To the Editor of the "Nontu-CaNa Dairy Nuwws"
Sim—"Merchant," who recently' lamented the uncertainties of trading in China due partly to fluctuate ing exchange, should welcome some optimistic views on the trend of silver as gathered from information in your columns, assuming, of course, that' the present writer's interpretation differs somewhat from that of your correspondent who was possibly feeling a little too gloomy on the outlook. a Prophets have been stoned and they have had to live on dust and ashes, As a change of diet they sometimes have to eat their own words. It is to be hoped that an. exception will prove to be the case fon this occasion.
First of all, it should be remem ered that the white metal is used and sought after in preference to paper currency issues by two vast ations, those of India and China, whose crops, present and
Anancing in silver. retent e good and require The large supplies in Shanghai will in part be required up country commencing early in October, jand also for the world's biggest int to begin operations in this city shortly as the central plant: for all China for coining dollars. The fact that a widespread dis-{tribution of silver currency creates wonderful and contagious confidence is not lost upon the minds of the Chinese authorities; and Mr V. Soong with his colleagues fil strain their utmost to get a circulation of silver to foster trade, jeoax the country's commerce back into a state of convalescence, and place it on the high road to permanent prosperity.
The unusually large stock of silver has not been costly, except to importers, in the incidence of trade, and ence exports, begin, jest, with imports less the tael can be expected.
To this end India will help, as ver at this juncture must look like a very cheap commodity to that country, being at the lowest point for fifteen years. Consider a moment that for a long time [excellent crops have been the rule, fntigation schemes and transportation by rail and road contributing to the country's "enrichment, con. {entment and political peace, and it would be a pessimist indeed who said India cannot absorb large, quantities of silver, despite the gold bullion standard and paper assness, Perhaps the Indian Government has gone too far in selling silver supplies and melting down rupees for sale of the refined merat abroad. If a miscalculation has been made itis quite likely to cause a big rise in the price of silver.
As so clearly pointed out by Mir. E. Kann, to whom merchants fare much indebted for the bright and lucid notes on exchange and its multiform factors, China cides tha world's silver position, and she may yet, in less time that Feople think, prove her powers of absorption and cause Shangh: stocks to shrink so fast that India will become alarmed at the diminish. ing supplies.
Peaceful conditions between Rus sia and China will prevail, and the sudden ud Eeans will cause exchange to rise.
Taxation on exports such as silky cereals and tobacco, it is sincerely to be hoped, will be kept within reasonable limits so as not to throttle the trade, In fact, if it [be not presuming on the prerogas of the Chinese financial authorities, it might be suggested that all forms of exports be free of duty, In keeping with other ountry's experience, China would then flourish and pay for all ports with a be As the saying a bad itch, but it is not surance to predict ite around two shil= r the taely corresponding to the average for 1927 and 1928 which is only penny higher than the pre-war ten year average, It is a well known, paradox that exports are better ena rising exchange, but should fluctuate between 2s. 6d. and 28. 8d. it will hurt neither imports nor exports too much. It is absurd to expect a stabilization, so we must put up with these few pence Mr, Ki Custom: dom of being opti China, for the volume of tr grows year by year, although it runs in different channels, so let us "cence croaking, get on with the Job and make the bes: of things."
Tam, ete.
Text read from the printed page and cleaned; old type leaves the occasional error.