Sir Frederick Leith-Ross Says China Was Compelled by Market Situation 'MHE rumours that the recently announced currency scheme of the Chinese Government resulted from an arrangement for a British loan or credit to China has led to an emphatic denial by Sir Frederick Leith-Ross, Chief Economic Adviser to H. M. Government, who, it is understood, authorized the denial to be published abroad. On the basis of that denial Mr. A. Ariyoshi's statement was made.
Sir Frederick has, he admits, discussed loan possibilities wit the Jay ese and American Ambassadors but, as he explained to the North-China Herald" last Wednesday, the Chinese Government had been compelled to take action by the market situation without assurances of a loan from the Powers, Nevertheless, to a country in China's position, a loan would be useful and it was hoped eventual lly that, with the ce-operation of other Powers, including Japan, some arrangement might be made.
Turning {0 the Chinese Government's currency scheme, Sir Frederick said that its general lines were of surprising, as the abandonment Of silver had been widely anticipated. What was surprising was the rapidity of enforcement without external support, It was based on the principle of self-help and he wished every success, The reserves held by the three banks constituted resources ssuflclent to tide the Government over Until the balance of trade became more favourable. For the success which $1,700,000,000 were in coins, sycee or bars, About 160° trade associations in Shanghai have sent a joint telegram to Dr. H. H. Kung, Minister of Finance, expressing their support of the new currency policy. The Chinese Chamber of 'Commerce has lgsued a, circular notice instructing the Bean and Rice Dealers' Associ tion, the Rice Shop Owners' Associ tion, and the Exchange Shop Owners Association to adhere sirietly to the the presence of a curious crowd Nov. 5. The shipment of currency of the scheme, he emphasized, reforms of the banking system, par-Heularly the creation of an indepen dent Central Reserve Bank "and. a Dalanced budget, were essential.
He admitted that these reforms, had been discussed with the Chinese Government as part of any currency Scheme and he expressed satisfaction that the Chinese" Government had' Uundertaken to put them into effect Mr, Nelson T. Johnson, the Amer-dean "Ambassador, that. day. told a representative of the Sie F, Let Herald" that "he had nothing to fy" at present bout the American the Mowarae he, monday forms. adopted by the Chinese Govment. Ste Johnwon Jet ate the Sime day for Nanking and expects to felurn 10 Shanghai of the end of the 'There are three. American, banks with branches in Shanghar~ine Uonat city Bank of New York, the Chase Bank, and the American' press' Company—and it was. tnder= ood that they were in communieation with their head ofoes concern Ing dhe' sits tion Demand For Notes, Following the enforcement of the new currency policy, there fas been persistent demand for notes issued by: the Central Bank, the Bank of China, and the Bank of Communica tie ions, which have been decreed legal tender. According to. an_ estimate made jat the Issue Department, of the Central Bank, approximately $7,000,000 in banknotes were taken! Out from the three Government banks, on Monday, the frst day, and a little Jess than this amount on Tuesday and Wednesday. The majority of these notes were supplied by the Central Bank.
These notes were given on the presentation of silver. or 60 percent. silver and 40 per cent. other securities, native banks, financial institutions, Individuals, ete, being the applicants. A large number of persons changed heir sliver fog notes at the Central Bank on the first day and the number was increasing on the following two days.
The silver stocks in Shanghai ending Monday were estimated by some Chi nese bankers to be more than $394, 000,000, of which more than 12 per gent. were held by the foreign banks According to a rough estimate by a Chinese banker, the total silver stocks in the country, including ornaments, were known to be $2,700,000,000, of financial policy.
Text read from the printed page and cleaned; old type leaves the occasional error.