tions which I have collected and published, and which have never been contradicted, I have reason to say that China holds, at least 2,000,000 ounces of silver, which is a fairly large quantity, including Manchuria and Mongolia, and China lost $200,- 00,000 of silver in six months, which is not very heavy if you take into consideration that in the last 12 years we received $550,000,000 from foreign countries. But there was a lack of confidence.
You very often hear that Chinese balance of trade demands the shipment of silver. I agree that it does demand it, but I maintain that the amount shipped out is not in payment of the balance of trade except toa small extent. I would put three-quarters per cent. of what was going out to flight of capital—which means that once a panic starts it would be very difficult to stop it.
The Chinese Government were faced with the necessity of considering whether to let this movement go on, oF to stop it, and to stop this movement we had, in the minds of economists, and I am sure also, the authorities, two effects; first' of all to retain' the existing stocks of silver in China, and secondly, to stop the devaluation in prices. The Chinese Government has shown a great deal of patience—I admire their restraint—because they saw that money flowing out, and they recognized the flight of capital—not by foreigners only, but also by Chinese, to foreign countries, and they were in a difficult position, because it they were to let silver' flow out unrestrainedly, we would all wake up one morning and find we were on a paper basis, ie, the existing notes would be unconvertable and everything you have to buy or sell could only be done with paper money.
That was the position. I hold no brief for the Chinese authorities, and Tam but expressing my own opinion, which may be right or wrong. About ten days ago, another $25,000,000 were shipped out, and another nine and. one-half million were packed ready for shipment, and here it was that the Government stepped in, and the export of silver "stopped—I' will not say it was prohibited.
There were three plans for consideration before the authorities: the first was an embargo on silver, but] that plan was considered and' discarded, I think rightly, because an embargo may bring more disagreeable surprises than good. The second was a graduated scale of export duties, which has been selected and put into effect. The third was
Text read from the printed page and cleaned; old type leaves the occasional error.