It is nothing new to say that the depreciation of China's subsidiary—coppers and small silver—coins has become a great problem. One has to visit the big Yangtze Valley centres of trade, however, to realize what a serious problem it is and how seriously itis going to effect trade if some remedy is not devised at once. Shanghai groans under a great commercial depression. Many big Chinese enterprises as well as many old and deeply rooted foreign hongs are frankly in difficulties. In the river ports one hears very little of this. Hankow for instance appears to be doing handsomely and while there are many plaints of the interruption of trade through disturbances in the interior which block the avenues of commerce and of a general break down in good faith and commercial morality, not only between Chinese and foreigners but between Chinese and Chinese, everyone is ready to carry on cheerfully while there is peace without fear of much of anything except the money market.
Mints have always been a source of revenue to provincial officials, but while the potentates were content with a modest and moderate squeeze, coins a little under value, if not too numerous, were accepted as notes are accepted and no one suffered. It was Wahg Chan-yuan, lately Tue chun of Hupeh, who set the fashion of turning out scandalously low-value coins in enormous quantity, thereby foisting them upon the local public, and shipping them, freight free, into provinces near and far for paying his troops with them and the purchase of good silver dollars to stow away in his personal strong box. Now everyone is doing it. Hsiao Yao-nan frat had to keep Wang Chan-yuan's mint running along Wang's own lines to meet the heavy demands made upon the Hupeh treasury for the upkeep of the Wu Pei-fu legions. One of the weak spots in this game is that after a time the depreciated subsidiary coinage begins to come back into the provincial treasury in the form of taxes. There is only one remedy for this from the official point' of view and that is to pay everything in bad money and collect everything in good. Nothing is calculated to make an official more unpopular than this. Everyone from the farmer to the big employer of labour feels it at once and resents it with a ferocious resentment, for vhere the smal] coinage has depreciated as it has in Hupeh, it is equivalent to a doubling or trebling off taxes. Hsiao Yao-nan understands this and hesitates to force this policy upon his province, but the demands from Loyang get bigger and bigger as Wu Pei-fu extends his field of action, and sooner or later it will he applied.
While Wu Fei-fu therefore sits in Loyang scheming in a big way for the regeneration of China, he and lieutenants in the bailiwick which they control are inspiring the people to a degree of resentment almost unparalleled in China's modern history. Wu Pei-fu is busy now paying back to the native banks the loans which he negotiated a year or so ago.. He seems to have realized that his tax upon the Kin-Han railway left nothing for upkeep and threatened the well being of the line so for some little time he has let this source of revenue alone. He knows that he is making nothing for himself, he thinks that he is spending what he can get in the interest of the nation and he is meeting his obligations. So, wholly blind to the effect which this juggling with currency has upon the vital commercial life of the people, he cannot understand why he is not appreciated.
isewhere they are not so naive. In Anhui, for instance, the mint has been deliberately farmed for all that it was worth. When it did not make money fast enough through the issue of silver coins of fifty per cent. face value, it was mortgaged to politico-mercantile interests, until it is now practically a commercial enterprise, struggling for bigger profits daily by issuing worse coinage daily, until the Anhui mint has literally poisoned the money markets of all neighbouring provinces. Where the introduction of this rotten coinage is prohibited as it is in Kiangsu, the Anhui officials indulge in. the profitable business of financing the smuggling of bad local currency into new markets by small junks. The distracted natives of Anhui, who cannot go afield and buy with the only currency which now comes into their possession, have recently petitioned the Ministry. of Finance for relief. The result has been the despatch of special agents from' the Currency Bureau who in their investigations have found conditions bad enough but who can do little in the way of giving relief except to go from Tuchun to Tuchun wringing their hands and painting pictures of the awful end of this minting business, Obviously the fundamental solution of the problem is the abolition of provincial mints and nationalization of small coinage according to a fixed standard. This, however, presupposes an all-powerful and efficient Central Government, as do disbandments.and so many other things devoutly to be hoped for. In the provinces where the officials are deliberately farming the mints there is no solution except a change of regime or the exercise of enormous pressure on the part of the people. In the provinces, however, which are suffering from the sins of their neighbours as Kiangsu is, there is a solution. This consists in the issue of new currency of a reasonably high value in actual metal, secured by a silver reserve in the provincial treasury. Depreciated coinage could be bought up at actual metal value and the new coins, if readily exchangeable for dollars at their face value at the provincial treasury, could be introduced la every market within a very short time. If such coins were available as legal tender and for all Commercial pur-
Text read from the printed page and cleaned; old type leaves the occasional error.