A couple of holidays this week has given us time to take some stock of the financial market as it rules in Shanghai. There is a mass of money in this centre, and the disposal of it throughout the community is of character to induce much thought, which if it could compel an equal consideration at Home of China's condition might bring about such pressure on the politicians that they would not be slow to adopt a strong policy in regard to China. At Home, during a period of trade depression like the pre sent, money flows naturally into gilt-edged securities, and such stocks as Government loans tend to show a strong appreciation, the inevitable result being that industrials, with their smaller certainty of a return on capital, are neglected and record a lower level of price. The same does not apply here in like manner and for this reason, that so much of the money is held by Chinese and their affections have not yet been developed in the direction of long term securities with an assurance of regular interest. They have a keen preference for land above all other things, while the merchant, ever wait-° ing for a chance to finance his imported cargoes into the interior with some measure of security, prefers the short term loan system which native banks offer so that practically at a moment's notice he may have his money to resume business operations interrupted by banditry and civil war. Naturally in a state of affairs such as the present we expect to see the merchants' money iv Shanghai, earning a low rate of interest while awaiting profitable employment, but there is more money than that of the merchants in the coffers of the banks here and a great deal more in Hongkong. Where that money comes from is a matter which Home business men ought to be interested in knowing, so that they can bring the Necessary pressure to bear upon sluggish politicians.
Events in Hongkong during many months back are perhaps a better indication of the state of affairs than we see it for ourselves in Shanghai, although similar conditions have obtained here in the past and may do xo again at almost any time in the future. Kuangtung is a wealthy province, inhabited by a race of merchants who rank with any in the world for business acumen. They have accumulated considerable wealth in the past, and in spite of official exactions have still gone on in the path of affluence. Where they have traded officials have equally waxed prosperous by methods at which they are adept. Kuangtung for the past two years and more having been the scene of turmoil, a great deal of the capital of the merchants has gone to Hongkong for safe keeping, thereby helping to swell the available capital in the colony. In addition, officials have found that the ever-changing kaleidoscope of events has not been for their comfort, and their '"'savings'' have likewise gone to the Colong, not filtered in but entering by the million. They have paid a remarkable tribute to the power of good government which they took care to avoid institut-
Text read from the printed page and cleaned; old type leaves the occasional error.