prices of commodities
fallen. This was strictly true up to a comparatively recent date, and even yet four-fifths of the adjustment is due to the fall in gold prices, and not more than a fifth toa rise in silver prices. Iam not concerned with why that is so; but it is a fact. The result of that is that our trade with China as a whole has, in my opinion, been less affected than might be supposed. Te'is dificult. to say for certain that the volume of trade, as measured in commodities, is greater or less than it would have been had the old par of exchange been maintained. As the price of native products has not risen greatly (except in certain limited lines), there has been no very marked stimulus to exports from China, and as the silver price of cotton goods has not risen very greatly there has no general check on imports into China.
Text read from the printed page and cleaned; old type leaves the occasional error.