To the Editor of the '"Nontit-CHina Datty News."
Sin,—Your leader. on the silver question and. the cause of silvei's Gecline is of real public interest. 'The question is the most important one that confronts the people and the government of China to-day. 'Your leader is devoted quite largely. to' exculpating India as an active gent of the present currency cat-Astrophe.
You state quite correctly that, Andia sold 68 million fine ounces of silver, but that the sale was spread ver three years. The impression Gonveyed by these figures will be! Gnaceurate unless the veadar is informed that Indip disposed of 35 million ounces in 1929 besides mint ing in Bombay 16 million ounces for Hongkong order. Here is a total 51 million ounces in one year. This enormous amount sold in so short a period disorganised the market. The decline has been steady since that period. *Tt is well known that the Indian Treasury wished to forestall France in this matter. It was well known that France proposed to scrap the: perfectly honest silver currency Indo-Chine. Really, there was a. mind competitive race between both interests—each eager to obtain a. better price than the other.
'Actually (as Bir. Hattoniso clearly' and beautifully demonstrates) we fare witnessing an unhappy repetition of what occurred in Europe when Germany demonetized silver in 1873, Dr. J. H. Hollander a noted American economist. presents the facts pertinently and clearly; this great authority summonses the results of this action in these words:
"The grave error was that the disposition of the stock of silver should have been treated as a purely national concern without regard to world consequences. The dumpit cof this silver without any international understanding resulted in a series of monetary disturbances that may be described. ax aatophie—the break-up of the Lat Monetary Union, demonetization of silver in the United States and a severe blow to the silver savings of India."
Truly history is repeating itself. Sixty years after the German perience we sce a repetition of the financial phenomena that crowded lose upon the "crime of 1873."
Let it be remembered that the commercial world of to-day is much more closely correlated than in '73. Not only commerce but also finance has made giant strides towards an international entente, 'The slightest injury to China or India has its' immediate reflex in Lancashire and Louisiana, In 1873 the immediate effect of Germany's action was to ewer silver values from 60 pence vier ounce to 48 pence.
Yet remained a substantial purchase power, To-day with we can estimate how the ing power of all Asin crippled, Oxenstjerna told on the eve of his European tour: "My boy, go forth and see by what fools the wor " Traly the cynicism is as applicable to-day us in the period of that great Swedish chancellor.
Sir George Schuster was not unmindful of the fact that India was. releasing forces that she would be unable to control. lis words quot ed by yourself are pregnant with implications: "I am prepared to way......-if the other interests con-corned show any desire to consider the possibility of joint action that the Government of India would willingly ce-operate." Sir George was fully seized of the groat risks that were being run by the action of the Indian Treasury. THe even invited response from other silver interests. This was merely a gesture! International action in such ters is not. difficult to obtain provided there is an honest desire {to obtain such cooperation. 1 claim that silver has a rightful place in the financial firmament. The present silver currency of China is me finitely more honest than that of many European countries with their wretched depreciated paper. Compare the Sterling silver coinage of Ching with the base alloy ised the British mint. For several years|be said, as they represent England has been coining a composition that in the words of one prominent numismatologist basest metal used since the invention of the coining press." And the result? Not only China but also is effectually crippled as purchaser in the worl Is it any wonder that the line" of starvation lengthen: Europe? Can we really express an honest surprise that six million workers are unemployed in the United States? Asia contains balt is world's population. The liberate action of Great Britain, India and France in discarding silver with the poor faint hope expanding their holdings of care~ fully hoarded gold is really responsible for present-day conditions. Until Asia's power to purchase is restored there can be on economic: relief for Europe. That power to purchase will return when this mad competitive race to sell silver at. any price is ended. Remember, it can easily be ended by an international agreement that could be made effective ina few hours. Let us all hope that sanity will return to the chancelleries and treasuries of, Europe. Unless a change comes swiftly we will witness a total collapse of the great and grand edifice of European civilization. 'That civilization is based upon' honest commerce which in turn rests upon honest currency. The world can absorb all the silver now produced if only a return is made to the use of silver as currency. Also the world can absorb and thankfully use all the sugar, tea, coffee, cotton, rubber, tin and wheat that is now being "restricted" by insane producing nations.
I write in some heat. You feel sure pardon my indignation. If only my words will produce some rational consideration of this subject then will I consider my effort justified.
Wnasat C. Cums Shanghai, July 15.
Text read from the printed page and cleaned; old type leaves the occasional error.