ON CHINESE CURRENCY

PRELIMINARY REMARKS ABOUT THE

MONETARY REFORM
IN

CHINA
BY

Dr. G.

yiSSERING

PRESIDENT OF DE JAVASCHE BANK",

MONETARY ADVISER TO THE CHINESE GOVERNMENT,

WITH THE CO-OPERATION
OF

Dr. W. a.

ROEST

former co-manager of de

wissel- en effecten

bank" in rotterdam,
acting as secretary.

Acting upon the advice of my late father

Dr.

S.

VISSERING

then professor of political economy at leyden university, and subsequently minister of finance in the
netherlands,

my elder brother
Dr. W.

WROTE AN ESSAY
THE

VISSERING

IN ENGLISH

WHICH APPEARED UNDER

TITLE:

ON CHINESE CURRENCY
AND WAS PUBLISHED

IN

1877

BY MESSRS.

E.

J.

BRILL LTD,

IN LEYDEN.

WAS AN

ACCOLTNT OF THE ANCIENT CURRENCY IN CHINA,

CHIEFLY GATHERED FROM ANCIENT SOURCES.
NOW THAT I HAVE BEEN CALLED BY UNFORESEEN CIRCUMTHIS

STANCES TO INVESTIGATE THE PRESENT CURRENCY PROBLEM

OF CHINA, I MAY LOOK UPON THE PRESENT STUDY TO A CERTAIN
DEGREE AS A CONTINUATION OF THE WORK OF MY BROTHER.
I HAVE THEREFORE GIVEN THIS VOLUME THE SAME TITLE

ON CHINESE CURRENCY
AND REVERENTLY DEDICATE MY WORK TO THE MEMORY
OF MY FATHER AND TO MY ELDER BROTHER

NOW

LIVING

THE HAGUE.

ALL RIGHTS RESERVED.

CONTENTS.
Page.
Introductory

PART

I.

Currency Reform.
..Memorials of the Board of Finance":
Ttie beginning of Chinese Currency

The present monetary

A coming monetary

Reform

situation in China

reform has to reckon with the following

principal circumstances

Meaning

of the terms:

Gold Standard, Gold Exchange Standard

and Silver Standard:

Gold Standard

Limping Standard

Gold Exchange Standard

10

Silver Standard

12

Banknotes as legal tender

13

Paper money (currency notes)

14

Advantages and disadvantages of the gold standard, the gold

exchange standard and the
Serious

obstacles

silver standard

to gold standard,

if

applied to China.

15

and gold exchange stand-

ard for China:

(a)

The consequences

(b)

The immense

territory of

conditions

various parts

Artificial condition of the

Many changes

in

of issuing token coins

18

China and the different

copper circulation

are to be expected in China

21

24
25

VI
Page.
It

is

questionable, not only

possible

if

it

to introduce at

advisable, but even

is

if

is

it

once one single system for the

whole of such a country as China

The

monetary system for China

best

27
the first twenty or

in

28

thirty years

AdTisable,

an

as

together:

and also

introductory

period,

to

have two standards

gold exchange standard as far as possible,

same time a

at the

silver standard

31

China requires as soon as possible an uniform currency, and,

as

as

far

practicable, a

monetary system with a stable

37

valuta

How

to start with a stable gold unit

and meanwhile maintain

39

a silver currency

unit

with

a fixed relation to gold should be selected from

42

the very start

How

to

bring such

tical

daily

use

a theoretical or fictitious unit into prac-

and make

transactions

it

a real unit for the calculation of

though

it

be

not

minted into hard

43

coins

The Amsterdam Exchange Bank

43

The Hamburger Giro Bank

45

The

great force of the

Amsterdam Exchange Bank was derived

from the institution of a bank guilder, which

in later

years

existed no longer as a coin but acted as a fictitious unit

and procured absolute

The bank, that
take

will

stability to all

act as a central

payments

bank of

issue, will also

the initiative of introducing such a bank unit.

The bank must

also be ready to

make

46

transfers in that ficti-

tious gold unit from one account to another.

The bank may be

The gold value
redemption

48

able to issue notes to bearer

of

these notes can be secured by offering a

in

gold value abroad

52

54

54

VII
Page.
It

thus be

will

possible

start

to

with various denominations

No government

paper money

a circulation of banknotes

in the

new

must be

fictitious

gold unit

issued, but a central

bank must have the monopoly of issuing banknotes

The

gold

unit

would be the

certainty

about the

figure at which the future real gold unit will be adopted.

The new

The

of 72/100

Kuping

are proposed,

new

unit of 72/100

prove a great mistake

down

coins

that

fact

would

tael

60

tael

to be feared that the adoption of this

Kuping

shows

large unit tends to

yuan

itself is

already con-

62

raise the prices of commodities, salaries

and wages and under

nerally
in

its

influence the cost of living ge-

shows a tendency towards a higher

countries with a smaller

The population

of China as a

level than

64

unit.

whole

is

not accustomed to dol-

64

lars at all

The obvious advantage

would be gained by a new

that

unit

67

of smaller size, like 1/3 tael

The question must not be put

even

under the

what

coin, but:

thus:

will be the

can be bought,

most suitable smallest coin

69

whole ?

reserves abroad and the balance of trade and of payment

Every monetary system has

to

come very

with these balances of trade

Balances

What

present circumstances, for the smallest

for the population as a

The gold

of

this

shipment

61

one thousandth part of a yuan

to

that the

sidered as too large a unit

59

60

unit to be selected

The proposed yuan"

is

57

great benefit which would at once be derived from such a

fictitious

It

55

of

70

closely into contact

and of payment

73

kind must sooner or later be settled by the

metal

73

VIII
Page.
Foreign reserves will

It

in

the

same degree be

affected by the

final

settlement of these unfavourable balances of trade

or of

payment

''^

would therefore be a necessity

China to know exactly

for

75

her strength as regards her balance of trade

It

would be a very dangerous experiment

or

to start with a gold

gold exchange standard as an uniform system for

the whole country, as long as

is the real position

it

is

these balances of trade and of payment.

This

makes

consideration

it

reserve

gold

foreign

equivalent

the

76

even more desirable to invent a

temporary scheme

The

which

quite uncertain

and strength of China with regard to

76

has thus been chiefly built up by

received against the issue of these notes

and must consequently be used for no other purpose than

for the

maintenance of their nominal value

...

Desirable to bring this reserve fund back to China.

How

80
.

to settle the

balance of trade or the balance of payment

gold

reserve abroad cannot yet be used for this

if

the

85

purpose

The

The

86

issue of token coins (Second Period of the reform).

issue

of

gold coins

91

94

Table of the proposed Chinese coins

The

seigniorage

profit

from

coinage

is

to

be

kept

as

separate fund

95

How

to maintain the gold parity of the token coins

The

subsidiary

coins

government

must always be exchangeable

several

96
at

the

98

offices

The government may encourage

in

84

the use of the

new token

coins

ways

Withdrawal of old dollars and cash (Third Period of the reform)

98

99

IX
Page.

Copper cash subject to

Some

different discounts

remarlcs about the foreign gold reserves

Conclusion to Part

Summary

103
107

of present currency

problem

109

proposed progress of the currency reform.

Outline of the

PART
Some

100

111

II.

further details about the significance of the gold exchange

standard system and

its

application.

114

Netherlands India
Straits

133

Settlements

Philippine Islands

135

British India

137

Comparative

Statement of Weight and Fineness of various

important

Gold and

Silver Coins and Units.

144

APPENDIXES.
A. Present Condition of Currency

in

China

The Tael

146

The

152

Dollar

Subsidiary Coinage
B. Present Condition of

153

Banking

in

China

Banknotes

155

Banks

156

C. Extract from Letter to French Consul in Batavia, concerning

monetary reforms
D. Synopsis of the

and

its

in

Borneo and Sumatra

Working

money

159

of the old ..Amsterdam Wisselbank"

of account

184

CORRIGENDA.
Page

9,

II

n'avait

pas

besoin d'espiier pour en-

treprendre, ni de rtussir pour persivirer.

When

Dr. Roest and

were received during our travels

monetary reform by M.
Georges Pallain, the most distinguished Governor of the
Banque de France, this gentleman reminded us of the
above motto, which the painter put at the foot of a portrait
of William, Prince of Orange and founder of the Netherlands state; M. Pallain expected that the very complicated
monetary reform of China would require from the reformers
an equal degree of perseverance. So he considered these
words a fair guide to our endeavours, even if we were not
I,

Chinese

in

the

to

succeed in finding the right

interest

Even a

of

the

way

out of this labyrinth.

be appreciated, because a
satisfactory one could only be obtained through various stages
of suppositions, each one verified by subsequent trials.
We are very happy to make these words our own device.
tentative solution should

my

appointment as monetary- or currency adviser

Government, in the first half of October 1911,
conditions have much changed, and the state of affairs is
even more complicated now than it was then. To the
different kinds of currency in circulation have been added
Since

to the Chinese

considerable quantity of newly

coined Chinese

dollars

and other fiduciary money trade

while debts and losses of
property have been increasing every day during the convulsions, by the lack of a central government which could
impose its will on the whole country. A very confused
state of affairs has been created, which means a bad foundation for a monetary reform which requires in the first
place a quiet population, willing to understand the high
as

well

as

banknotes

has almost come to a

stand-still,

purposes and the far reaching consequences of a reform of

the principal basis of their daily
relations;

and which needs

in

life,

and

of their business

the second place a strong

central power, able to control the execution of the

scheme

way and to act with vigour against bad

practices from people who would try to make illegal profits
out of a financial confusion. The best monetary scheme,
in

the

right

which would be most

become inadequate
Therefore

it

is

if

in the interest

of the people,

such practices were

rather likely that in

the monetary reform needed

by China,

left

would

unopposed.

the nearest future

will not, theoretically,

produce the best currency-system that could be invented, but

it might seem best to begin with such modifications of the
currency as would offer for the time being the best chances

and the best security for the government, for

every-day life, and for general business. This would last
as long as matters were not sufficiently settled and the public
mind, also in the interior, were not sufficiently developed to
allow the introduction of a perfect monetary system for
the whole country.
As past events have prevented me from going to China
to take up my work on the spot, I venture to put down
in writing some ideas, which may later on be of some
assistance in guiding the proposals for a reform.
Should
this be the final result after a time of pondering over and
studying these very complicated questions, I can only be
content with the unexpected delaj^ which the latest convulsions in China have caused in this matter, and which
left me the time to study those problems still more closely
and to talk the matter over with many prominent men in
Asia and Europe. I feel I ought to express my sincerest
gratitude and my best thanks to the gentlemen in Hongof success

kong, Shanghai, Tientsin, Peking, Berlin, Hamburg, London

and Paris, and to the American gentlemen I was so happy

meet in China and in Europe, for the kindness, with

which they explained to me their various views on currency
to

questions.


am

W.Jenks,
U. S. A., the learned and untiring
champion of improvements in the currency of so many
countries, with whom I have spent so many instructive and
I

particularly indebted to Professor Jeremiah

Cornell

of

University,

pleasant hours.

The views
developing

them with

my

of

these

gentlemen were of great value in

on this subject and in comparing
in our Dutch Archipelago during

my own ideas
my experience

occupation there, as President of the Javasche Bank.

In the last six years of

my

stay in the Netherlands Indian

Colonies several monetary reforms have been carried out by

Netherlands

the

according

to

Government

in

the proposals, and

parts

of

these Colonies,

with the co-operation of

the Javasche Bank,

The

following pages, therefore, will only offer some pre-

liminary observations on fundamental questions, which arise

in

studying the monetary problem of China; possibly they

may

induce those interested

more the

in

it

to carefully consider

Should these suggestions meet with

who will have to decide in
Currency Reform, they could, in due
into the more concrete shape of one
authorities

may

once

theoretical side of the problem.

ultimately find their

way

the approval of those

the matter of Chinese
course, be converted

or

more

to the Statute

bills,

which

Book.

Batavia, July 1912

G. ViSSERiNG.

PART

I.

CURRENCY REFORM.
MemoriaIs of the Board of Finance":
The beginning of Chinese Currency Reform.

The beginning
by a number

Currency Reform

of

of MemoriaIs"

Throne by the Board

rials

of

in

China

marked

is

which were addressed

Finance

in

to

the

Memo-

Peking. These

new currency act, for revised

Bank of Issue" and also for the
mints. They include a proposal for

contain proposals for a

regulations for the Central

reorganisation of the

withdrawing the coins and other forms

and intend

culation

to

of currency

now in

cir-

end to the irregular bank

put an

note currency.

These Memorials have been translated

into English

by

Charles D. Tenney LL.D., Chinese Secretary of the American

Legation in Peking and were published together

as ..Memorials of the

Currency
printed
I

Reform".

This

by the Board

of

was a pleasure

was approved and

translation

of Finance in 1911.

to perceive that they contain

Currency and Banking Reforms

of these principles

that the

English

Finance relating to Chinese

have studied these proposals with great

for the

fact

Board

in

and

interest

it

sound principles

in China.

The value

does not. however, do away with the

course of recent events in China especially

necessitates the

revision

found to require

of these proposals.

few additions and

will

They
even

will

in

be

some

instances have to be modified, in order to give China the

benefit of experiences
countries.

to

With

make some

which have

lately

been gained

in other

reference to these Memorials I therefore beg

suggestions in the following

treatise.

The present monetary

Thus

situation in China.

Gold

China has had no real standard.

far

is

scarcely

used at aU, and silver and copper are almost the only bases of
financial transactions, as far as barter

The

no more customary.

is

kinds of dollars,

silver circulation consists of several

introduced

mostly

the

dollars,

pillar

Hongkong

dollars

by

foreigners,

Mexican

the old Carolus or

viz.

dollars

coined in Mexico, the

by the English in Hongkong,

minted

the British Trade dollars, formerly used also in the Straits

but expelled from

Settlements

Japanese yen, abolished

in

1906, the old

since

there

and various

Japan since 1898,

kinds of dollars minted by the Chinese.

However, the
is

of

circulation of those several kinds of dollars

minor importance compared to the sycee which

among the

wealthier classes the principal

is still

medium of exchange,

in the ports as well as in the interior of the country.

These

sycee bars of silver are weighed and tested as to their real

intrinsic value,

settled

by

far as transactions are

having a true

sycee, they can be considered as

In

silver basis.

and accepted

The

and consequently, as

many

cases the silver dollars are also weighed

at their content of silver.

calculations become, however, even

more complicated

since dealings are for far the greater part

in practice,

culated in a fictitious unit, the tael; the tael

but only a weight; of this tael there are

is

hundred

same

in

city,

the country,

varying

It is

The only

real

more than a

from

to

in the
1

per

therefore impossible to speak of

a single unit of value in China, as there are

hundred different

different

and often more than one

in their fictitious value

cent from each other.

not a coin,

many

kinds, of various degrees of theoretical fineness,

cal-

more than a

units.

currency

in the

whole

of

China

is

copper,


and the confusion

of copper coins

equally astonishing

is

This currency consists principally of the old copper cash,

originally issued at a value

years

new copper

1000

of

one

tael;

in

later

pieces have been minted, called one cent",

The

counting originally for 10 cash.

for

in

basis

the transactions of tens of millions,

calculation

of

nay hundreds

millions of the population in the interior of China

copper currency; but as there have been

many

of

this

is

issues

of

these copper coins, of various periods during the last 2 or 3

centuries,

and often

different

values,

of various sizes,

differing

same

ferent discount for the

which are circulating

among each

other and at a dif-

coins in several spots, the uncer-

tainty in the small dealings of the population

A coming monetary

at

is

appalling.

reform has therefore to reckon

with the foUow^ing principal circumstances:

1.

the

of several kinds of foreign dollars of

circulation

different size, which,

if

sent back, would no longer be ac-

cepted in the country of origin, as for instance the Mexican

dollars

and the Japanese yens because they are no more

circulation in their

Hongkong

own

country; the British Trade dollars and

dollars since the area of

necessarily include the centre of

which

will

culation
2.

therefore

also

monetary reform

Hongkong and

its

will

environs'

withdraw these coins from

cir-

the circulation of the Chinese dollars, coined by order

of the Chinese
3.

in

Government and some

the circulation of the sycee

t.

e.

of the provinces;
silver bars of different

weight and fineness.

All these kinds of

money now

sidered as bullion only, which

in use

ought

to

be con-

may perhaps form a stock of

new silver coins to be issued.

metal for the future minting of the

4.

in

the universal use of a great quantity of fictitious units

taels, in v?hich debts,

consequence of the various kinds of

taxes and salaries

etc. etc.

fication will

taels,
b.

paid,

have been contracted

loans

many

kinds of units

long run be absolutely necessary, and

will in the

a.

are

real unification of all these

this

uni-

have:

to fix the conversion value of all these

expressed in proportion to the

to stipulate that these

new

many different

unit;

proportions will be legally bind-

ing on both parties to existing contracts, between Chinese

themselves, as well
c.

new
5.

to

as between Chinese

and foreigners;

convert the foreign silver debts of China into the

unit

at

equivalent to the old indebtedness.

value

The immense

circulation

copper coins of

of

dif-

ferent sizes.

Here the problem

for silver can

much more

is

difficult

always be calculated at

and the several kinds

of dollars

actually used on the basis of their

its

than with silver,

intrinsic value,

and sycees are as a rule

own

value as metal.

The

copper coins, on the contrary, are not calculated at their

intrinsic value,

which

often next to nothing because of their

is

mixture with other metals of hardly any value and because

of their

very worn out condition; usually they are calculated at

a certain discount of the nominal value at which they have

formerly been issued, which discount varies considerably in

various spots.

Then, counterfeiting has been practised on

a large scale, especially with coins of a very base alloy, and

these counterfeit coins are often accepted at the

same value

as the genuine ones.

6.

the

widespread

circulation

similar kinds of fiduciary

of

banknotes and other

money, issued by real banks as

well as by private firms and individuals.


Even

China should not accept the system

if

bank with the privilege

central

be absolutely necessary
banknotes
will

from

to

of issuing

To

certain
it

several of these issues are not covered

ensure

to

notes,

degree

this

is

very likely that

by

sufficient liquid

This

being paid on presentation.

their

will

it

withdraw these many kinds of

circulation.

be a very serious matter, as

assets

one

of only

question can only be solved on the spot after a thorough

examination of the financial status of each of these issuers

of

notes.

It

questionable

is

if

general decree, enacting

the withdrawal of such notes within a certain limit of time,

will

prove sufficient to solve

question

of

important

and

the circulation of these

the

in

bearing

direct
it

is

system

as

problem. However, this

this

on

rather
will

period

first

the

the

of

selection

question

of

many

of

not so

is

has no

it

a monetary system

carrying

have been adopted.

notes

reform;

This

any such

out

question must

therefore be dealt with in a later stage of the reform.

In
the

order

to

prevent

diffuseness

we beg

to

refer

to

appendixes A. and B. for some further details con-

cerning

the

present conditions of currency and banking

in China.

What

is

to

be

understood by the terms:

Qold

Standard, Gold Exchange Standard and Silver Standard?

Let us

first

in this treatise

standard,

and

explain in a few words what

understand

silver standard.

Gold standard"
is

we

by the terms: gold standard, gold exchange

is

name

the

for a

monetary system which

built upon a certain coin, which contains a definite quant-

ity

of

gold.

All

the

coins of the system, whether

of silver, nickel, copper,

bronze, or

made

any other metal, are


made and expressed
which

a fixed relation to this gold coin,

called the standard coin.

is

The

in

various denominations of banknotes, as well as the

amounts

concluded in the country, are

of business transactions

expressed in a unit of account, which

with

standard

this

coin

(such

sterling in England) or

based on

is

either identical

is

and the

the sovereign

as

same

the

the

(as

German Reichsmark).
This -oid standard coin

is

legal tender for any

within the country, and in view thereof

amount
quantity

a large

of these

coins are kept in circulation, to enable cash pay-

ments

be made as much as possible

to

England and Germany may be

sovereign,

Germany with

the gold 20

the only legal tender coin

the other coins

lation;

act

ter of subsidiary

we

shall

modified form

as

an

Mark

piece.

the gold standard coin

coins in circu-

all the

auxiliarj'
less

currency and

pronounced charac-

About banknotes

coinage.

speak

among

more or

bear, without exception, a

examples

cited as typical

In pure gold standard countries

der

gold coins.

gold standard countries: England with the gold

of such

is

in these

as legal ten-

later.

of a gold standard

is

found

in

some

other countries, where some of the silver coins share

function

The

certain restrictions.
in

the

of legal tender -with the gold coins, but only with

free coinage of silver

is

suspended

these countries, as far as private individuals or institu-

tions are concerned,

imposed

limitations,

and the government

which

either

amount

also is

to

under

self-

an absolute legal

prohibition (as in the Netherlands, until the last modification

of the currency act) or to the fixing of a
to

be

altered

if

necessary,

maximum

coinage,

such as was decided upon

the countries of the Latin Union.

bj'


The gold
be

10

however, remains the real standard and

coin,

Such

freely coined for private account.

affairs in

France, Belgium, Switzerland,

francs silver piece (or five

by

side

lire

piece)

the state of

is

and Greece,

Italy,

the countries of the Latin monetary union,

is

where the

in

circulation,

either

(lire).

have the limping standard".

to

In limping standard countries the gold standard coin

found

five

also legal tender,

side with the gold standard coin of 20 francs

These countries are said

may

also

is

an important degree such

to

as in France, or to a lesser degree such as in the Netherlands,

where the gold coins are by preference retained by

the central

bank

in its vaults to

be used as a gold reserve

for the settlement of international balances.

Beside the gold standard and the limping standard there

is

another system called the gold exchange standard".

a certain degree this

a variety of

is

tlie

Such a gold exchange standard was not

new

vented as a

where

it

in

practice,

some coun-

had gradually developed, owing

to historical

local

scientific system,

and national

usances

new name

and only

The Dutch

in-

in

circumstances,
It started as

originally

used to be the name for an

It

currency which was found

actual state of
tries,

system.

To

limping standard.

characteristics.

for things, already actually

later

in

and has

it

years

has

it

grown

found
into a

been put into practice as such.

Colonies in Asia, the Straits Settlements and

the Philippines are typical instances of such a gold exchange

system, but
is

we

find that

not always the same, as

during practical
pose as a

use, or,

origin in these various colonies

it

has either gradually developed

elsewhere, been

adopted on pur-

scientific system.

There are
in

its

still

other differences

among

the various forms

which such a gold exchange standard may present

itself.

lifound

lt is

in countries

where currency paper

issued

is

by

the government, with a guaranteed value, but also in coun-

Netherlands India where banknotes are used as

tries like

fiduciary currency.

Moreover, a gold exchange standard

with

a circulation

itself,

of

standard

not incompatible

is

coins within the country

nor even of such standard coins as

remittance

to

other

may be

used as

countries for the purpose of main-

taining the parity of the exchange or of settling an unfa-

vourable balance of payment.

ard,

A proper gold exchange stand-

however, supposes that such coins are not actually

but that the currency, including banknotes or

circulation,

government currency paper, as

currency,

in

is

far

as

is

it

based on that

only, or at least chiefly, maintained at par

by

a gold reserve abroad.

This explains
of a gold

why

various definitions are sometimes given

exchange standard system. In the

ments and

in

the Philippines, where

the purest application

impossible

to

of

bring into

this

system,

circulation,

we
it

Straits Settle-

find
is

at present

by no means

or at least to accu-

mulate a large supply of sovereigns or gold eagles.

were done

to

If this

such an extent that the circulation became

saturated with these coins, with the result that any

of silver token currency, of currency notes

and

of

amount

banknotes

could always be exchanged into those gold standard coins,

leaving

sufficient

number

of

gold

coins

ready to be

exported in settlement of international balances,

indeed

be

difficult

exchange standard system.

lasted there

an

actual

would

it

would

to recognize the remains of the gold

practically

As

long

as

these conditions

be no gold exchange standard

gold standard or limping standard, with silver

token money, would have taken

its

place.


Sometimes,

a gold exchange system

therefore,

a variety, with

12

is

only

a gradual difference in application, of a

currency system which

is

based upon a gold standard

really

or rather upon a limping standard.

would lead us too

It

far

away from our

plan for these preliminary remarks,

if

self-imposed

we were

to

go

into

further details about these matters in this part of our treatise.

However, the gold exchange standard, as a system, has

a particular importance for a country like China, where an

unmixed

application of a gold standard or limping standard

very likely be found impossible for the time being,

will

and

we

the

significance

and

its

We

shall therefore

devote

the

of

PART

to

application.

must only repeat

here,

for

the sake of clearness,

that, for the purpose of this treatise,

exchange standard every more or

a system,

of

volume

II of this

exchange standard system,

gold

country,

of

which consists

silver

token

we

less

complete application

a circulation,

of

currency,

within the

government

means

paper, or banknotes, viz. such

consider as a gold

currency

payment as have

of

not in themselves a sufficient intrinsic value, or no value

at

all,

and which are being maintained

at a parity with

gold not by an extensive circulation of gold

by a large stock

of gold

within the country, but by an

which

explicit gold reserve abroad, on

that purpose,

either

nor

coins

on term,

at

drafts are

sight

or

made

for

by telegraphic

transfer.

As
be
this
still

for

regards the silver standard" a bare mention will

sufficient;

not

many words

system, least of
in full action. In

any

amount,

all

are

required

to

explain

with regard to China where

China

we

it

is

find silver as a legal tender

and quite independently of the shape

 lain

which

offered,

is

it

coins, national or otherwise,

and sycee.

or as bars

For the sake

a

whether as

of completeness

perhaps useful to say

is

it

few words about ..banknotes as legal tender".

This matter

course has no special connection with any particular

of

monetary system, because any system

admit of bank-

will

notes receiving this qualification.

banknote

in

a form of money:

itself

and, consequently,

it

will only

it

only

keep

value as long as an adequate exchange value

fictitious

held

not

is

money

represents

and kept ready

reserve

in

ment.

It

force"

(i.e.

does not

follows

exist)

immediate reimburse-

exchangeability into hard cash

must as a rule be regarded as a very

medium

reputable

is

banknotes with a so-called cours

that

which the

for

for

its

which may only be

of payment,

dis-

resort-

ed to as an ultimum remedium.

thing.

by law
that

take

however,

qualification as legal tender",

ferent

If

is

character of legal tender

the

the

issuing

them

in

granted

bank

be freed from

will

its

declaration

of

For

this

obligation to

payment.

a cours force".

to

refuse

Of course

a duty and

it

its

this

in

duty remains entirely the same,

qualification as legal tender"

be allowed

imply

exchange, on presentation, for hard cash

and could only be abolished or suspended

self.

is

to the banknotes of a country this does not

legal tender pieces.

the

quite a dif-

in case of a

The only meaning

would be

that

of

nobody would

acceptance as a regular form of

means an advantage

as well as

would be binding upon every member of

community with the exception

The bank has

of the issuing

not a right to force

unwilling citizens as a regular

mode

of

its

payment

bank

it-

notes upon
for its

own


liabilities,

the

It

notes are

made

by such a

its

also briefly

governments

of British India

by the

and

is

of the Straits Settlements

banknotes.

If

by a metallic

this

also

still

in use in the

This kind of currency paper

lies its

is

constitutes a debt of

fundamental difference from

these currency notes are adequately covered

reserve,

which

their reimbursement, there is

and

is

government and

central

and herein

state,

is

now

is

at all times available for

no danger

for their deprecia-

the case in the aforesaid instances.

even imaginable that the exchangeability

It is

position

mention the paper money'' which

United States of America.

tion,

its

whether

notes would in no wise be altered

and by the Philippines, and which

the

of issue,

the form of currency notes, for example by the

in

issued

bank

decree.

must

issued

illusory.

legal tender or not, because

towards the holders of

We

to ex-

notes for metal or metallic value on presentation,

therefore immaterial to the

is

which governs

and which requires the bank

of its notes

its

would otherwise be made

its

for the stipulations of the charter,

issue

change

14

is

sufficiently

guaranteed without the special security of a metallic reserve,

viz.

of

when

so small in comparison to the credit

is

government as

the

doubt

the issue

is

the case in Germany, where no

can be entertained as

Imperial

Government

notes.

to

the convertibility of the

Moreover,

the

Reichsbank

pays these notes in gold.

Without

special guarantees of either sort, however, there

would be a serious
quence of fluctuations

risk

of depreciation, either in conse-

in the quotation for the

government

stock or else on account of excessive issues without

responding

measures to

cor-

secure sufficient ready cash for

their

exchangeability.

may

cite

before

15

As an

instance

of

the depreciation of the Italian

1898,

kind

that

we

paper currency

which has only vanished before the careful

financial policy of subsequent years.

Owing
is

to these

dangers of abuse and depreciation there

a general feeling against a paper currency without ade-

quate

metallic

established, the

community obtains no advantage from

kind of currenc)' which

ply

and when such reserves are duly

reserves,

it

would not

also obtain

of properly secured banknotes,

viz.

this

by a sup-

the advantage of

an easier means of payment.

After this explanation

Which

are

us consider:

let

the advantages and which the disad-

vantages of the Qold Standard, the Qold Exchange

Standard and the Silver Standard

Roughly speaking
ard

is

if

appHed to China?

the great advantage of the gold stand-

the stability of prices,

which

it

brings along for

commodities and home trade as well as for exchanges on

foreign countries;

rents,

salaries,

which necessitate payments

taxes and

all

such items

at certain instalments in a fixed

sum, will also have a fixed and certain value trade relations
;

with and debts to foreign countries will be settled in amounts

which are fixed from the beginning, with the consequence that
neither debtor nor creditor will have to face the risk of an

adverse rate of exchange, by a rise or a

metal.
for

The disadvantage

some time

to

is

that

at

fall in

the price of the

present,

and perhaps

come, a gold coin will be far too big a

unit for the ordinary transactions in the interior of China,

so that for

many

insufficient to

years to

come a gold currency would be

meet the needs

of the

be impossible to maintain gold coins

country.

It

would

in circulation to

any

16

important extent and the gold standard would

exchange standard with

practically be reduced to a gold

a circulation of token coins of

silver,

None

to

dangers attached

the

of

therefore

nickel and copper.

such a circulation of

token coins would be obviated by the fact that in addition

token

these

to

some gold

coins

coins could perhaps be

maintained in circulation.

gold exchange standard has

the

advantage that

it

ensures stability of prices and of international exchanges

nearly

in

same degree

the

steps

be taken

coins

and

as a gold standard, provided

guarantee the nominal value of token

to

maintain the parity of foreign exchanges.

to

would therefore be necessary

to establish a central

It

power,

instance a government department, which would have

for

exercise control in this matter, or better

to

bank

be held abroad. Our special attention

this

in

still,

a central

wich would control a strong gold reserve,

of issue,

matter

of

gold

will later

on be required

abroad and

reserve

to

we

only

mention the subject here as one of the chief foundations,

if

properly managed, of the gold exchange system.

Another very important point must be mentioned here

applying

which also concerns the

possibility

exchange standard system

to a country like China.

The gold exchange standard

far chiefly
full

support of their
reserves

gold
China,
is

been applied by

this

will

country

to

herself,

nevertheless

gold

governments with the

countries. In those instances the

were mostly kept

left

a system which has thus

colonial

however, has no mother

therefore

system

home

is

of

but

in

the

country
I

am

be workable

home

countries.

behind her and

confident that the

in

China and that

needs not forego the advantages of a gold

reserve lying in one or

more other

countries.


Similar

instances

17

furnished by other entirily inde-

are

pendent countries, such as Argentina and Japan, and

to a

certain degree also by Russia. The Argentine Republic has

kept gold reserves

repeatedly

London

in

for her Caja

de

Conversion. Japan and Russia have kept considerable balances in London, Paris and other centres, during the war, one

reason being the necessity to have funds abroad for the payment
of interest to their foreign bondholders.

During the war they

have both been able to maintain their exchange

at

a parity

with gold and this success was largely due to those foreign
reserves. It is true that their intention

was

reserves

from what

different

it

when forming

would be

of China, but to a certain degree the principle

viz.

these

in the case
is

the same,

guarantee the smooth settlement of the country's

to

means

by

liabilities

payments

of

from

gold reserve

abroad.

The
is

disadvantage of a gold exchange standard

principal

that

it

is

always to a certain extent an

which requires a very close supervision

of the currency
It is
it is

after

real

to

artificial

itself,

be avoided.

and

without

any

such

a silver standard the

system

remains in

full

copper coins,

is,

be

that the currency can

value in themselves.

of this

system

a deterioration

an undoubted advantage of the silver standard that

not

Under

is

artificial

if

that

supervision

silver coins

But a very

the

same

look

left to

as

aforesaid.

carry their

own

serious disadvantage

objection of artificialness

force as regards the circulation of subsidiary

which cannot be detached from the

silver

currency.

Moreover, a silver standard does not procure any stability

of prices for commodities, contracts

In the following pages

we

and so

on.

shall further illustrate these


points, with a

18

view to the special requirements of the Chinese

community.
If

conditions

China were similar to those of Euro-

in

pean or American or even Australasian countries there

would
the

be

no

doubt

that

either

exchange standard

gold

the

ought

to

standard

gold

or

be recommended

as the most suitable system for that country, even to begin

But there are some particular circumstances which

with.

call

our attention and which would seem to render an immediate

introduction of either of these systems

impossible for China. For

very

difficult if

not

obvious that conditions in China

it is

are different not only from what they are in the aforesaid
territories,

but also from Japan and Siam and from the majority

European colonies

of the

in

Asia.

This accounts for two very serious obstacles which both a

gold standard and a gold exchange standard would be sure
to

encounter in China,

The

a.

viz.:

necessity of issuing token coins and the subsequent

difficulty of maintaining their parity with gold;

The enormous area

b.

variety

of

and

conditions

system which would

suit

of

of

China, which causes such a

interests,

that

monetary

one part of the country would,

for

the time being, be fully unsuitable in another.

The consequences

(a.)

of issuing

token coins.

A very weak point of both systems, the gold standard and the
gold exchange standard, especially as regards a country like
China, will be found in the circulation of token

and

in

copper,

which

is

inevitably

money

in silver

connected with both

systems.

token

coin

is

a coin, the metallic value of which

is


lower than
at

which

Even

it

in

19

nominal value

the

at

ought to be accepted

which

is

it

issued and

in circulation.

pure gold standard countries, like England and

Germany, a great quantity

of token coins in silver (and of

subsidiary coins in

and copper) must be issued

nickel

provide for the small payments in every-day

life.

to

These token

coins and subsidiary coins must have an intrinsic value which

is

lower than their nominal value, and even considerably

as long as prices of silver

much

done

as they have

and copper continue

in the last forty years.

so,

to fluctuate as

For

if,

during

a rise of prices, the market value of the metal contained in

these coins were to
face value, they
bullion,

The

become only

would

at

slightly higher than their

once be melted down and be sold as

and a very serious stringency

Straits

Settlements,

certain extent

Mexico can

they had to endure

mone}^ would occur.

of

the Philippines and

tell

were compelled

demonetize their heavy coins and had to issue a

much lower

of

intrinsic

to

about the annoyances which

at last, they

until,

also

value.

It

will

new

therefore

to

type

be an

absolute necessity to establish a rather broad margin between

the real and the nominal value of such token coins, which

margin,

however,

counterfeiting, even
full

will
if

of

this

mean

a large profit on

the counterfeiters should use the

weight of fine metal as

Of course

course

is

same

contained in the legal money.

counterfeiting must be prevented with

the energy which the government has at

heavy punishments should be

inflicted

its

all

command and

on the forgers, as

they are a great danger to the credit of the state and would
cause widespread disturbance of economical conditions.

For as soon as the amount

circulation

entirety

reaches

of token

a point where

it

money brought

into

can no longer in

be absorbed by the ordinary requirements

its

of the


community, the surplus

20

debasement

will cause a

of the

whole

circulation of token coins.

In

such an event the government would have to choose

between two

money

counterfeit

have

evils:

first

at

would

venting the

its

have to withdraw the

either

nominal value or

full

consequences of not doing

to face the

The

would

it

of course

depreciation

be an

but

would

it

so.

efficient

means

of pre-

would impose a heavy

it

burden on the government and

it

would mean

that the

treasury would pay the counterfeiters' profits.

The second

attitude, viz. that of not

mean

token coins, would

of

withdrawing the surplus

that the evil consequences of

debased currency would be shifted on to the community.

The community would consequently have

round

all

of prices of commodities,

rise

to suffer

from an

while salaries and

other fixed items, like mortgage interests, laeses and so on,

would depreciate

to the

same extent

as the

money in which

they had to be paid.

The
and

disturbances would of course extend to foreign trade

this

would be a new reason

for prices to

go upwards.

Man)' other serious consequences would ensue and their

importance might
the counterfeiting
It

exceed the original nuisance of

easily
itself.

follows that a token

government which

is

money can only be

degree of counterfeiting even

country,

against

and

the

at

introduction

of

to

by a

in the interior parts of the

same time

imports of counterfeit

government were

issued

powerful enough to prevent a serious

fail

gold

in

to

defend

money from
either

standard

or

of
of

all its

abroad.

frontiers
If

the

these respects the

a gold exchange

standard would be an absolute failure and would entail the

most disastrous consequences.


The immense

{b)

21

territory of

China and the

dif-

many

cen-

ferent conditions in various parts.

China has been quite accustomed, since very

use of silver at

turies, to the

ny parts

even

the

larger

silver

Barter

common form
One of the

is

be the

in several parts as

monetary reform

in

many

fact that so

between the various

ports and the large

important

parts.

such as Peking and Canton, with

cities,

an extensive trade in
it

so low,

is still

might be perfectly suitable for the principal

system

but

on

ma-

found to be more

is

principal difficulties of a

differences exist

dities,

also carried

in

be used for any but

to

and copper

and

of business.

therefore

will

valuable

too

is

transactions

convenient.

intrinsic value,

of the interior the standard of life

that

China

its

might

many

at the

commo-

kinds of materials and

same time be

any

use, or

interior,

where

of hardly

perhaps even be quite unsuitable for parts in the

labourers and farmers form the majority of the population.

Moreover,

many

for

the

distances

an

effect

huge country, but

more or

still

those in other parts.

equalising

China are so immense

that,

come, the ideas and the wants of one

years to

part of the country are

from

in

likely to

remain vastly different

Railways, of course,

on the conditions of
this

result

life

have

will

even

in this

only be reached in a

will

less distant future.

gold

therefore

standard
easily

or

any system approaching

found

be

to

suit

certain

it

might

regions,

while

people in other districts would temporarily be better

were allowed
circulation

as

to

keep a

long

sound foundation.

silver standard, or

as this could be

As long

made

off, if

they

even a copper
to rest

upon a

as these differences remain so

22

pronounced, the carrying out of one single standard for the

whole country

at

once would therefore, no doubt, cause

many

in

those

troubles

such

and

system,

parts
is

it

to

some

the system, at least in

which are not yet

be feared, that a

parts,

fit

for

failure of

would be an inevitable

consequence and would entail disturbances of various kinds.

Many
on a

those difficulties could be avoided by starting

of

money

real silver basis: the silver

then always be worth

fancy for

Appendix

as

value,

A).

real intrinsic value, unless popular

coins plays a part and

certain

preciate in

its

in circulation will

The

makes them ap-

the case with various dollars, (see

is

intrinsic value

can every day be ascer-

The danger

tained on the basis of the world's price of silver.

of counterfeiting
of "counterfeit

would leave no

would be

would be much reduced, since the coining

good money," with the

profit,

and counterfeiting below

easily discernible.

need for maintaining a

value of

would be the only

also

be avoided

whole

intrinsic value,

nance

of that parity.

be settled

The
silver

basis,

and the

for the currency itself

the stock of silver in the country,

currency or

the silver in

maintaining the parity of the currency in foreign

exchange would

to

that fineness

Moreover, there would be no

fictitious

circulation, as the real value

difficulty of

legal fineness of silver,

in

for the mainte-

far as debts to foreign countries

metal they would be paid by

of silver bars

principal

to the extent of their

would form the security

As

from the stock

disadvantage,

and

have

export

of

in the country.

however, of maintaining a

standard will be the absence of a standard of value

of sufficient fixity. Consequently there will be no certainty

whatever for prices of commodities, contracts, debts,

rents,

taxes and so on, neither for the interior commerce nor in

business relations with other countries.

The amount

of silver


be paid

to

for the

the

entire

risk

same gold value

goods can vary ten

of

and ever more within a short space of

or twenty per cent,

time; foreigners

23

will

count

in their

own

a falling price of

of

money and

fixed

silver,

with a simul-

taneous decline in the value of Chinese exchange, will be

by

borne

the

merchant

Chinese

and cause

serious

handicap, which will jeopardise Chinese trade in the interior

as well as with foreign countries.
a

calculate

broad margin

as

The

an

creditor will

insurance

namely

premium

for

himself against an eventual decline of silver.

In that state of affairs nearly

all

the bad chances are on

the side of the country which uses the silver standard and

has to pay very dearly for

this

its

use of silver metal as the

only standard of value.

The
has
in

fact that in

led,

some

countries the use of a silver standard

during a certain time,

Sumatra and the

Straits Settlements, does not affect the

truth of this statement

ments have long been

the fact that

produce

b}^

to big profits, as for instance

exports
planters

for

in a

of

Sumatra and the

Straits Settle-

very exceptional position, owing to

tobacco,

tin,

and other

rubber

and merchants were almost entirely

confined to foreign markets, where these products were sold

and paid for

in

a currenc}- with a gold basis

as long as

these merchants and planters were on the receiving side they

were therefore protected by the gold standard

side,

they had to pay, they

had

to

pay

indirectly affected

if,

on the other

in silver,

payments consisted almost entirely of wages

and were only very

by

but these

to their coolies

fluctuations in the

world's gold price for silver metal. In fact the planters have
for

many

same

years since 1870 been able to maintain almost the

salaries,

at all events,

though

in a steadily depreciating currency, or,

wages have not risen

in the

same degree

as one


would expect with a view

24

to the fall in silver.

Therefore

these countries were nearly always on the profitable side.

Those

Asiatic

on

practically

her

border
turn

to

to

with

level

countries

where imports are

however,

countries,

except

exports,

China and

have been obliged

(Cochin-China),

gold or a gold exchange system, such as

Java as early as 1877, Japan from 1897/98, Siam

the

1908,

Straits

been

recently

and the Philippines since

Settlements

and the remains

1903/6,

expelled

of

from

a silver standard have only

from

those

parts

of

Dutch

the

Archipelago (East Coast of Sumatra and West Coast of

Borneo) where, owing to the above mentioned circumstances,
they had

There
the

still

survived.

is still

so-called

countries,

another circumstance, which weakens

the artificial condition in which the copper

viz.

connected with

circulation, necessarily

copper coins

along

same time

the

it,

copper
coins.

it

circulation
It

with

the

silver

circulation

with

the

intrinsic

follows that, though silver

money, the subsidiary coins

This

is

at

value of the copper

may be left to enjoy

its own intrinsic value,

and may be saved from the objectionable

be taken as token

and

obviously impossible to connect this

is

the advantage of being calculated at

to

must remain. For

unavoidable to maintain an extensive circulation of

is

it

much

superiority of the silver standard for eastern

in

coins, at

qualities of token

copper must always continue

an

artificial or fictitious value.

particularly important in a country like China

where

so very large and even in

some

the copper circulation

is

places predominant.

The very worst consequences would be experienced

the

value of this token

money could

This has already been experienced

if

not be maintained.

in China, for in

some


parts

of

where copper cash are nearly the

country,

that

25

only coins in circulation, a serious debasement of these coins

taken

has

which resulted

place

must be attributed

This

of

quantities

fact

that

far

too large

coins have been allowed to overflow

copper

country, partly

the

the

to

a heavy depreciation.

in

consequence of excessive issues by

in

the authorities, partly by counterfeiting which could not be

they were not withdrawn by

Since

effectively repressed.

the central government they had also the effect of expelling

the

better

metal from circulation.

silver

remarkable that the serious

evils

It

which may

is

therefore

result

from a

system with token coins have already been witnessed

in

China, notwithstanding silver could be regarded as the real

standard of currency.
follows,

It

an

efficient

to

for

China

that

means

certain

even the silver standard has not been

such serious consequences, and

to avoid

extent

has already proved to be a failure

it

in so far as

has not been able to maintain the

it

nominal value of the copper token

Many changes

We

have seen

gold

especially
exist

are to be expected in China.

that each of the systems of a gold standard,

exchange standard, and a

advantages and

its

of the

ful

a single

if

in

the

has

its

fundamental differences which

between the several parts

differences

silver standard

disadvantages for a country like China,

on account

These

would

coins.

are

such

currency

present

system

state

of this

that

it

immense country.

seems very doubt-

could

be devised that

of affairs be suitable for the

whole country.
In a not very distant future, however, things

become

totally

different,

for

may have

China as a whole stands on

26

the border of a widespread development; one could call

it

thorough but peaceful revolution as long as acts of violence

So many things

are not committed.

will

ged by the various reforms, which are

have

out in the next 10 or 20 years, that

cult

to

by the

construction of railways, light railways and

The system

be carried through, and

will

foreign

and many other things

will

whole people must subsequently

but

last

not least

the

monetary

have an important influence on foreign

trade and will open

of

traf-

In politics the institution of a chamber

of representatives for the

itself

motor

suitable for

latter

of taxation

have to be revised.

reform

The

communication require a good deal of improve-

main roads, and making the

fic.

be car-

ver}^ diffi-

is

it

say what the ultimate consequences wiU be.

of

ment,

be chan-

likely to

ried

means

to

capital.

the possibility for large investments

will

It

not

fail,

to

either,

have

its

influence on the standard of wages, and on the conditions

of

industry in the interior, and will open up to the popu-

lation

number

new ways

of

for

earning

their

liveli-

hood.

All those events

a

will co-operate to

bring about in China

change of conditions, no doubt as great and intense as

the economic evolution, which has passed over Europe and

America

since the introduction of steam engines, railways

and telegraphs, and

will

on several

many

seen

very

is

come about and what

fusion
of

it

the results will be.

this

No doubt

con-

points cannot be avoided; disturbances

kinds must be expected in

similar

how

difficult to foresee

effects

in

many

cases

every country, western or eastern,

that has felt the impulse to a serious evolution.

Many

at-

wholly prevent these changes

tempts to postpone or

to

must be expected

no doubt,

and,

We have

some

of

these

may

27

prove successful for a time; but

in

long run

the

will

it

be inevitable even for China to associate herself with the

material development of

that

everywhere going

is

In the meantime there will be a period of transition

on.

which

in

All

some

parts will last longer than in others.

make

circumstances

these

it

more

still

difficult to

from the very beginning, a monetary system that

establish,

wiU

suit

all

reform

of

mankind

various situations. Moreover, any kind

those

will

take

itself

much time

to

carry

out

in

such an immense territory as China, and already for this

last

reason alone a period of transition would seem quite

even

inevitable,

if

it

had been decided

to introduce only

one single monetary standard system.

Considering
is

it

very questionable, not only

but even

ble,

these facts

all

it

if

possible

is

to

it

if

is

advisa-

introduce at once

one single system for the whole of such a country as

China.

European countries and the United States

have taken time

of

America

complete their evolution and things had

to

ample opportunities

for

settling.

Would

it

thus

not be

a mistake to expect that China, which extends over an area

many

times larger

than

that

of

European countries and

even that of the United States, could assimilate herself as

a whole to these

new

conditions in a period of only a few

years ?
If so,

the query must not be put thus

which monetary

standard would be theoretically the most desirable one for

China? but
will

be attainable

currency

what degree of improvement

nearest future? What kind of

in the first place:

will

it

in

the

be possible for China to maintain

in a


satisfactory shape?

28

Which

sj^stem

will

be the most ad-

visable one for China in the long run, even

must

adoption

will

finally:

some

be
be

it

postponed
possible,

several

for

in

its

general

years?

And,

if

the meantime, to combine

of the advantages of the best

even

monetary system with

the

existing

not

be introduced

at

once? In other words,

adopt

at

once

possible

to

state

of

affairs,

beginning at a

final

some

and thus

very best system

this

this best

if

the

of

system can
it

be

good parts

of

will

aim from the very

to

introduction of this very best system

as a whole?

No

doubt

it

is

Still I

believe that

and

am

very
it is

difficult

to

solve these problems.

possible to find a satisfactory answer

confident that the experience of other times and

other countries will serve as a guidance

to find a solution in a practical

way

when we endeavour

apart from any theoretical

preference for one currency standard over another.

also

be found useful

recall

to

some

of

may

It

China

for the selection of a policy for

the lessons which were taught by the

currency reforms in British India, Japan, Netherlands India,

the Straits Settlements, the Philippines and Mexico.
I

suggest,

that from the present standpoint of financial

science

the best monetary system for China in the

first

twenty or thirty years

will

be the gold exchange system.

procure

manner,

it

culation,

and thereby ensure

will

stability

If

of

carried out in a skilful

the

money

in

cir-

stability of prices in the interior

of the country as

weU as in the financial

countries; at the

same time

it

culation of small silver, nickel

will

relations with foreign

supply an adequate

cir-

which

will

and copper

coins,


always continue

29

be wanted, especially by an Asiatic country

to

Consequen-

with a large population of rather small means.

tly

hold

the

opinion,

the ultimate object which a

that

present monetary reform ought to have in view

exchange system
token

of

coins

silver, nickel

of

a real gold standard,

be

to

desirable.

the country

This choice

itself,

in the

long run

in the

coins

Whether

this

by the

in-

be held

in

shape of a stock of gold, or whether

be held abroad to ensure the payment of gold

evident

is

a gold

be absolutely necessary to guar-

will

It

prove

this should

if

of a gold reserve fund.

stitution

it

and copper.

the nominal value of those token

antee

is

China with a circulation

of

exclude the possibility of adopting in later years

not

will

whole

for the

that

satisfactory

drafts,

it

measures should be taken to

protect this gold reserve from being exhausted to such an

extent

that

result can

In

the

exchangeability

the

endangered.

we

on

Later

shall

of token coins

would be

how

try to explain

probably be attained.

meantime

will

it

be necessary

to

maintain

circulation of silver coins circulating at their

free

metal

trinsic

value,

and

also

based as a kind of token coins on the

tion,

or,

as

basis

would already be

as this

far

of

gold

own

exchange.

silver circula-

possible,

the interior of the country;

in

on the

This copper problem,

however, must be solved with special regard to the

ation

a
in-

copper coins, the latter

of

only

fixed

this

it

circul-

might even be ne-

cessary to have, during a certain period, two kinds of cop-

per

currency

other

on

by

side

gold

side:

the

exchange.

one based on

Even

if

silver,

the gold exchange

system were introduced at once, the silver and copper

culation
if

now

in use

would

still

for a

only for the simple reason that

it

the

cir-

time be indispensable,
requires

more than a


few days

There

is

still

them

issue

to

in

another circumstance to be taken into acas

far

and

coins

money.

for the existing

As

count.

new

mint the

to

exchange

30 ~-

the

currency

silver

concerned, the

is

people of the interior are not accustomed to using dollars

as

coins;

those

dollars

are rare

where they do

places

the

in

accepted at their weight of

interior

circulate,

silver,

and even

in

they are generally

and consequently

also as

a small piece of metal, not as a coin.

Perhaps
places

will therefore

it

way

prepare the

to

money by

first

making

Would

it

of

real

as coins.

not therefore be

in

much

wiser to leave the exist-

circulation as long as they

in

use to the community, and even to mint

silver coins of the

some

for a subsequent use of token

ing silver and copper coins

are

in

the population gradually accustomed

money

to the use of silver

even prove advisable

same

size

new

also useful to the circulation

if

certain parts of the country (of course this should only

be done
theless

if

to

beginning,

it

were found absolutely necessary) and never-

combine,
this

as

as

far

circulation

silver

right

possible,

from the

with the principles and

the advantages of a gold exchange standard system

This

could

be done

for

instance

by

kind of connection between these two systems.

tion,

creating a certain

connec-

but not a fixed relation between silver currency and

gold currency; for before everything

express

quite

we do

not

distinctly,

wish to

aim

that
at

in

we

feel

making

we ought

this

to

suggestion,

any bimetallic system with a

fixed relation between the values of two freely circulating

metals,

both acting as standards.

Bimetallism in the old

scientific sense is out of the question for China.

nection

therefore must not

consist

in

fixed

The

con-

relation

31

between the values of gold and

sibility,

created by the government

banks and

cipal

exchange system
which continue

as

as

and by the prinfulfil

their obli-

to circulate at their intrinsic value.

an introductory period,

have two standards together: a gold

to

pos-

the existing silver coins

in

will thus be advisable, as

It

in the

the newly fixed unit of a gold

in

well

itself

companies, to

industrial

same time

gations at the

but only

silver,

exchange

standard as far as possible, and also at the same time

a silver standard.
In this respect an experience of

comes

Archipelago
ficially

adopted

to

our

the limping

exchange standard)

in 1877

many

years in the Dutch

Netherlands India

aid,

of-

standard, (or rather the gold

by

legally introducing the gold

10-guilder piece of the Netherlands as a gold standard coin,

and by fixing the

circulation,

silver

and copper coins then already

in

as token coins in a fixed relation to the gold

standard coin.

Sumatra and Borneo, however, many kinds

In

dollars

and even

wards remained

of foreign

rolus or pillar dollar, the

dollar,

the American

Mexican

peso,

the

after-

the old Spanish Ca-

dollar, the British trade

trade dollar in a small quantity, the

Indo-Chine

big silver Straits dollar, the

other kinds.

f. i.

yen (demonetized by Japan

old Japanese
Philippine

copper coins have long

circulation, as

in

of silver

piaster,

Hongkong

Not only was the

in

since
dollar

1898),

the

1903

the

and several

circulation of all these

kinds of foreign dollars unhindered by

many

official restrictions,

but everywhere in these regions they were accepted by

the

population

at

their

weight of

real

silver.

Therefore

the real silver standard was actually in force in these parts

and the settlement

of trade balances with

of the neighbouring countries

was made almost ex-

of the colonies,

some

32

clusively in silver currency

on a

silver basis.

to the relations with

until

Japan

and with China

1906,

898, with the Straits until

some years

until only

own

Private banks had issued their

standing

the

existing privilege

This applied

ago.

banknotes, notwith-

the Java

of

Bank (which

during a certain time raised no objections), and these private

banknotes ran

in silver dollars; for instance the

Trading Society issued

payable

in

first

own banknotes

its

Mexican and afterwards

the notes of the English

and

circulating freely,

banks

in

Netherlands

(called kasorders")

the

in Straits dollars;

were

Straits

of course all these banknotes

also

were

equally on a silver basis.

At the same time the government maintained in circulation

its own official currency, the silver and copper token coins,
and

eventually

banknotes

of

the

which are issued

made

and even
striction

the

to

the

pay

to

that

issue,

also in circulation.
its

government

pay by preference
companies,

shops

in

day

to

taxes and

be settled

For a long

dollars,

own

salaries in its

time,

to receive

in

how-

payments,

only with this re-

the rates were calculated a

of the

the

the Java Bank,

compulsory for

basis.

out, in silver

moreover,

coin;

government was quite willing

market rate

same,

were

it

Dutch guilders on the gold

ever, the

of

fixed and paid

payments

other

bank

in guilders,

currency and

official

standard

central

The government

all

gold

the

little

lower than

in order to induce debtors to

Dutch currency railway and shipping

and

other

private

institutions

did

the

with the effect that everyone could pay everything

with his silver dollars, be

of exchange.

it

with a small loss on the rate

For larger payments

exchange

to

loss,

--

33

it

was

dollars

usual, in order to save this

Dutch currency with some

for

native banker or at one of the exchange banks, and to effect

the

payment

notes.

the

for
to

The

ship

of taxes etc. in

was

result

Dutch money or Java Bank

instance that

for

Chinese lessees of the opium and

dollars to

their

bankers

salt

profitable

monopolies

Singapore and to buy

in

Java Bank notes from these bankers

at

was

it

which the government would have accepted their

Smaller payments, however,

tions,

and

for

as for

from guilders,

in

which

rency most of the companies' accounts were kept.

Bank
prices

silver

notes were rather

were often quoted

more common.
Dutch

in

from the

many

Straits.

familiar with this situation

culation of dollars into guilders,

Of course

and

as a monetary system

persons

cur-

Very

Therefore, though

guilders, actual

in silver dollars, dollar

paper-currency

had become

sta-

token coins were seen in circulation, but Java

were as a rule made

dollar

dollars.

on railway

tickets

commodities in shops, were usually effected

in dollars, after a calculation

few Dutch

than

at a better rate

bad

felt its

banknotes or

Every inhabitant
and with the

cal-

of guilders into dollars.

it

was a bad

and therefore

qualities,

payments

one,
it

and

had

to

be abolished as soon as the country was ripe for an improvement.

But

it

was a period

of transition,

and judging from

point of view the circulation of these

caused but

little

trouble to the

Besides, everybody

was

many

this

kinds of dollars

government and

to the trade.

certain to get his full value, the risk

of the exchange being only borne by the possessor of the

silver
in

dollars.

At

all

events this trouble was not important

comparison with the large profits made by the produ-

cing

companies,

who

paid

their

coolie-labour in steadily

34

depreciating

dollars.

These

considerably

through

the rise in

when

1906-7, and

wages had

the

at

companies found
in

the

of

silver

a rule been contracted and paid,

in

was

January 1906, the plantation

4d. in

2s.

difficult not to

it

adhere to the same figures

newly fixed type,

dollars of the

price

diminished

the Straits dollar, in which in later years

as

ultimately fixed

however,

profits,

for fear of trouble with

their labourers.

On

the

other

hand several merchants,

West Borneo, and

much from

particularly in

especially the Chinese traders, suffered

this state of affairs, since

they not only exported

produce to foreign markets, but also did a large importing

business for which they had to pay in gold, and therefore
to

exchange

they

their

were thus brought

They

medaille".

urging them

and

dollars
is

dollars

silver

at

an unfavourable rate;
la

to

as soon as possible

expel

to enact that the official

the foreign

all

Dutch money, which

fixed on a gold standard, should alone be tolerated.

Under

these circumstances there was, since the year

no longer any reason for the government

culation of silver

tinue in
it

de

to look also at the revers

sent earnest complaints to the government,

became even the duty

foreign

it

was

of the

clear that

from

government

coins over

which

906,

to allow the cir-

dollars and foreign subsidiary money

those regions, and

this

to con-

moment

prevent the

to

had no control

circulation

of

whatever.

Therefore the monetary situation was reformed

in

Borneo (1906/7) and

kind of foreign
of

money

in

it

Sumatra (1907/8) and every

expelled to the entire satisfaction

everybody concerned; even of the Chinese

were most accustomed

circumstance
lie to

is

to

the

silver

coolies,

a matter of great importance since

an apprehension that was

This

currency!

rather generally

it

who
last

gave the

felt.

For

it


was argued by many people
direct from

value

of

35

that the Chinese coolie, imported

South China, where he was accustomed to the

silver

dollars,

could never be brought to accept

a token coin, such as the Dutch guilder, of a

nings were heard

fear

for

troubles

officials

and

with

to

explain to

in

comparison with the

successful,
civilized

the

they

for

Chinese labourers.

way and took much

value

the

coolies

workmen

the

estate managers, however, colla-

borated in a most commendable

less

sides earnest war-

not to abolish the silver dollar circulation

serious

of

Government

ly

many

the big dollar pieces; from

smaller

perhaps even higher

size than the silver dollar, at a value

than

much

were

able

the

the token

coins

They were complete-

silver coins.

of

of

trouble

to

more

convince even the

certain value of the

guilder over the always changing value of the silver dollars

Whereas a general disturbance

murder

riots,

who

people

etc.,
still

of confidence, leading to

had been predicted by many conservative

adhered

to

the old silver circulation, the

reform has thus been carried out

natives

among

and the various other kinds

any real

difficulty.

induced to

accept

for their savings,

(1).

The Chinese
cheques

or

coolies

money

the Chinese, the

of orientals, without

could

even be

orders in exchange

when going home from Sumatra

to China,

and they found that these money orders were paid out by
the

Chinese

agents

of

the estates where the

money was

earned, and that from these agents they could obtain Chinese
silver

currency at the market rate of the day at their port

of arrival.

tomed

Consequently these coolies became even accus-

to the use of cheques,

which were drawn on a foreign

See about the execution of this reform an extract from a

from the writer to the French consul in Batavia in Appendix C.
(1)

letter

36

country where a different monetary system obtains

must be considered as a

monetary reform even among

of a

who were

not

able

to

(1

).

This

proof of the complete success

fair

less

educated individuals,

read or to write; such a result

could be obtained, because the reform had been prepared

with

sufficient

care

and was executed cautiously and

at

the right moment.

It

worth mentioning that

is

supremacy

of the silver dollar,

followed

ies

coolies

in

system

the

Sumatra, even under the

in

some

of the large

paying the

of

Dutch currency, and

salaries

companto their

that even during that pe-

riod the coolies never objected to accept these token coins.

So we

more

Borneo and

in

in

in-

for

than thirty years; not of a bimetallism, but of a gold

very

well

which these parts

this

Sumatra, the very

and existing side by side

simultaneous use

exchange standard along with a

on

in

circumstance of two different monetary systems

teresting

being

find,

together.
of

which went

silver standard,

During the

transitional

the Dutch Archipelago had

working arrangement proved very

period,

to

go through,

useful

and pract-

icable.

The

ard

the single gold exchange standard has been com-

to

pleted

final transition

silver stand-

without any disturbance or any difficulty whatever,

and has appeared

monetary reforms

from the use of the

in

a very

fair light as

compared

to the

in other countries.

great deal of trouble, for instance, has been caused by

the raising of the rupee to

s.

4d.

and

of the Straits dollar to

See about these matters my treatise and report to the Govof Netherlands India about the money circulation on
the East Coast of Sumatra, to be found as an appendix to the
yearly report of the Java Bank, year 1906/7, and the reproduction of such a money transfer or cheque in Appendix C. to the
(1)

ernment

present volume.


2s.

37

when these figures were publishsubsequent contraction of money and the falling

4d; nor did the trouble stop

ed, for the

due

of contracts

the fixed

in

which required settlement

money than

higher rate

previously in the silver currency,

have been the cause of many

and a great deal

at a

and even insolvencies,

losses

of speculation in silver prices has

nected with the transition to the

been con-

All these harmful

fixity.

consequences have been avoided in the monetary reforms,

by which

in the

Dutch Archipelago the

standard cur-

silver

rency was substituted by a fixed coin, not only at the time

of the systematic transition

from the

silver standard to the

limping standard in 1877, but also when, thirty years

later,

reform was given the finishing touch in the aforesaid

this

parts of Sumatra and Borneo.

This experience gives the right to ask whether similar

disturbances could not perhaps also

by

hereby eliminating as
lation

before

and during the period

would be especially important

where so much speculation

in

be avoided

way of remodelling the

much as possible the risk

selecting an analogous

normal

times.

Let

us

in

silver

to

China

currency,
of specu-

transition.

This

a countr)' like China,

in

try

of

in

is

already going on

give an answer to this

very important question.

China requires as soon as possible an uniform currency, and, as far as practicable, a

monetary system

with a stable valuta.

When
ought
soon

considering what conditions a currency for China

meet,

to

as

possible

we
an

run one with a stable

attain

ihis

ideal,

all

find

that

uniform
valuta,

the

this

country

currency
i.

e.

and

a fixed

money now

in

requires
in

the

as

long

currency.

To

circulation,

the

38

copper

silver dollars of different kinds as well as the

must be withdrawn and sub-

culation at varying discounts,

by fixed token

stituted

with as

little

cir-

and the change must be made

coins,

However, a

disturbance as possible.

circula-

be further expounded below,

tion of token coins, as will

will

only be possible after a satisfactory reform of the banking

system

including

China,

in

gold reserve, either

in the

the

creation

of

an adequate

country or abroad, or preferably

both; and, moreover, token coins can onl}' be issued without

danger

if

the central government

strong enough to pre-

is

Even

vent counterfeiting on a serious scale.

be found possible

whole country

more time than any reform

in

China

of

will

much

take

western countries during the

because several parts will not yet be ripe for

moment when

at

it

should

it

to fulfil these conditions, the carrying out

of the reform in the

last century,

if

in other parts the

scheme could

al-

ready have been carried out; therefore even under the most
favourable circumstances a long period of transition
vitable; during this period

it

will

is

ine-

be found absolutely ne-

cessary to maintain for a certain time the circulation of the

old silver and copper currency, side

Does

by

side with the

seem

new

token

coins.

begin

with intentionally admitting the co-existence of the

old

currency,

nucleus?

and would

it

not,

therefore,

simultaneously

Could

which would

it

this

later

with

desirable

to

new gold standard

not be the scientific basis of a reform

be completed,

in

one way or another,

not have the advantage that time would be

gained and that consequently the right moment could be

selected for settling the

many

difficulties

which are con-

nected with the gradual abolition of the old system?

it

Would

not also procure the best chances for a smooth working

of the process of transition?

And

finally, in

order to avoid


much

speculation as
to

aim

at

a certain

once

at

par will

at a

as

39

possible,

new gold

will

it

and

unit

to fix

so that speculation

value,

not be

beforehand

it

on

its

if

so,

advisable

future gold

be excluded?

Let us consider

how we

if

and

this is possible,

can start with a stable gold unit, and thereby

maintain a silver currency.

be argued that three ways are open

could

It

to reach

this result.

The

A.

first

way would be

the most

bring into circulation a token coin of

to

much

value

than

smaller

would be the
to

work well and

of

this

to

its

one,

easiest

common

one, viz.

an

intrinsic

silver, of

This system

nominal value.

and has

in

be very useful.

many cases proved

The great difficulty

system, however, would be that in China

be found very

difficult,

at least in the

it

would

near future, to pre-

vent an important extent of counterfeiting.

If

an adequate

support from the central power were not forthcoming and

and

if

consequently the unwanted surplus were not constantly

withdrawn, the silver coins would soon reach a serious disagio.

We ought therefore to
by

look out for another system, where-

danger can be reduced

this

dimensions.

Let us thus consider

ways would

suit

B.

but

new

with

an

to

the smallest possible

one of the two following

if

our purpose better.

silver coin could

intrinsic

be issued on a

silver basis,

value of 10 to 15 pet. less than

nominal value; a tax of an amount equal to

its

this difference

should then be levied on the production of the silver mines in

the

country and on

all

the

price

bullion

figure.

of

silver

similar

imports of
in the

silver, in

order to raise

country with the same

arrangement exists

in British India,

where

the tax on silver, which

sixth (or

been raised

10 or 15 pet. above

counterfeiting

of

to 5 pet.

to 4 d. per ounce, being,

metal would therefore rise

real value,

and consequently the

would leave no

profit as

by minting

counterfeiting

coins

long as

The danger

the fineness were not less than 90 or 85 pet.

of

about one

value.

silver

its

coins

ad valorem,

at that time of 24 d,

silver

6 pet.) of the bullion

China the price of

In
to

amounted

first

has, about a year ago,

with the price of

40

the legal fineness

of

would thus be avoided.

If

this

system

coins with an
their

as

were introduced there would be

90

intrinsic value of only

silver

pet. or 85 pet. of

nominal value but they would nevertheless circulate

silver

on

currency

subject to the

same

a silver basis,

they would be

fluctuations as the price of silver bullion

and would continue so

until the

a real token coin on a gold

When

e.

i.

country would be ripe for

basis.

the time for such a gold basis had come, this coin

could at once be fixed at a certain figure in relation to the

price

of

said unit

silver

of

the time

being.

would already have some

a token coin, because

its

per cent,

face value.

less

than

its

In the meantime the

of the characteristics of

metallic value

would be

or

This system would have the advantage, that the numerous elements of the

tomed

closely

to

Chinese population

follow

the

oscillations

who

are

of the

accus-

price

of

silver,

would gradually learn to estimate a coin at a higher

value

than

it

would be worth

were alone considered,

in

if

its

content of bullion

other words they would easily

become accustomed to the use of a token coin.

The parity with

gold could then be proclaimed at any favourable moment,

without

much further

difficulty, since these coins

would already


be

become token

to

fit

sufficient

in

from the

would already

coins and

numbers. The

moment

the proper

41

circulate

authorities could quietly await

to take this final step,

silver standard to the

and the mutation

gold standard would thus

be a very smooth one.

Some

rather serious disadvantages, however, are attached

proposal,

this

to

that until the parity with gold

viz.

been fixed the coin would circulate on a

steadiness of prices that

It

is

10

of

is

per

15

cent,

will

this

narrow margin

not encourage smuggling, or

whether the central power will be strong enough

payment

the actual

and

not procure the

expected from a fixed currency.

whether even

also questionable
to

silver basis,

new system would

consequently, this

that,

had

of the duty.

If

it

were

to enforce

would

not, there

be the same danger of counterfeiting as with a real token coin.

would

Besides, speculations on a future figure of the gold par

not be avoided by this system and contraction of

and prices would be possible as much as with a

money

real silver

standard.

But there
that

the

margin

another

is

when

viz.

10

of

and cause the same

bullion, as

and

the

serious

objection

15 per cent,

to

difficulties,

on a

Philippine

Islands.

same manner

This would be necessary

of

their

or

15

of

being driven
silver

pet.

system,

rise of the price of silver

China

Straits Settlements

would then be com-

pelled to reduce the fine silver content of

price

this

might prove too small

have been experienced by the

coins, in the

to

the parit}' with gold had finally been fixed,

to

rose a

But

this

all its

new token

as these other Asiatic countries.

in

the

little

order to remove the danger

melting pot as soon as the

more than

this

margin

would practical^ amount

to

of 10

another

currency reform, and the trouble of such a measure would


be

more annoying

far

in

42

China than

in the

much

smaller

communities of the Straits Settlements and the Philippines.

At

sight

first

main

attraction

plan seems very ingenious but

this

lies

in

the fact that

path to the use of a token coin,

is

it

would smooth the

government, however,

If the

strong enough to prevent smuggling,

be

its

it

will

probably

strong enough to prevent counterfeiting of a real

also

token coin; and

in this

event the adoption of a real token

would be preferable.

coin

Considering that the principal objections to a token coin

are

its liability

taining

its

par value,

it

sible to find a system,

As

avoided.

and the

to counterfeiting
is

necessary to inquire

selected

from the very

The nominal

new

it

pos-

is

way

we would

suggest

out of this difficulty.

unit with a fixed relation to gold should be

start.

value of this

new

a certain weight of fine gold, and

stability

if

whereby these disadvantages could be

a result of such inquiries

the following solution as a third

C.

main-

difficulty of

unit

would be equal

During the introductory period

unit.

to

would therefore ensure the

and prices whenever quoted

contracts

of

it

this

in this

new

unit

must only be accepted as a theoretical unit, such as for instance

a guinea

is

a theoretical or

the yen a theoretical

found
the

advisable

nominal

to

value

fictitious

money
actually
of

this

money in England, and

in Japan.

Later on

mint a real coin

new

unit.

The

it

ma}' be

in silver at

intrinsic

value

or the fine silver content of such a token coin could be de-

termined later on, because

this intrinsic value is of

importance than the nominal value; at any rate

it

minor
has no

influence as long as satisfactory measures are taken to pre-

vent depreciation, Consequently there can be no speculation

43

whatever on the declaration of the gold par, since

have been announced

this

advance and since the price

in

has no longer any connection with the

unit,

would

of silver

no more than

it

has any influence on the value of the shilling pieces circulating in England.

33

Whether

value

the

d.

the

of

silver

be quoted ad 22

English shilling

d.

or at

in circulation

is

always the same.

How

can

such a theoretical or

fictitious unit

be

brought into practical use and become a real unit for

the calculation of daily transactions though

be not

it

minted into hard coins?

Again

Bank

history can

show us the way.

Hamburger Giro Bank

the year

Amsterdam Bank

the

of

Exchange was

established in

609 by the city of Amsterdam, their burgomasters

to obtain a higher

coins were

Its principal object

degree of certainty and of

the settlement of financial transactions.

kinds of

Amsterdam

help us to find the solution.

being the chief managers of the bank.

was

old

Exchange (Amsterdamsche Wisselbank) and

of

This

The

stabilitj- in

Too many

different

They were

in circulation at the time.

minted by the government of the Dutch Republic, by several

provinces and even

were many

of the country.
of so

many

by

several towns,

foreign coins

was caused by
and

this

mixture

also of different

and much harm was done by the general

debasement which resulted from the issue

the

same denomination

size

and

coins

in addition there

mixed up with the ordinary currency

great confusion

coins of different nominal

intrinsic value,

and

fineness. In

of

new

coins of

as the existing ones but of a smaller

accordance with Gresham's law the better

were constantly melted down or sold as

bullion,

and

the lighter coins remained in circulation; but these lighter


coins were inevitably struck

by a depreciation, on account
Trade became seriously affected

of their smaller real value.

by

44

and especially the settlement

this evil,

of debts with dis-

due dates and of sales of foreign produce caused

tant

a great

deal

trouble since the creditor or seller never

of

knew what actual value he was going to obtain for his dues.
So the Amsterdam Wisselbank opened its offices for the
exchange
currency

of
of

those various kinds of coins against the real

the

country,

the

at

rate

of

the

day,

after

deducting a small commission; but they also allowed their

customers to be credited in the books of the bank with a

amount

certain

kinds

of

money

bank accepted

paid in had

first to

different

be transferred.

as a unit for their bookkeeping the

guilder of

silver

which the

of standard currency, into

gram

10,58

fine (10.582812),

The
Dutch

which was

reduced to 10.159884 in 1622.

The bank undertook

a

pay out the

to

credit balances of

customer in such coins as he wished to receive, and on

such occasion the bank guilders were transferred into the

kind of coins that were to be paid
a

small

In

the

commission

of

on both sides

course of time the standard

deteriorated further

which was 4 per

by the

cent,

and

issue of
later

The bank charged

out.

for

money

new

on again

intermediary.

its

of the country

coins, the real value

5

per cent less than

the value of the old coins in which the books of the bank

were
in

kept,

and consequently the old currency disappeared

accordance with the same law of Gresham. The bank was

therefore

no longer able

to

pay out

received and paid entirely in the

into circulation.

new

in

bank

guilders, but

coins which

had come

Nevertheless, the old bank guilders of an

intrinsic value of 10.159884

grams

fine silver

remained the

unit of account after 1622, and, consequently, after a certain

bank guilders had become a quite

lapse of time, the

currency no longer existing

fixed

as

to

The

were the only

community, as they

among

fictitious

but nevertheless quite

merits of these bank
to the trading

and unchanging

real

the ever increasing quantity of debased coins

This

circulation.

in

in realit3^

nominal value.

its

became every day more evident

guilders

unit

45

became the

is

the chief reason

excellence

par

unit

why this bank

guilder

trade

international

for

and why the Amsterdam Exchange Bank could render

such important services to the trade and to the whole community.
the

exchange were drawn and made payable

Amsterdam bank
drawee

as the

the

Bills of

from

Italy, Spain,

many

guilder so as to assure the drawer as well

in

which

enjo3''ed

way

for

nowadays a large part

as

owing

of the

its

to this particular character of the

accounts were kept the

the

London gained

Dutch metropolis

and established

coming

Amsterdam bank

a great prosperity and has long been a financial

centre to the world, until

wars,

Am-

financed through London in pounds ster-

is

transactions. Chiefly

over

was during

order to obtain a fixed financial basis for commercial

ling, in

has

etc.

through the financial centre of

sterdam, in the same

world's business

Part of the international trade

France, England, Germany,

3rears financed

money

be paid and received when

of a fixed value to

should become due.

bill

in

its

at

the ascendancy

the time of the Napoleonic

supremacy as a

financial

centre

centuries.

The Hamburger Giro Bank, which was founded

in

1619

on nearly the same principles as the Amsterdam bank, has

survived

adopted

the

use

of

many

Banco-Mark

the

circumstances
the

latter for

as

book

in

as

years.
its

The Hamburg bank

bank

unit

Amsterdam; by the

transfers

under similar

aid of this

bank

has become so familiar to the

population

day

this

Hamburg,

of

46

Hamburg

that

stands foremost lo

in tlie application of the giro system.

In the year

1876, when the Deutsche Reichsbank was established, the

Hamburger Giro Bank was amalgamated with the Reichs-

bank and has since become a Hauptstelle".

bank has given emphatic support

The Reichs-

to the traditions of this

giro system.

Thus
the great force of the

Amsterdam Exchange Bank was

derived from this institution of a bank guilder, which in

later years existed

no longer as a coin but acted as a ficti-

tious unit and procured absolute stability to all payments.

did not impair the merits of this arrangement that

It

payments,

they had to be effected in hard cash (which

if

soon became unusual), had

of money,
It

are

which

must not

be

to

lost sight of,

more complicated,

Bank had
standard,

be made

to

in itself carried

first

whether such a

in

China

(1).

however, that matters in China

because the Amsterdam Exchange

chiefly to deal with silver coins

while

some other kind

in

no fixed value

we have

to

fictitious unit of account,

and a kind

of silver

face the problem,

being a theoretical

gold value based on a gold exchange standard, could be maintained together with a circulation of silver on the basis of

a silver standard, notwithstanding constantly changing prices

of

the

silver

metal.

Nevertheless

feel

confident,

that

even under these unfavourable circumstances such a stable

bank unit can be maintained.

See further about the History of the Amsterdam Exchange
(1)
Bank, as far as it bears reference to the Chinese monetary question,
the first chapter of my article "La Bourse d'Amsterdam" published in the Revue Economique Internationale", and reprinte 1
as Appendix D at the end of this volume.
:


For, after

all,

such a

and even such a bank

fictitious unit,

known

has long been

unit,

47 --

China

in

itself.

In fact the taels are nothing else but fictitious units and

perform a similar function as the guinea

fees etc. in

prices,

shillings,

21

Many

England.

England are always quoted

and a guinea being

and a

in

in guineas,

would require a sovereign

it

shilling to find the necessary cash for a

payment

of

such a sum.

When

the

necessarjf

find

its

to

amount

weigh out a

in

China

it

is

certain quantity of silver, or to

equivalent in silver coins. In this respect a tael and

show much resemblance.

a guinea

Besides,

bank

such as those of the Amsterdam

units,

Exchange Bank and

also

must be paid

of a tael

Hamburger Giro Bank, have

of the

long been prominent in China in the shape of the

Newchwang
statements

with

Some

bank money.

or

transfer

regard to

this

unit

interesting

are contained in Mr.

H. B. Morse's highly interesting book about The Trade and

Administration of the Chinese Empire".

Newchwang

This

tael,

according to Mr. Morse,

grains of silver 992 fine, but except of copper there

there

least

circulation,

was before the

silver

last

war)

little

is

555.1

is (or at

of the metals in

being commonly deposited at the banks,

which permit removal only on the

first

days of the

third,

sixth, ninth

and twelfth months, but allow transfers from

account to

account.

used

in

deposit,

tor

is

mand

This

the settlement of

and

for

all

money

is

exclusively

mercantile transactions.

On

renewal on each quarter day, the deposi-

credited with a
for

transfer

premium which

money, but which,

ranges from 0.20 to 6 per cent.

in

varies with the de-

ordinary peaceful times,

Exchange quotations

also

are always quoted in transfer money, not in hard silver.


Tt

idea

seems therefore

much

that

the

extension of this

In China a precedent always counts

difficulties.

and

therefore

book

unlikel}'

a banco unit to other parts of China would meet

of

with serious
for

48

is

bank

unit or

argument.

powerful

still

with a view to this

suggest, also

would

Newchwang

unit, that

the bank, that will act as a central bank of issue, will

also take the initiative of introducing such a

The

bank

must

give

its

opening separate accounts,

of

Those

value.

in

silver

customers

being be based

new

based on a gold exchange system.

is

opportunity

units, as dollars, silver bars,

the unit in gold will be the

etc.;

which

unit.

in silver as well as in gold

will for the time

on one or other of the existing

taels,

the

bank

fictitious unit

As

a matter

of course the risk of a rise or a decline in the value of

ver

must remain

sil-

bank,

entirely with the customers of the

since the banking institution could give no guarantee what-

ever

for

of

stability

would lead the bank

should under

all

bars

some

paid

silver

in;

to a speculation in currency,

circumstances be avoided.

a customer brings his

dited in

the price of silver; such a policy

money

to the bank,

he

which

Therefore
will

if

be cre-

account for the amount of dollars or silver

and the bank

count in the same value,

will also

pay out on

this ac-

silver dollars, silver bars, etc.

viz.

In the meantime, however, the bank will be prepared to

transfer

any

credit

balance, either wholly or partly, to a

gold account kept in the

fictitious

exchange standard, but only

Such

gold unit of the gold

at the request of its customers.

a transfer from a certain kind of silver account to

an account kept

in the

gold

unit,

amounts of course

purchase of silver on the part of the central bank.

to a

The

49

bank must therefore be allowed

wholly

either

or

to refuse

whenever the amounts offered

partly,

might become inconvenient, or

check these offers by

to

buying rates for various kinds

raising

its

and so

on.

The same,

such transfers,

of dollars, taels,

of course, applies unitatis imttandis

to transfers in the opposite direction,

namely from gold

to

silver.

those

In

cases

ready buyer or

where the

seller

central

bank

is

not

itself

could perhaps act as an agent on

it

customers and try the open

market

behalf of

its

account.

An3^body who keeps a gold account with the

bank

central

have thus

far

be able

will thus

avoid

to

many

for

risks

been connected with the unstable value

to

guard against

this risk

by way

which

of silver.

Of course no opportunity has been lacking, even

past,

their

in the

of insurance, viz.

through exchange contracts with the banks; but the new

system which

and

is

hereby proposed

expensive.

less

This

will

system

of

no doubt be simpler

exchange

contracts,

however, which has had the effect of lessening the evils of

silver speculation in the past, leads us

exchange banks

bank

issue

of

customers.
step and
or

will

by

silver

expect that the

soon follow the example of the central

also

This would

opening
in

gold accounts for their

no wise prejudice any further

could be gradually extended over a wider area

among a larger number of clients.

As a rule the central bank will do

petition

to

with

local

transactions,

well to avoid com-

banks and bankers

but

its

policy

of

in this

matter of

regulating prices in

common interest of the countrj^ ought to be entirely free.

On receipt of instructions from its customers to that
effect, the central bank will also make transfers from one
the

kind of silver account to another, either between various

~
customers, or between

same customer,

50

accounts belonging

various

Kuping

as for instance from a

the

to

account to

tael

a Mexican dollar accout^t, supposing these accounts to exist.

Inasmuch as close daily quotations

of

and

taels

dollars expressed in the

be expected
if

for the various kinds

new

unit could soon

would simplify calculations and save expenses

it

the gold unit of account were also used for these transfers

between

The amount

silver accounts.

would then be converted

ferred

gold units and the

into

amount thus obtained would be transferred

account where

it

would

at

be trans-

of silver to

to the receiving

once be converted again into

the kind of silver desired, unless the receiving party kept

himself a gold unit account in which he preferred the

remain

to

In this

formity

(see also later,

manner

However,
termedium

matters

silver

as

will

with

certain

or

to

at

for

will

maturity

then draws a

bill

of

accepted

the

bill

bill

were drawn

is

the

cash

transfers

to

just sketched, will

where an

in cases

a rule be more convenient.

whether

date,

acquire
in

a buyer has to pay

months

in

in-

required the transfer or payment

remote due

be found

respect

we have

which

is

uncertain,

made payable
3

not

the bank's

of

remain chiefly theoretical, for

actions

of

is

The proceedings with

immediate settlement

instance:

advantage

principal

silver accounts,

therefore

in

be possible to obtain more uni-

different calculations of various kinds of

these

in

money

52).

dollars, taels, etc.

the

transactions.

between

will also

it

many

in

silver, as sycee,

page

But

this

great

trans-

be

date

stability

if

the

fixed

gold

unit.

For

certain

sum

at the

end

delivery of merchandise; the seller

exchange
for

at say, three

payment by

in silver currency,

months sight and

the buyer.

If

this

both parties would be


uncertain

quite

as

51

the real gold value in silver to be

to

In order to avoid this uncer-

received or paid at maturity.

be drawn and accepted: payable

tainty the bill can

gold

unit,

with the result that from the very

none

the transaction
as

to

The payment

receive.

would be

of the parties

he

was ultimately

itself,

however, can

the value which

first

day

of

ignorance

in

pay or

to
if

in the

to

necessary be

ultimately effected in silver on the silver basis; should the

price of silver

have

pay

to

have

fallen in the

maturity

at

an

closely corresponding to this

mean

time, the

buyer would

increased amount of silver,

decline.

On

the other hand

with a rise of silver the buyer would have to pay corres-

pondingly
the

bank,

less in silver metal,

at

whose

office

and

the

it

bill

account of the parties concerned, to

will

be the duty

made payable
make a transfer in
is

of

for
sil-

ver from the account of the buyer to the account of the

seller, equivalent, at

amount

of

the

bill,

the rate of the day of maturity, to the

expressed in the gold unit.

In this

way the parties who originally transacted the business can

commence and settle their business on a fixed gold basis
even in a country, where the only money in actual circulation is a silver currency (and of course copper)

ver basis.

in

meantime he

on the other hand

if

silver at maturity, since

have raised himself his

become

so

life

mean

will not necessarily

buying power of

much

every-day

silver,

it

he receives a smaller amount

rise since the

in

will

retail prices

accordance with the decline in the value of

seller

sil-

not necessarily be a disadvantage to the

It will

buyer to pay a larger amount of

in the

on a

larger.

as prices of

some extent a

the smaller or larger

amount

and

a loss to the

of silver in case of a

this smaller quantity will

Inasmuch

follow to

silver;

to

have

commodities

rise or decline in

be paid

will

have

52

a tendency to wipe out the profit or the

would

loss, that

otherwise arise for the parties concerned from the incidental

rise or fall of silver.

By

on these

acting

the silver transactions of

tle

though

very

in

still

bank would

lines the

ultimately set-

customers on a gold

its

way.

primitive

basis,

Therefore

this

plan stands in need of further improvements, and no doubt

the

bank can go much

be

able

that

the

efficiency

and

will

of

this

unit.

The bank must

in

this direction

in

considerably

increase

to

gold

fictitious

further

be ready to make transfers

also

gold

fictitious

from one account

unit

to

another.

There would be several ways

for

a customer to create

credit balances in such a gold account, viz:

pay actual gold

to

1.

into

bank,

the

either

on the

spot or abroad;
transfer

to

2.

certain

gold values

bank with the bank's agents

centres,

one

to

New

large

the

of

as Londen, Paris, Berlin, Brussels,

Petersburg,
3.

in

the credit of the

to

gold

Amsterdam,

St.

York, Tokio, Batavia, Singapore, etc.

a

negotiate

bill

exchange drawn on a gold

of

centre abroad, and payable in gold value;

through a transfer from the gold account of another

4.

customer

by

5.

selling

the bank

to

an amount of

or silver bars with the request to credit

for the equivalent.

with

the

The bank

restrictions

client,

or

of

it

acquiring

the

in
it

silver dollars

gold account

could then accept this silver,

mentioned on page

the purpose of selling

its

bis

for

market

48/9,

for

either for

account

of

account of the govern-

53

may

ment, on behalf of the mint; or the bank

keep the bullion

way

own account

for its

make purchases and

clear to

as soon as

prefer to

saw

it

its

sales of silver a part of

ordinary business, without taking to silver speculations.

its

As

long

buying and

daily

fair

will

maintained between

is

not be

mixed up with

no more than other central banks are

speculations

into

balance

bank

the

selling

speculations,

silver

led

as

by buying and

cheques on

selling

intermedium between buyers and

as an

foreign

countries

sellers.

The bank should

daily fix

its

buying and

selling

rates for silver in accordance with this policy.

We

along such lines

feel confident that

be possible now

it

new unit, based on

sum of these book

to start with a

The

exchange system.

total

or gold balances could be maintained at par

We

abroad.

shall

explaining more

would already

in

have an
detail

opportunit}-

how

a gold
credits

by gold reserves

further

down

of

these gold reserves can be

worked and managed.

A
of

book

credit

means

money which

away

either

in

owes a

that the bank_

certain

amount

the customer can parth' or wholl}^

draw

cash against a cheque or a receipt, or by

asking for a transfer to the account of another customer.

Such a

transfer has to

and the

transferer

means

of

credits

from one person

way,

viz.

still

by

ledgment

in

several

in the

names

to another in

whereby
If

it

book

an even more practical

issuing a certain kind of declaration or

writing,

of the

The bank, however, has a

further facilitating the transfer of such

credit balance to bearer.

in

be registered

transferee.

acknow-

undertakes to refund

this

such declarations are made out

denominations of the same amount, the credit

can be easily transferred from one person to another and

every

new bearer

will

be a creditor of the bank as long

54

as he holds this declaration,

and

amount mentioned

for the

therein. In other words,

may

the bank
which

be able to issue notes to bearer,

have much resemblance

will

On

central banks in other countries.

we may even

resemblance
treatise

to

call

banknotes of

to the

account of this close

venture for the purpose of this

them by the name

An

of banknotes.

im-

portant point, however, which distinguishes them from the

banknotes of other central banks,

any time redeemable

to

come

this

in

is

that the latter are at

hard cash, whereas

would not be possible

some time

for

in China.

In countries

England and Germany they are expressly payable

like

standard
silver

gold

coin,

and

elsewhere,

countries,

in

where

token coins are also in use as legal tender, they are

redeemable

in

gold or silver legal tender to any amount; such

for instance is the case in the countries of the Latin

and

in

in Holland.

Union

But as long as there would be no legal

dard coin in circulation in China, which

is

stan-

based on a gold

standard or on a gold exchange standard, the bank would

not

be in a position to redeem

cash of the same gold

unit.

its

so-called notes in hard

Nevertheless,

the gold value of these notes can be secured by

offering a redemption in gold value abroad,

which would make them nearly as safe as when

were actually redeemable

impossible to redeem
value; a note of

5,

in

gold coins.

each separate note

its

Tokio,

equivalent
etc.

in

course be

foreign gold

or 10, or even 100 or 1000 of the

gold units would therefore not

to

It will of

the)'

in

gold

in itself entitle the

values in

London,

New

new

holder

York,

but any amount of 50.000 or 100.000 of the

new

55

or multiples thereof, could be

units,

The

foreign gold reserve centres.

only have to be a

by remitting
bank place

in China,

would

of notes

trifle

actual gold

offer

made payable

such

in

exchange would

rate of

higher than the expense incurred

from these foreign centres

where the bearer

them

of such

to the

an amount

Of course

for redemption.

pri-

vate individuals will but seldom be in possession of such

large amounts of notes, but they will find that the banks
are prepared to

act

as

and

intermediaries,

this

will

no

doubt be sufficient to maintain the parity of these notes

with gold

The

(as is

shown more

in detail

79.)

p.

foreign exchange banks, and also the native banks

and bankers, may be expected

bank

tral

on

in

direction,

this

with the cen-

to co-operate

the

for

bank does not

central

intend to compete with the foreign exchange business of the

On

otlier

banks.

banks

in this business.

But the
free to
as

buy

much

se of
ests

its

the contrary,

support the other

will

central

bank must,

or

privately as well as in the open market,

sell,

foreign exchange as

own banking

of course,

is

remain entirely

necessary for the purpo-

view

policy, or with a

the government.

of

it

Such business

to the inter-

will not, however,

be done for the purpose of competing with others.

It

will thus be possible to start a circulation of

bank-

new

ficti-

notes

with various denominations

in

the

tious gold unit,

e\en though gold coins, or silver token coins based on

this unit,

As
with

have not actually been minted.

a matter of fact the same restriction must be

regard

circulation

of

to

such
silver

circulation

token

coins,

of
viz.

made

banknotes as for a
that

counterfeiting

can

56

be prevented; for as soon

counterfeited

ding

such

arise

in

circulation

consequence

certain

would

be

more

still

would

latter

own

value of their

bullion

much more

is

it

would be

and the disturbances that would

non-valeur of the paper notes.

that

as these notes

any important extent, the dangers atten-

to

with counterfeit coins; for the

a

But

it

serious than

at all events retain

against an absolute
is

a well-known fact

difficult to counterfeit well

made

notes

than token coins, and the danger of forgery in the case

of

notes

therefore

is

why

reason

considerably

This

less.

the

also

is

notes of a very small denomination, such as

one dollar notes, whether issued as government paper cur-

by a

rency

central

are

institutions,

ver}'^

where coins are

government or as notes

popular in Asiatic countries

upon with

often looked

be argued, that

therefore

banking

of

in

may

It

China a circulation of bank-

notes issued on a gold exchange standard would to

extent be possible at a time

even

(1),

suspicion.

when

some

the country would not

yet be ripe for a circulation of silver token money.

(1)

matter,

very interesting passage, which partly refers

December

31, 1911,

to this

Report for the Half-Year ended

of the Bank of Chosen (formerly the Bank of

contained in

is

the

Kiorea)

Another point of interest

in this connection is the considerable

expansion of the amount of one yen notes which stood at the

end of the year at Yen 10.501.700, which, compared with the
figures for the preceding half-year shows an expansion of
,,2.156.800

may

causes
the

or 70 per cent of the total increase in note issue.

note

account for this but the medu one

is

best

adapted

to

the

existing

is

Yen

Various

evidently that

condition

of

the

people".

(The
at

total

December

of one

amount
31 1911

yen notes

of banknotes issued

was yen

by the Bank

of

Chosen

25.006.540; therefore the percentage

in circulation is

very high).

57

No government paper money must be

bank must have the monopoly

central

issued, but
of issuing

banknotes.

We
if

have the conviction that

paper money

it

would be a great mistake

Government were

Chinese

the

instead

granting

of

issue

to

monopoly

the

issue of banknotes to a private institution,

to

be the central bank.

fact,

there

for

which would have

necessary to emphasize this

alreadv far too

are

for the

many

instances of the

consequences to which such government issues

disastrous

may

It is

governmental

lead,

by metal

covered

they are not completely

if

reserves for the entire countervalue.

We

need only refer to the French assignats and

American green-backs
been

again
posals

when
arise
It

discussed

fullj^

amendment

an

for

was

stress

laid

from such an

place,

c.

the

the

the latest pro-

German banking

evils

law,

which are likely

to

issue.

some

g. in

India and

of

to

that important issues of this kind

true

is

upon

relation

in

to the

and the subject has

as illustrations;

have taken

of the British dependencies, as British

the Straits

Settlements, but this could be done

without risk on account of the support of a powerful gov-

ernment and owing

pletely

to the fact that these issues are

covered by currenc}' reserves.

be dangerous

for

China

to start

on

It

com-

would, however,

this slippery

road of a

paper monev currency, the consequences of which, especially for a

country like China, would be difficult to foresee.

China's history

itself

paper currency, and

serve, that in
of

shows repeatedly the danger

in this

connection

it is

of

such a

interesting to ob-

853 the Chinese government resumed the issue

paper money which had not been used since the begin-


ning of the

two

kinds,

15th

The

century.

notes so issued were of

copper cash and for taels of

for

issue of both

58

was

The

silver.

forced, but they rapidly depreciated until

they circulated at only some few per cent of their face

value,
It

and soon disappeared from

is

circulation.

nowadays generally conceded

that a circulation of

banknotes which are issued and secured

a proper charter,

issuing

charter

Nor

there any need for fear that

is

would convey undue advantages

bank, for this charter

interest of the

accordance with

preferable to a circulation of govern-

is

ment currency paper.

such a

in

community

is

itself,

granted

the

to

the exclusive

in

in order to obtain a strict

guarantee with regard to the convertibility of the notes,

but also in order to avoid every possibility of confusion

between the needs

bank.

of

the treasury

The autonomy and

and the duties of the

the independence

must therefore be complete.

This was again very ably

December

pointed out in an article in the Temps, in

when

the latter

of

the latest renewal of the charter of the

1911,

Banque de

France was being discussed.

It is therefore intentionally

tes

of

an independant

be covered

in

Nevertheless,
circulation

to issue only

bankno-

which

have

it

must be always kept

is

in

if

to

in

mind

that the

connected with greater risks

than the mere keeping of book accounts

Therefore

will

accordance with sound banking principles.

banknotes

of

proposed

central bank,

in

a gold unit.

such a banknote circulation were introduced

connection with the bank-unit system of the former

sterdam Wisselbank,

more chances

for

this

an

combined system would

unfavourable

offer

experience

Amsterdam Wisselbank has ever been exposed

Am-

many

than

the

to.

Since the old Amsterdam Wisselbank system will not be suffi-


meet the needs

cient to

59

we must endeavour

of China,

to find

another solution with a wider range and more suitable to

At

the needs of this preliminary period.

all

events

we hold

view that probably a solution can be found by the

the

establishment of a gold unit even at a time

when China

not yet ripe for the circulation of a silver token coin,

is

based upon a gold exchange standard.

The great

which would at once be derived

from such a fictitious gold unit would be the certainty
benefit

about the figure at which the future real gold unit

will be adopted.

Speculations on the gold par and on the value of silver

would thereby be avoided, which

a very important ad-

is

vantage, considering to what extent business has been dis-

turbed in some other countries during their currency reforms.

Another advantage

by

once be

at

offered

foreign relations,

as

to

to

China, and finalh'

ernment

will

be the

will

to

to

all

who

as

sellers

government
in

which

will there-

contracting parties as well

act

the

no longer be

stability

or as lenders

itself.

The gov-

ignorance as to the actual

value of indemnities, and of salaries and other charges which

it

has to pay and of taxes which

it

is

going to levy; and

every other kind of business will be based on a fixed value,

which

will

no longer be affected by the shifting prices for

silver bullion.

the

In

basis can

which
will

is

meantime the
still

real

silver

circulation

be maintained for China as

very important,

if

on a

silver

far as desirable,

only for the sole reason that

be absolutely impossible

to

drop

this

it

currency within

a short space of time: every monetary reform will have to

reckon

with

the

provisional continuation of this currency.

_
Later on

we

thorougly with
like to

make

60

an opportunity for dealing more

shall find

problem, but

this part of the

first

we

should

a few remarks about the question of:

The new
The Memorials

unit to be selected.

of the

Board

of

Finance propose that the

Chinese Government would choose as a new unit a kind

new

of

word

dollar, called the

and

China),

in

,,3^

u a n" (from an old well-known

yuan would have the weight

this

72/100 of a K'u-p'ing tael (reckoned as 37.301 grams)

26.856
fine

grams,

silver

fineness

at

being

648/1000

Mexican
the

416

dollar

416

grains

trade

French

piaster in Indo-China 27

now

dollar

tael.

This

grains

= 27.07281

(= 26.956
(= 26.957

grams (:^

grams)^

grams), the
grams),

the

41 6.2/3 grains),

abolished Straits dollar (1903) 26.957 grams (416

expected that the population would

grains).

It

become

quite familiar

is

the similarity

the

K'u-p'ing

to the existing dollars, the

British

the

of

dollar being 417.15/17 grains

Hongkong

with these

new

at

once

yuans, because of

with the already existing dollars and with

tael.

As

this

new yuan would be

a rather big coin and rather

valuable for the very small transactions in the interior,

was considered necessary

subsidiary coins,

coin

e.

900/1000, the weight in

of

weight would be nearly equal

i.

of

viz.

were considered

have several denominatons of

a 50 cent pece, a 20 cent piece and

cent piece in silver,

and a

to

a 5 cent piece

in nickel,

a 2 cent

cent coin in copper, and since these coins

still

of the lower classes,

too big for the every-day transactions

it

has even been proposed to maintain

the present cash and to issue

5/1000 and

it

new copper

coins as small as

2/1000 and even as 1/1000 of the yuan. The

61

hope was further expressed that

1/1000 and 2/1000

parts

a certain time the

after

would prove

to

be unnecessarily

small and that the smallest coin in existence could be raised

to

the

the

value of 3/1000 or

coins

proposed

being taken

in

at 37.301

5/1000

of

a yuan. Therefore,

these Memorials (the K'u-p'ing tael

grams) would be:

ments and the Philippines by

new token

their large old dollar pieces.

the new ones are

The objections

much more
these heavy

unit.

inconvenient to

first,

carry,

too high for the purpose

is

especially

that

much inconvenience

cause

will

fear

are twofold

coins

which makes them

weight,

though even

satisfactory,

rather large.

still

to

and secondly, their value which

of

The

coins of smaller size which they substituted for

the old dollars proved

their

62

this

disadvantage

last

China and

in

will

have

far-reaching consequences.

The

now

already

to one thousandth part

How many

vexations

takes ten times

It

itself is

considered as too large a unit.

such a small coin as a

to

down

that coins

fact

yuan are proposed, shows that the yuan

of a

are

1/1

connected with the issue of

000 yuan

more work

to

mint these pieces than

mint the 1/100, and 5 times as much as the 1/200 of the

counting and verifying of these coins takes also

the

unit;

much

10 to 5 times as

was considered

although time
ideas

of

trouble as the 1/100 or 1/200; and

China,

this

of

value in the old

small

no doubt change, and perhaps

will

very quickly; and at any rate the work and the waste of
time

the

in

offices,

small

is

mint,

and

considerably increased

items.

by

the pieces are minted

If

easily

lost

government- and banking

by

the handling of such

Moreover, the expenses

transport are seriously raised

will

the

in

and

difficult

be impopular

if,

to

of

minting and of

issuing such a small currency.

of

a small

count and

size,

for

on the other hand, their

they will be

those
size

reasons

were made

such as to obviate those drawbacks, a couple of yuans worth

of this currency

would be very bulky, and the trouble which


now

63

exists in handling the copper cash

would be continued

under the new system, and perhaps on a more serious

The experience

Dutch Archipelago can be

in the

In former years the so-called duiten"

use in this matter.

were issued by the government; one

4 duiten to a cent;

there

is

and

the rate

many

quence of

has

is

their

years ago

one

of 6 to 7 to

troublesome (and are

which

sort

was only worth

and Lombok

in the islands of Bali

a circulation of the real Chinese cash, which

still

has been introduced

at

cent.

b}'

so in Bali and

still

Chinese merchants,

These coins were very

Lombok)

heavy weight: a value

of

in conse-

guilder,

2^/2

the ordinary gross piece of silver for those islands,

weight of about six kilograms when carried

scale.

also of

the

in

shape of these cash.

On

the other hand, copper pieces of one half cent, weighing

2,300

grams and being

been

issued

millimeters in diameter, have

by the Netherlands-Indian government since

1854; these pieces again are too small and therefore very

impopular on account of the danger

of

being

lost.

in

which they stand

Consequently their introduction has proved

failure.
It

be advisable for China to avoid both

will, therefore,

disadvantages and to abstain from coining either too small

a subdivision or too small a coin. Both these disadvantages,

however, would result from the proposed scheme, but they

are apparently

felt

as such

hope

is

after

some years and

expressed that

it

to

5 mill as smallest coins.

by the proposers, because the

will

be possible

keep only pieces

of

to

drop them

perhaps

3 or

This small and troublesome currency

would therefore only be accepted as a stepping stone

a

better

system, but

it

to

would not be an integrant part of

the best currency system that could ultimately be adopted.


Would

not, therefore,

it

64

to avoid these undesirable

be better

coins altogether?

large unit has

still

another inconvenience,

for:

a large unit tends to raise the prices of commodities,

and wages and under

salaries

of living generally
level

shows a tendency towards a higher

than in countries with a smaller unit.

a servant comes from a country where a smaller unit

If

prevails

amount

and where he used

to receive his

of these smaller units,

he

a country where the unit

in

is

wages

in a certain

will only reluctantly agree,

twice as large, to accept

he was accustomed

half the figure

It

influence the cost

its

to in his

former position.

a well-known fact that, relatively speaking, the cost

is

of living in a country with a unit like a franc or a

mark

is,

as a rule, lower than in countries with a unit like a guild-

a dollar,

er,

etc.,

though of course special circumstances,

as heavy import duties and so

on,

may have

a counter-

acting effect.
It

is

sometimes argued that people

could not be induced to use a

am

much

neous.

Generally speaking,

the population of China as a whole

to dollars at

are

taels, that

so

they

smaller unit than a

inclined to think that this

dollar.

China

in

accustomed to the use of dollars and of

argument

is

is

erro-

not accustomed

all,

since these coins are rarely used except in the ports and
their environs.

In the interior of China the dollar

as unfamiliar to the people as

any other coin

large majority of the Chinese population

and copper

cash, as coins,

lation. But, as

we have

and the

seen on

p. 5,

is

quite

of such a size.

still

use sycees

tael as a unit for calcu-

even the

tael is not a real


unit

inasmuch

65

apart from the various government taels,

as,

there are, according to Mr. H. B. Morse, over a hundred differ-

ent local taels, which are

all

generally recognized and

all

Appendix

A)

current. (Details about this matter are given in

The

majority of the population can therefore be said to

have no acquaintance whatever with the present

who do have an

however,

people,

dollars.

Those

occasional or regular

contact with those coins are either merchants, with foreign

who have worked

connections, or coolies

ments have,

therefore, to

customs; and

western

any

without

also,

abroad. These ele-

some extent become acquainted with

shows that they have

experience

themselves to other

adapted

difficulty,

Japanese 50 sen piece, the token

coins, as for instance the

coins of the Straits and the Philippines, the

Indian

rupee,

the

British

that

these

people will

size

than

the

tael.

2/3

of

new

basis,

must sooner or
coin

of

much

coin
is

new

or

basis,

a question

of

unlikely

value

than

issue

of a

ultimate

the

guilder,

of another

unit

another

to

on a gold

only

later

since

therefore,

is,

to

or

dollar,

Moreover,

token

silver

exchange

silver

It

etc.

object

Dutch

on a gold

time, the country

face the necessit}' of issuing a

smaller size than

new

a dollar and entirely

different in appearance. This

was

also the case, for instance,

when

the

Straits

the

government

of

obliged in 1907 to demonetize

been minted since

1903,

coin in lieu thereof the

its

Settlements

Straits dollars

weighing 26.957

new token

was

which had

grams, and to

coin dollars of 20.2172

grams, which have been adopted by the population at the

same value

as the former large pieces. It will, therefore, be

impossible to

maintain the preference

soon as the silver standard

It

is

also

is

for dollar pieces as

dropped.

argued that under a new monetary system


would cause

it

existing

argument.

such

one of

2/3

etc.

concluded

the

threefold

new

the

of

2/3

of

necessary to

come

between the old

English

to
of

be settled

in

3/2 of the

in

final result for the

not pay a farthing more,

settlement with yuans of 2/3

tael.

to a legal

which

tael,

and the new

tracts,

and the

would not receive a farthing

creditor

2/3 of

as for the debtor would be exactly the

The debtor would

same.

instead

unit,

tael;

this

of the

the existing contracts, debts,

would have

these taels

well

as

cannot understand

nearl}' equal to the

German mark,
in

proposed yuan

another unit were

if

new unit were adopted

Kuping tael in lieu of about

being therefore

and the

creditor

tael.

on,

instance a

If for

tael,

shilling

and so

debts,

about 1/3 of a

size of

with regard to the settlement of

trouble,

contracts,

adopted than

66

unit,

henceforth to be settled.

in

less

the

than under a

In both cases

will

it

be

readjustment of the relation

the basis of existing con-

is

which these contracts are

Whether

2/3 will

have to be mul-

by 3/2, or 1/3 by 3/1, or 1/2 by 2/1, this matter must

somehow be settled by law and the one method of calculation
tiplied

may be

just as well enacted as the other: the final result will

No

be absolutely the same.

new

unit

of

fear

need be entertained that a

about equal to the shilling and the

1/3 tael,

Reichsmark, would cause any disturbance

at

tions,

2/3 tael

all

events no more than a

would

somewhat

new

in existing rela-

unit or

yuan

do.

similar

change from one unit

to another

took place in China during the Taiping rebellion,

in

of

Shanghai and the Yangtze

basin,

on a fixed day

when

in 1856,

merchants' accounts at the banks were transferred, unit for

unit,

from

grains

of

a currency (the Carolus dollar) containing 362

fine

silver,

to

a unit (the Shanghai

tael)

con-


nominally

taining

some extent

To

grains of fine silver per unit.

525

may be

this

67

What, on the contrary,

looked upon as a precedent.

is

the obvious advantage that would be gained by a

new

unit of smaller size, like 1/3 tael?

The

advantage

chief

with

connected
coinage

dowrn

the

culation

that

all

many kinds

great

could

the

trouble

subsidiary,

of

be avoided,

for

it

sufficient for the requirements of the cir-

new

such a

if

be

1/1000 yuan

to

would be quite

would

were subdivided only

unit

in 1/10,

1/100 and 1/200. These denominations would then be equal

to 1/20, 1/200

and 1/400

proposed yuan of 2/3

of the

Without unduly exaggerating the subdivision as

very

similar

the

to

small

German and French

English,

subsidiary' coins, the 1/10 nearly like the 10

and a

down

they would seem quite small enough, and be

1/1000

as

far

tael.

little

pfennig piece

more than the English penny and the French

deux sous; the smaller ones

in the

same proportion.

The

great advantage therefrom would be that the country could

avoid

bad

the

polic}'

of

adopting a

with the intention of abolishing

on account of

many

In
2/3

tael,

1/2 of the

its

it

coin of 1/1000,

again as soon as possible,

objectionable natural qualities.

other countries there

viz.

new

the

shilling

is

a smaller unit than the

and the Reischsmark:

nearly

proposed yuan; the franc: about 5/12; the Austro-

Hungarian crown: about 5/12;

and

the

same

the Japanese coin, as the 50 sen piece, which

the small unit,

is

worth almost half a yuan.

the other hand, has the rouble, which

is

is

applies to
practically

Russia,

on

about equal to the

yuan, and America has the dollar with a value of twice the
yuan,

while the Philippine Government, the Straits Settle-


ments and Mexico have

of about 8/1 2 yuan.

is

the

as

pound

adopted a unit of about

whole and

and 6

this applies

find the rupee,

England

only to the gold system

to larger transactions: for the majority of

transactions the shilling

retail

shops for instance an object worth

in

unit;

but

we

true that the real unit in

It is

sterling,

domestic and other

shillings is

seldom quoted

.6.0.

used

is

pound

but generally

26/-.

has been argued that the transactions in the interior

It

of

finally

In British India, on the contrary,

yuan.

as

68

China are often so small that a small coin of 1/1000

No

yuan would be absolutely necessary.

that

some

not

the

bought

objects can be

from

question,

an

be bought

objects can

enough

considerable

to

it

true

is

yuan; but

for 1/1000

it

economical point of view,

at this price, but

importance of transactions

doubt

in

little

introduction

the

if

the economical

if

objects of so

justify

is

monetary system of such a small coin with

all

value
into

is

the

the atten-

ding disadvantages. There will always exist economical goods

of so

ple of

value that even the poorest

little

them

for instance,

it

man

will

would be impossible

buy a

to

multi-

pay the va-

lue of one match, or of one pin; therefore everyone buys a

of matches, a plurality of pins. It

can be
suffer
at

may be

that

at

a price of 1/200 of 1/3

the proposed yuan.

It

may

1/1000 yuan; but

it

will not cause

buyer, even to the very poor one,

purchase

with

need

the

meal, since

it

some
course

is

other
of

2 or 3 cigarettes

being 1/400 of

tael,

be that a helping of rice or of

be bought in the

can

vegetables

in

one cigarette

bought for 1/1000 yuan; the buyer, however, will

no serious inconvenience from buying

once

box

the

interior

much
if

things,

he

of

China for

discomfort to the
is

to

combine

which he

day or even

at

will

the

this

also

same

obviously impossible, even for the poorest


man
1

/1

69

means

China, to support himself for one day by

in

000 yuan. In the course of one single day he

be several times obliged

to

spend the amount of

and experience teaches everywhere, that

yuan,

of

will, therefore,

extent such expenses can be easily combined.

1/1

to

000

some

Therefore,

the question must not be put thus what can be bought,

:

even under the present circumstances, for the smallest

what

coin, but:

In

connection

this

most

will be the

necessary to consider the larger

is

it

government and

interests of the

who

suitable smallest coin

whole?

for the population as a

have

many

of the

other categories

of

persons

in

other words: the interest of the community as a whole.

It

might

coin

not
In

even

to deal with these small coins;

could

objects

the

tael

2/3

is

for a

however,

ought

the minting of such pieces.

for

kopeke

1/4

be bought

circumstance,

this

where the population

interior,

nearly

that

argument

be an

Russia,

the

be

1/5000 yuan;

of
to

will

very

poor

in

1,400 of a rouble

of

is

or

also

the smallest coin; in the Straits Settle-

ments and the Philippines the smallest coin

dollar

of

many
not

among

Chinese

2/3

of

1/3

of

and even

tael,

the native population

residing

there,

much higher than

so

1/200

nearly

also

not popular

in

is

worth 1/200
this

nor

whose standard

coin

among

the

of life

is

The

the interior of China.

a tael will have about the

is

same value

as

the smallest coin in Russia.

On
to

these grounds I take

all

start

with a

posed 2/3
erable.

tael

new

and

The adoption

unit

it

that

will

be much wiser

of a smaller size than the pro-

presume that

1/3 tael

of such a unit

that all existing contracts

it

running

in

would be pref-

would have the

Kuping

taels

effect
if

the


Kuping

new

times

niany

as

new

set of subsidiary coins,

such

of

were taken as a base

tael

three

in

70

an

would have to be settled

of 1/3 of this tael.

units

down

two-hundredth part

to a

could then be introduced from the very

unit,

and could be maintained under the new monetary

start

There would then be no need

system.

for abolishing

any

smaller coins later on as an undesirable part of the system

after its perfection.

now

Let us

consider the questions of:

the gold reserves abroad and the balance of trade

and of payment.

The

financial position of a people

so-called

its

These

two

now and

is

highly influenced by

balance of trade and

its

balance of payment.

things

in

character,

then

are

they

different

seem

although

to lead for a time to identical

conclusions and are therefore often confused.

The balance

of trade

is

compensation with the

in

formed by the exports of a country

other countries. This balance

the

balance

necessary

is

in

order

to

and the payment

pay

favourable
if

for

of bills of

if

imports from

the exports leave

the

imported
result

first

are

articles are

from the exports,

commodities takes place, as a

through the intermedium

by means

its

the latter exceed the

by those which

for these

of

The remittances which

unfavourable.

largely compensated

rule,

is

over the imports;

balance

amount

total

of

the banks, and chiefly

exchange and bank

transfers.

For instance, an exporter from China sells and delivers

his goods, say soya beans, to a

payment from
on him
the

this foreigner

this bill of

seller

may

by drawing

exchange

therefore be

merchant abroad and asks

is

a bill of

exchange

sold to a bank, from

which

said to receive his payment.


The bank, on the

71

contrary, receives

eign

buyer

on presentation of the

due,

through the intermedium of

payment

presentative
agent,

its

exchange when

of

bill

for-

representative in that

Supposing the goods are sold to England, the

country.
final

payment from the

effected, say in

London

the

(either

the

or

be

will

bank which bought the

Another merchant

office

buyer of the

ultimate

bill in

London, to the

re-

of the bank, or

its

bill

resold) of the

if

China.

London, on the contrary, will mean-

in

while have sold and delivered goods to an importer in China,

for instance

rails,

have drawn a
this

the

in

bill

or machinery, or shirtings, and will also

exchange on

of

bill

London market and the

In neither of these cases has

London

ment

London

or from

money been

sent from China

By

to China.

London has acquired

in

pay the London

his bill of

seller of

the

receiving pay-

its

buying the

by receiving

of the Chinese

means by which

English goods the equivalent of

exchange on China, and the bank

covered for
seller

holder of the

last

London from the English buyer

in

goods the bank

to

sells

China receives payment from the buyer of the goods.

bill in

to

He

buyer.

his

bill

in

China

is finally

on London from the Chinese

in its turn the

payment from the Chinese

buyer of the imported goods.

By

far

the

trade

are

settled

majority

of

this

in

mutual claims

manner.

Only

whole amount of claims on one

countrj'

amount

country

no

of

longer

claims

on

another

be covered through trade

but hard cash must be sent to

therefore,

the

rule

international

few millions

this
bills

the

way between two

in

metal

are

end the

in the

if

exceeds the whole

balance
of

countries,

required

to

can

exchange,

balance.

that hundreds of millions are

sated in the aforesaid

only

settle

in

It

is,

compenwhereas

pay the

that has in the

end

to

pay

has an adverse balance of trade for the time

metal,

because the

being,

The country

ultimate balance.
this

72

amount

total

cover the total amount of

The balance

deliveries does not

its

imports.

its

can, however,

of

be changed

in a

very substantial

degree by financial transactions, such as borrowing money,

either for account of the

engaged

government or

in the construction of railways

on account of open credits

and carriages,

for,

will

be handed over

in

state

money, which

kept at

will not immediately

but that debentures maturing

paid

of

and even

steamers, merchandise, can be sold and

rails,

China, the

companies

on,

general way. Railway engines

on condition that they

delivered

with

in a

for large

and so

exchange.
will

either

is

at

be

at a certain later date

If

a loan

is

concluded

once receive a large sum

forwarded to China

direct, or is

disposal in one of the great financial centres

its

of the west.

It

thus often happens, that important amounts

are put at once at the disposal either of a government or

large business

of

concerns,

as the result cf a loan or of

delivery of goods on credit, and to the superficial observer

the

result

of

these

movements might seem

to indicate a

very favourable balance of trade. But on closer examination

it

will

soon become evident

that,

though

this

balance

may

temporarily entitle to shipments of bullion towards China,

the debt which

is

thus incurred will have to be settled in

the course of time

by regular

instalments.

Consequently,

the balance of payment does not always offer a fair image

of the balance of trade.

In both cases,
as

well

when
netary

as

by

viz.

by the settlement

the

settlement

of

of a balance of trade

a balance of payment,

the latter temporarily dominates the position, the

condition of a country, and at

all

mo-

events the stock

may be

metals,

of

make money abundant, an

will

render

and a

scarce,

exchanges

or a rise in

fall

be the immediate

will

An

affected to an important degree.

influx of metal
it

73

bank

rates

efflux will

and foreign

result of these conditions.

Consequently

every monetary system has to come very closely into

contact with these balances of trade and of

and
an

urgent

influence

their

feel

to

necessity,

ver}' strongly.

before

It is

payment
therefore

taking any decisive step in

with a thorough and very cautious exam-

this matter, to start

and

ination of these balances

what way they

to see

point.

Every monetary reform runs a

serious risk of failure,

real character of these balances

remains obscure to the refor-

if

the

mers, since:

balances of this kind must sooner or later be settled

by the shipment
If

of metal.

outgoing shipments of metal become of importance a

serious

drain

circulation

of

monc}-

is

the country;

of

liable
if

made upon

be

the

these shipments, on the con-

come from abroad they may

trary,

to

result in a rather

embar-

rassing plethora of mone\'.

It

must

not,

whether
itself

to

national

in

be

is

payment
of this

of

stored

away

in

the countr}'

In several cases this purpose can be

by stocks

kept abroad

of sovereigns

or

circulation

in the first place available for these final inter-

settlements.

better served

money

however, alwaj^s be the task of the money,

of monej' already held abroad. If this

in real coins, for instance as

earmarked
a balance

earmarked

in
in

London

London can

stock. It cannot,

a depot

for foreign account, the

also

be made out

however, always be consi-

74

dered a wise policy to keep these reserves abroad

which bear no

coins

tomary

invest

to

reports,

bills,

consequence

or
is,

interest,

and

loans

call

as the stock of

in

hard

therefore quite cus-

The

and other investments.

that these

same degree be

final settlement of these

of trade or of

is

a part of these foreign reserves in short

foreign reserves will in the

by the

it

affected

unfavourable balances

payment
money

and even more so,

in the country itself;

because the method of settling balances by

way of addition to,

much

or deduction from these foreign reserves will often be

more convenient than the shipment

another

to

the former can

of

be effected by a telegraphic

order in one single day, a shipment

reach

to

its

Every

destination.

may

take

many weeks

fluctuation, however, in these

foreign reserves will have about the

netary situation at

metal from one country

same

effect

on the mo-

home as would an actual shipment of coin

mean a contraction or an inflation of

or bullion. Both would

money and would consequently

the

rate

of

discount

and

in

find the

same expression

the foreign

exchange.

in

It is

therefore of the greatest importance to China, not only that

foreign reserves are formed but also that their object and
their

manner

of operating are clearly defined beforehand in

connection with the balances of trade and of payment.

If

China were

to

adopt the real gold standard with a

considerable circulation of gold coins and an adequate gold

coin reserve within the country, an adverse balance of trade

would cause a drain upon the gold

On

the other hand,

if

China were to adopt a single gold

exchange standard with a

in

coins.

circulation of silver token coins

the interior, and a corresponding reserve in gold metal


and gold

securities,

75

either in the country itself or abroad,

such a gold reserve would also be drawn upon

in the

would be

of an unfavourable balance, since the token coins

presented

exchange

in

for

face

their

event

value in gold, and

bring about an exhaustion of the gold reserve, either

thus

total or in part.

would therefore be a necessity

It

for China to

know

exactly her strength as regards her balance of trade

before she decided to adopt either of these two currency

systems in an already perfected shape.

Should

this

balance

of

trade turn out to be generally

favourable a gold standard or

a gold exchange standard

might be maintained without serious

An

difficulties.

intermittent adverse balance of payment,

last too long,

would be

relatively harmless

if

did not

it

and could be met

from the gold reserves. In the same way has British India
been

able

to

maintain

the

rupee at

nominal

its

value

during some subsequent years of famine by her gold reserves in

India and in London, though

time in

British

exhausted

if

India

that

British

value of

Even

Is.

in

these reserves would

India to

it

would have been

maintain her

rupee

become

the

at

difficult

nominal

4d.

case of an adverse balance of trade of a

permanent character China may remain

maintain

at the

the conditions of distress had lasted another year.

Under such a contingency

for

was feared

it

her gold

in

more

a position to

standard or gold exchange standard as

long as she succeeds in maintaining her balance of pay-

ment by means
support

an

manifest

its

of fresh loans

adverse balance
full

and
of

credits,

trade

consequences and:

but without such

would

in

the

end

76

would be a very dangerous experiment

it

to start

with a gold or a gold exchange standard as an uni-

form system for the whole country, as long as it is

quite uncertain which is the real position and strength
of China with regard to these balances of trade and
of payment.
be much wiser to postpone an adoption

It will, therefore,

of the gold or of the gold

exchange standard, as the only

existing currency system, until a careful examination has

shown the

real position of

an examination

China

and such

probably take several years.

will

This consideration makes

to invent a

in this matter;

it

even more desirable

temporary scheme,

which during a preliminary period would avoid the dangers of a drain

upon the reserves and

at the

would be preparatory

to

of a gold or of a gold

exchange standard.

If

of

an ultimate and perfect system

such a preliminary scheme could actually be made

to operate
it

it

would mean the

would make

it

solution of a difficult problem:

possible to adopt at once the principle

a gold or of a gold exchange standard, even before a

token currency could be issued, and to carry

to

some extent already from the

same time
and
of

same time

it

into effect

moment; but

would prevent an exhaustion

at the

of the gold stock

of the reserve of gold values, because the old reserves

silver

with the
fied

it

first

coin and bullion, which

new gold

reserve,

for the settlement of a

I shall try to

In the

first

make
place,

clear

would

it

would maintain along

still

be especially quali-

temporary adverse balance, as

below

however,

(cf p. 85).

we ought

to inquire,

whether

77

a transition-scheme could be devised and could be

such

used by China.

practically

would suggest a solution on

the following lines.

As

matter

principle

of

must be adopted from the very

Kuping
be

which

tael,

equivalent

exchange standard

start

with a unit of 1/3

a silver price of

unit, at

grams

0.3644883

to

gold

thus

28/-, will

gold. (See for

of fine

calculation of this figure p. 89 below).

The

will thus

unit

known

already be

to every-one

from

the beginning and speculation on a subsequent announcement

the

of

As

gold

par

of

long as China

feiting

on a large

is

be out of the question.

this unit will

a position to prevent counter-

not in

token coin connected with

scale, a silver

and based on such a gold exchange system

issued.

This

unit

will,

however,

books of the central bank

at

will not yet

once be used

be

in the

and the other banks, the foreign

banks as well as the many native banks and the members

be earnestly requested

of the Shansi Guild, will

policy as far as
It

in their

is

to join this

power.

could perhaps be argued that an important source of

profits

asmuch

these

for

bankers would thereby be stopped,

as turns on the exchange, which

in-

have hitherto been

necessary to cover the risk of fluctuations, would henceforth

be

reduced
the

in

long

run

improvements

money

the wa3's of transferring

opment
the

of

But

abolished.

or

business

and

profits of bankers.

will

if

or

past,

and

we

in
will

is

the

quite

certain

currency

that

and

in

cause a general devel-

thereby

indirectly increase

Their intermedium must of course

be adequately remunerated,
the

it

think

in

the

future

as well

that

this

could

best

as in

be done

they were to charge a commission on each transaction,

on

the turnover of an account, in the

same way

as

is

78

They could

done by western bankers.

cases where

also, in

a commission would be thought impracticable, require their

customers to

leave

minimum balance

certain

in

their

hands, on which no interest would be allowed.

Wherever such a

made
but
to

would

it

it

trial

have other values transferred

stability

satisfactory

unit

it

possible

and thereby

system were found

balance in a gold unit account with the cen-

have enumerated above, on

Not only can book

banknotes
p.

were

application could be gradually extended.

its

credit

above,

new

the

If

make

start

into this

contracts.

of

bank may be acquired

but

unit of account

no wa}' prejudice any further measures,

in

would already from the very

ensure

tral

new

with the

any

p.

52.

be

also

issued

be

thus

ways which we

of the

be created

credits

could

and

54)

in

based

in the

in

this

on

new

unit,

unit

(see

proper

gold

exchange system.
Notes would chiefly

be

issued

the following cases:

in

against payment of coins, bars, or any kind of hard

a.

cash;

against

h.

paj'^able

purchases

abroad

transfers;

in

one

in

way

this

of

of

bills

exchange which are

of the gold centres, or of telegraphic

it

will

be possible

convert mer-

to

chandise into gold;

against credits opened in

c.

purchases

of

inland

bills,

the country

itself,

against

or against advances covered

by

collateral security.

The par value

the

of

these

following arrangement:

equivalent

is

handed over

once as a reserve against

away

hi

natura,

and

if

can

notes

be maintained by

in the events of

to the

bank which

this issue

silver

a.
it

and

/;.

an

can use at

the coins can be stored

bullion

is

paid

in,

this

79

be sold against gold values; the proceeds of foreign

can

and telegraphic

bills

being

converted

be kept abroad,

can

transfers

earmarked

into

metal

after

invested

or

in

foreign bank credits, foreign short loans, foreign discounts,

or any other kind of investment which

sufficient^

liquid

may be

considered

As

purpose of a gold reserve.

the

for

long as gold coins are not suitable for the circulation, and
as

long as

silver

be

issued,

will

on

to

54,

p.

way

it

be

based

coins

notes

these

redeem

to

exchange. Of course

it

hard cash. The only

in

a parity with gold will

at

them

upon gold cannot

was already observed

difficult, as

redeem these notes

maintain

to

therefore

token

be rather

by payments

be impossible

will

to

foreign

in

redeem, in

way, each separate note of any denomination and

it

this

will

necessary to admit only large amounts for this purpose;

probably be sufficient

will

thousand

of the

for

companies
to

new

redemption,

the

banks,

any moment,

possess,

and multiples
the banks

etc.

the equivalent in
at

unit,

that

these notes in

offer

as

so

they

for

will

par.

to

accept

taxes

or

offices,

can-

the
other

the

reason

But as long

to

be

convinced

whatever amount of notes they

be ready

moreover,

If,

in a position

that

gold abroad could be had in exchange

nominal value and thereby

at

thereof, are accepted

and some other large

a sufficient amount.

have

notes

to

population

accept the notes at their

assist in

maintaining the currency

the government
at

their

payments are
will

to

may

nominal

is

found willing

value

whenever

be made at any of

their

soon become aware that they

pay with notes as well as with any other kind

money,

and

they

it

only amounts of 50 or 100

if

be practically the only people

will

be

will

notes and trust them.

soon

become

familiar

with

of

these

80

The foreign gold reserve has thus been chiefly built

up by the equivalent received against the issue of
these notes and must consequently be used for no other
purpose than for the maintenance of their nominal value
and therefore only
this policy

is

the redemption of these notes.

for

followed,

will

it

be practically impossible for

gold reserve to become exhausted by an adverse bal-

this

ance of trade or of pa3''ment, because

does not yet act

it

a guarantee for such an unfavourable balance;

as

If

only be exhausted

This might indeed occur

sented for redemption.

were

to

the outstanding notes were pre-

all

if

could

it

if

a profit

be made on the foreign exchange by offering the

notes for redemption, in which event bankers would take

their profit

by tendering

as

many

notes as they could get.

bank ought

In order to avoid such a consequence, the

make

it

a point

only

redeem the

to

margin over the current rate

it

unprofitable to tender
It

to

could be

argued,

depreciation

them

as an

notes,

exchange operation.

would
that

at a slight

which would make

of exchange,

that this

the

of

notes

to

practicall}^

amount

would be equal

to

an eventual depreciation of the Chinese exchange under

For

gold par, as quoted on foreign markets.

the

central

sentation of

bank
its

sold

its

instance,

foreign exchange against

notes at a rate of

101%,

viz.

if

pre-

101 paper for

100 gold in London or elsewhere abroad, the exchange

banks could be expected

discount in

would incur by offering them

not

1%, which they

order to cover the loss of

be denied

that

such

to the central

a depreciation

that even at a discount of one per cent,

profitable for the

banks

same

to accept the notes at the

is
it

bank;

it

can-

possible,

might

still

to offer these notes in large

and
be

quan6.


exchange. But though

may

fall in

redemption, as a speculation for a further

for

tities

81

this

may be

theoretically true

and

occur to a certain extent, there are several

actually

other influences which would counteract such speculations.

soon as the circulation of these banknotes has grown

As
into

figures

part

of

to

some importance, they

of

will

have become a

the currency of the country, and their withdrawal

any large extent would be

felt

a serious inconve-

as

Such a withdrawal, namely, would cause a severe

nience.

money with

contraction of

the unavoidable result that

would become wanted and consequently

dear.

money

tendency

make

towards an appreciation of the banknotes will then

itself

1%

discount of

the

felt,

soon disappear, and

will

people will no longer bring their notes to the banks unless

the latter be willing to pay the

same

tained in

As

the

come back

the

for

it

soon

will again

banks,

become more

profi-

notes

back

bring

to

things have

as

these

than to present them for redemption to

circulation

into

circulation.

to this point

even

table,

daily

price as can be ob-

the central bank

at

one per cent discount.

It

might even

occur as a result of this tendency that the stringency in

the

circulation

so acute that the bank-

would, on the contrary, obtain an agio over

notes

Such an agio

foreign

gold

central

insurance,

be checked

will

many

to issue as

the

money became

of

if

bank

the central

notes as are required, against

values abroad.

bank must

interest

Of

course,

also calculate a

and other expenses

for
to

it

foreign

reserves

and

to

payment

in
so,

for freight,

if

the bank

might become profitable

the exchange bankers to add as

the

%.

ready

be incurred by

eventually shipping these gold values to China;

did not charge these expenses,

00

when doing

margin
to

is

much

as they could

bring the banknotes

is-


sued

them

against

the

into

were done on a large

82

circulation

at

home.

money would become

scale,

and banknotes would even run the

abundant,

depreciation

very
of a

risk

consequence of their redundancy. But

in

would again have the

effect

lower

for foreign exchange,

buying rates

its

this

If

of compelling

this

bank

the

and

to

this re-

duction would no doubt put a stop to that movement.

Therefore
1

cannot be denied that a fluctuation of about

it

and perhaps

still

more, on either side of the

little

nominal value of the banknotes would be possible, but

seems very

likely that the central

to maintain a policy,

circulation of

its

own

whereby

it

notes. This

bank

many

and

interest,

ing

its

It

is

first

difficulty

that the

bank will be in

notes by redeeming

its

notes as seems necessary in the public

by

to prevent speculation on either side

alter-

buying or selling rates for foreign exchange.

possible that, as a temporary measure,

considered

were

have no

can adequately control the

means

a position to maintain the par value of

or issuing as

will

it

to

wise policy

on

the

part

encourage the primary adoption of

buying foreign exchange

leaving a profit to bankers.

would be

it

of the

bank

notes

its

it is

were

in the true interest of the country, since the

ment

of such a central

superior men,

who would

act under

by

of course understood

that such or any other measure could only be taken

bank ought

it

and thus

at favourable rates

But

if

to

be

in the

if

it

managehands of

no other influences than

those of the public welfare.

In

the

manner which

possible to limit the

have

working

just described

it

would be

of the foreign gold reserve to

the task of maintaining the value of the notes issued; and

what

is

said

here about the notes, will of course also ap-

ply to the book credits, which are kept in the

new gold

unit.


Matters will become a

bank

the central

ney against

sub

{cf.

equivalent

issued

against

the

notes

maintained

par

at

whereas

become accustomed

to

to

be

which have actually

as those

would have

security

But

gold value.

in the first

outstanding notes

all

can be offered for redemption, especially

has

would

it

in foreign gold value,

imagine that

to

difficult

is

operations to the lending of mo-

this

such

from the moment that

different

c, p. 78); for in this case

well

as

against

issued
it

its

an

receive

place

little

extend

securities

not

been

will

83

if

the population

and therefore

their daily use;

the central bank will probably soon be in a position similar

to that of other

banks

keep a portion of

to

and be found strong enough

of issue,
its

banknotes reserve in loans and

discounts, instead of keeping one

hundred per

cent, in

buUion

or realisable gold value as before. Several central banks of

under a legal obligation to have a cover of metal

issue are

and metal reserves

It is to

lities.

bank

in China,

50%

about 33 to 40 or

of their liabi-

be expected that sooner or later the central

reorganised on such

lines,

50%

gold cover to say

to restrict its

may

also be allowed

of its liabilities.

This

however, could better be examined in a separate treat-

point,

on

ise

of

the

organisation

of

central

The Ta Ch'ing Bank, which

China.

bank

acts

now

of

issue

for

to a certain

degree as such a central bank, has not yet been organised

on such rigid
It

may

line,

with

be

.principles.
sufficient, for the

purpose of the present out-

only to observe here that

a

it

will

be prudent

to start

cover in gold or gold values against

considerable

the notes issued, in order to meet very promptly every de-

mand

for

redemption and to put the value of the notes

beyond any doubt

For the present

in the
it

is

opinion of the banks and the public.

advisable,

as

we

think

we have


now made

more foreign
that

countries, but there

of this

fund

one or

in

not the slightest doubt

is

be

will

it

keep the bulk

to

clear,

84

desirable to bring this reserve fund back to China,

as soon

stock

as

it

possible

is

metallique)

(encaisse

to

keep an adequate metallic

within

the

country.

It

is

of

course an abnormal condition for the larger part of such

a fund

be kept abroad.

to

China must be

for

that

at

The

ultimate state of affairs

least say, thirty five or forty

per cent, of the metallic reserve, either

or

coins

duly

of

country, and

we

is onl}^

it

desirable at

the shape of gold

in

secured token coins,

kept within the

is

first for

the reason which

have pointed out that a larger proportion be temporarily

kept abroad.

be

It will nevertheless

a
is

portion

now

useful,

even

of this reserve abroad, in

the rule with

almost

But the main function

all

in the future, to

keep

accordance with what

the great banks of issue.

of such a foreign part of the reser-

ve will then be no longer the immediate reimbursement of

banknotes,

but rather the maintenance of the foreign ex-

changes

a parity with gold by means of sales and pur-

at

chases of gold drafts, cheques and transfers in gold value.

The

character of such a gold reserve abroad as

propose for China

distinguish
for the

its

qualities: first,

may be drawn upon

and

so

drafts,

An

(1

outline of the

issue which

is

it is

important to

of a fund which

is

available

in the future, of

or added to

by means

a
of

as to maintain the stability of the rates of

foreign exchange.

1)

therefore, twofold

redemption of notes, and secondly,

stock which

gold

two

is,

we now

The

portion of the reserve fund which

of operation of a central bank of

organisation to use a gold reserve

methods

enabled by

its

is

necessary for the

have

to

be brought

Only

the

other

where

therefore

in that country, including the possi-

gold coins and silver token money.

could

part

it

will

functions

China as soon as normal conditions

to

bility of a circulation of

abroad

of these

first

have been established

85

then

be allowed to remain

would serve a more

useful purpose than

in China.

How

payment

of

balance of trade or the balance

to settle the

the gold reserve abroad cannot yet be

if

used for this purpose?

We

must yet revert

touched upon on

p.

to a matter

76 and examine by what means

be possible to

settle the

long as there

is

The answer

will

for this purpose.

same manner

as thus far,

the

St,

that

of a

silver token coin

circulation

silver

side

by

side

now the following

circulating medium in metal,

cannot be issued 2nd,

;

that

metal to be used as an interior reserve for the

may be

countr\'.

This reserve

silver as

long as the balance of trade

but on the other hand

of

by

r.

with the

unit.

In China silver performs

1

settled
i.

This will be another great advantage of temporarily

maintaining

new

will

nor anj^ gold stock

in circulation

be that these balances can be

in the near future in the

silver.

it

balances of trade or of payment as

no gold

which can be used

or gold reserve

which we have already

it

an adverse balance.

in this twofold character, is

Java Bank,

in

has appeared.

Batavia,

is

It

in

as long as a
of a stock of

liabilities of

freely increased

will serve to

functions:

the

by imports

of

favour of China

meet the exigencies

has accomplished this task for

found in the last annual report of the

19111912, of which an English edition


many

years

and

can see no reason

same way

tinue to serve in the

introduction of a

The

why

some

for

should not con-

it

time,

even

after the

new gold unit.

would be

result

86

that, as a

preliminary arrangement

during a certain time, perhaps for several years, two standards would be in use side by side

has been in existence

in

the silver standard, that

China since centuries, and the gold

exchange standard since the adoption

with

application

its

similar situation,

many

as

in

book

credits

we have

new gold

of the

and banknotes.

unit,

seen above, has lasted for

years in some parts of the Dutch Archipelago with a

population of

many

number

considerable

millions,

amongst which there were a

of Chinese

merchants and immigrants.

has proved absolutely satisfactory during a period of

It

transition,

when

these parts of

were

Archipelago

the

for

several reasons not yet ripe for a single gold- or gold ex-

change standard system.

The

issue of token coins.

The

issue of token coins will

be the commencement of a

second period of the monetary reform as soon as the gov-

ernment

will

Nevertheless

be strong enough
it

will

to carry out

be worth while

to

such a measure.

consider

consequences would be, because matters

its

different as soon as silver token coins can

now what

will

be issued

become
in

such a

second period. Of course these token coins can only be minted

and issued by the government, and

it

will also

be the govern-

ment's duty to maintain the gold value of these coins.

be prudent
nal

and the

danger
is

for

to

establish such a

It will

margin between the nomi-

intrinsic values of the coin, that there will

be no

an overvaluation of the coins as soon as there

a slight rise in the price of silver, and

it

will

even be

advisable

to

the

fix

at a gold ratio

is

the Indian rupee (21.9 to

the Straits dollar

(2

par of the silver token coin

bullion

which

to

.3

87

lower than in the case of

slightly

the Philippine dollar (21.3 to

1),

and the Japanese yen

1 )

(21 .6

order to prevent that, at a rise in the price of

down and

Chinese coins would be melted

before

the

all

therefore, probably

the

that

quantity

compared

down,

to its

unless

it

token

and

if

silver

be

to

of the metals gold

will

value

nal

to

fix

which

of

and

silver

gold value of the

the

both

are

very

new

of a shilling or

suitable

units,
1

and

the fine

token coin would at the same time

the

factors.

be seen from the following calculation the nomi(in

gold) of the

new

token coin, proposed

silver

by us on pp. 89-90, would be equal

tael,

Chinese

1.

have been determined by these two

As

would,

This means

the ratio with gold were settled at 21 to

content

bullion

world price of

the

in

rise

somewhere near the gold par

a Reichsmark,

nominal value, will result from melting

were decided
coin

of

as
to

silver contained in the

fine

of

there

to a ratio as of 21
If

21

the

silver,

sold

be the most advisable one.

which brings the values

silver,

ratio

1 ),

1)

in

be fixed at such a figure that no profit,

token coin, will

as

others.

gold

to

to 1/3 of a

Kuping

ounce standard, which

at a silver price of 28/- per

is

very near the present day value.

Its

future

value

intrinsic

in

fine

silver,

when

actually

minted, must be of such a figure that the price of standard

silver

must be allowed

to

rise

from

its

present level

of,

say 28/- to 45/- before the intrinsic value becomes equal to

its

nominal value,

price.
1

/.

e.

with more than 60yo of

In other words, the present gold ratio

must be allowed

to sink to 21 to

(i.e.

of,

its

present

say 33^/2 to

again about 60%);

and

this

gin

of

88

can only be attained by leaving a fiduciary marabout

per cent on the silver employed, which

60

will constitute the seigniorage profit.

As

a basis of our calculation for the weight of the

token

silver

such

small

we

coin,

readjustments as practical

made

render advisable will be

In China the

Kuping

Kuping

tael

new

tael,

and

considerations

may

take the

shall

later on.

often considered to be of

is

absolutely pure silver, but other degrees of fineness are also

given by various authors, and

basis

is

calculation

of

fineness
also

but the

uncertain,

therefore

which
start

seems more correct as a

take the normal

The weight

of 987 thousandths.

at 575.8 grains,
shall

to

it

is

Kuping
of a

normal standard

tael at

Kuping

may

tael

be taken

equal to 37.31123541 grams.

We

our calculations from these figures,

according to which the Kuping tael would contain 568.3146

grains of fine silver.

We
present

shall further take

moment

we propose

as a

a value of 28

normal
d.

silver price for the

per standard ounce, and

to select as a future unit, for the reasons given

on pp. 61-69, the equivalent of one third part of a Kuping

tael at 28d.

per

oz.

An unit of exactly

^/g

of the

Kuping

568.3146 grains
:=
If

28d.

silver,

the

will

same

tael

Vs

would then contain

89.4382 grains of fine silver.

buy one ounce,

28d.

will

buy

or 480 grains, of standard

s'^^^j

of

an ounce, or 444

grains, oi fine silver.

The gold value

at the price of 28

11.946553

d.

of the proposed unit, expressed in silver

d.,

would thus be

89^4382

28 d.

89

The gold sovereign equal to 240 d.

grams of fine gold, from which it results

new

unit (of

1/3

of a

Kuping

tael) will

contains

7.32238

that the proposed

have the following

gold value:
7.32238

240

When we
as

from

21

11.946553

0.3644883 grams of fine gold.

adopt a future ratio between gold and silver

to

(see p. 87) the fine silver content of the

proposed new unit would have

0.3644883

21

to

be

7.6542543 grams of fine

Supposing a fineness of 900 thousandth

coin

representing

the

silver.

parts, the silver

proposed new unit would obtain a

gross weight of
8,504727 grams.

Comparing
the franc, the

rupee

we

this

coin

Dutch

with the shilling, the Reichsmark,

guilder, the Japanese half-yen

find the following figures:

and the


would only become equal
rose

silver

to 45 d.

would seem

it

to

90

nominal value

to its

be very

if

With

per ounce standard.

the price of
this

margin

safeguarded against

satisfactority

the consequences of a rise in silver.

perhaps simplify matters

It will

coin

is

made

at a

new

the

if

silver token

round figure of 8.50 grams, which would

then contain 7.65 grams of fine silver and 0.85 grams of alloy.

The gold

would thus be made a little

ratio

better than 21 to

1.

be desirable to mint a silver token coin of a

It will also

higher value

than

the

single

unit,

for instance a 2 unit

piece.

The

subsidiary coinage in silver could be adopted at the

corresponding contents of fine

silver,

but at a fineness of

In that case the figures for the subsidiary silver

800/1000.

coins would be:

gross weight
in
1/2

unit,

1/5

unit
It

ed
to

or 50 cent piece

20

to

3.80

grams:
3.825

1.9125

1.53

if

these figures were also round-

which there could be no serious

make them,
4.75

in

4.781 25

would simplify matters

off,

fine silver content

grams;

objection,

and

say:

grams gross weight and

content

of fine silver, for the 50 cent piece,

and
1.90
1.52

grams gross weight and

content of fine

silver, for

the 20 cent piece.

This would no doubt make coins of a very handy

Subsidiary coins of smaller value than
better

made

of nickel, for

and one twentieth

of a unit are

which coins representing one tenth

part of a unit could

10 and 5 cent pieces.

1/5

size.

be selected, called


It

always desirable not to make a larger number of

is

than

subdivisions

are

make copper

seems there^/j

cent

of,

say,

it

on

if

they should

would therefore

act

authorizing the minting of

contain a stipulation

to

later

The currency

such coins without making

The

coins of

always be minted

be actually required.

imperative.

issue of gold coins.

Though
gold

it

at least to begin with, as other copper coins

2 or 2 1/2 cent could

have

necessary and

really

cent and

fore desirable to
only,

91

it

coins

is

will

seems desirable

rather doubtful

if,

be actually wanted
hold

to

this

some time

for

in

the

possibility in

to

come,

circulation,

it

view from the

very beginning.
It

is

obvious that in that case coins of 10 units and of

20 units would be required and

it

would probably be wise

also to authorize the coinage of these coins at the Chinese

Government mints
individuals,

at

banks and

on conditions which could be settled

These gold

grams

for account of the

coins

would

then have

of fine gold for the 10 unit piece

900/1000, of 4.04987

two

later on.

to contain 3.644883

and a gross weight,

grams; the 20 unit piece would

have the same gross weight and the same

as

of private

fine gold content

ten unit pieces.

Particulars of

are given

in

some other gold

the following table:

coins of approaching value

92

gross weight
in

grams

^^"^^

S\^
content

measure has been adopted

similar

standard

make

93

act

gold

foreign

the Mexican gold

which authorized the executive

1905,

of

b}'

money

legal tender at

to

any time. This

applied especially to the United States coins.

There

example

the

another instance where China might follow

is still

Mexico,

of

certificates against

namely be

fairlj^

own

her
to

store

expensive

amount

considerable

in

viz.

the matter of issuing gold

gold bullion in process of coinage.

China were some day to buy a

if

of bullion for the purpose of minting

She would then have

gold coins.

the bullion until

and a considerable sum

could be

it

would be

to ship

and

in the

mint

interest

dur-

worked

lost

in

ing the process until the coins could be issued.

saved

could be

erest

tificates

in a

very simple

were appointed

commission

to issue

way

if

This

int-

a currency

temporary gold cer-

an amount not exceeding the value

for

would

It

of

the

gold bullion bought.

This commission would either have to bear an international character or otherwise

be appointed

in a

manner as

to

ensure complete independence from the government, in order

to

avoid the risk of these certificates becoming a kind of

government currency paper.

It

would

also be useful

certificates could only

central
trustee
icate

these

bank
have

them

of

made

The

were enacted that these gold

it

be issued under a trusteeship

who would then

issue,

of the

in this quality of

to countersign those certificates or to authentin

some other way.

certificates,

would not be
guarantees

if

for

instance

desirable, but

if

Small denominations

under one thousand

the above

named

of

units,

serious

were given they could without objection be

unlimited legal tender.

central

bank

of

issue could then

be authorized

to

94

count these certificates as part of

on

public statement of

liabilities.

would ultimately be exchanged

soon

as

coins

and

assets

its

certificates

new gold

nicatssc vigtalliqiie,

publishing the figure thus held in every

condition of

These

its

were ready, and the

as

a sufficient

certificates

for the

amount thereof

would then be withdrawn,

Meanwhile

xinder adequate guarantees for their destruction.

they would have facilitated the coinage of gold for account

of

government as well as

the

who may be found ready

in

China

way

may

they

purpose

exchange

in

of

for

to import gold for the

minted, whereas otherwise, on account

it

of the loss of interest involved, this transaction

them a

large banks of issue abroad have a similar object

view when they grant advances, free of

gold,

floating

effective in
to

give

cates

might bring

loss.

The
in

the mints

to

these gold certificates. In this

be induced

easily

having

for account of individuals

to sell gold bullion

premium which

of

is

often

encouraging the import of the metal.

similar

inducement the aforesaid

be issued as

could

purchased

a form

interest, against

on

According

other

the

were handed over

to

to the

the

soon
side

In order

gold

certifi-

as the gold bullion

and

shipping

very

was

documents

government representative abroad.

above-mentioned proposals

the table of future Chinese coins would appear as

follows

Gold

coins


Silver coins

95


The Chinese

96

on the contrary, would partly consist

portion,

gold and silver bullion, and another

of

ain figure,

the

in

construction

enterprises
debt, for

become

railways and other interest-bearing

of

a public character, or in the redemption of

of

which purposes important means would thus

easily

to maintain the gold parity of the token coins.

would then be possible

to

keep up the value

of the

token coins by a similar arrangement as was pro-

silver

posed for the banknotes, viz

in foreign

either

by giving

by delivering gold

bank which

central

or silver bullion from

would act as the government

Inasmuch as these token coins

banker.

transfers

gold values, for amounts over 50.000 or 100.000

or partly

units,

the

to a cert-

available.

How
It

up

part,

could perhaps be allowed by law to be applied

an integrant part of the

make them

scarce, as

will

soon become

withdrawal will

circulation, their

compared with the demand

for them.

This will tend to keep up their value and also prevent

excessive tenders of these coins in exchange for gold value
abroad.
It

seems, therefore, safe to assume that after a certain

time

portion of the coinage will for ever be prevented

from being tendered

25

cer-

consequently

for other purposes of general interest

and welfare

accumulated gold reserves

such as indicated above.

at

and that a

may

tain part of the

be used

at the public counters,

This part

per cent after a few years,

may

and

at

perhaps be taken
50 per cent, say

after ten years.

Supposing a

new
about

unit
71/j

total

pieces
d.

in

coinage of token money of 960 million

of about

one

shilling

nominal value (and

actual fine silver) the total profit

made on

97

coinage would amount to 360 million unit

this

pounds

the same, so that

on

place

or

9.000.000,

construction

no alteration

account.

that

of

= 18 million

provided the price of silver had remained

sterling,

Fifty per

would then
railways,

in

the reserve

cent

after ten years

of

&

had taken
1

8.000.000,

be available for

redemption of debt and so on,

and could partly have been employed

in the

meantime-

Provided the reserve fund be properly formed and managed, there could be no objection to raising the token coins, at
larger ones, to the rank of legal tender for any

the

least

The

amount.

central

bank would then

use these coins in payment of

its

would accept them

payment

as regular

notes,

also be entitled to

and the government

of taxes

and so on.

This would also have the effect of maintaining their parity

with gold.

The
port

difficulties

and expenses connected with

would naturally tend

these

coins

to

their trans-

produce different values for

at different places; but this could

probably be

prevented by an extensive system of transfers, which could

be worked by the government as well as by the central

bank.

It

would, therefore, be necessary to give numerous op-

portunities of

exchanging token coins

for transfers

on other

inland places and the offices which would be appointed for

that

service

could also assist in maintaining the parity of

the subsidiary coinage by accepting always every

of

subsidiary

this

exchange

for larger

coinage

above a certain minimum

in

token coins, banknotes or transfers on

any of the principal centres

amount

of the country.

small commission could of course be charged for those

transfers,

but

it

ought not

to

be so high as to endanger

the par value of the very coins which these transfers are

meant

to protect.


The

98

must always be exchangeable

subsidiary coins

at

the government offices.

As
be

have

mentioned

just

useful, in order to

in

the last paragraph

keep up the value

coinage, to offer an opportunity in

ing

these

twenty
fers.
it

By

also using

be

will

issue

above a certain

coins,

units, against larger

token coins, banknotes or trans-

viz. first,

payments

wages

of the

as

much

as possible for

government

and secondly, by means of a slight

etc.,

advantage which could be given when payments

government are made

new

ways,

in several

by using them

of

start the

available.

The government may encourage the use

token coins

purpose

before a sufficient amount

coins

would be

this

found desirable, to

this is

if

subsidiary

of token coins

many places for exchangminimum of say ten or

banknotes and transfers for

possible,

new

of

will

it

of the subsidiary

in

new

coins, instead of in

to the

sycee or

other currency.

The

government
sycee

coins,

troduction

amount
been

of

will,

and cash
the

course,

have

to

accept

old

a long time even after the

in-

token coin; but as soon as a sufficient

of token coins

issued,

for

of

and

of subsidiary coinage will

the government will act wiselj'

if

it

have

only ac-

cepts the old currency at a small disadvantage to the public as

compared with the new

then prefer to secure the

local

money

new

coins.

The population

coins beforehand, through

changers, in the market, and so on, so as

to protect themselves against the little discount,

would

suffer

of taxes.

will

if

which they

they kept the old coins for the payment

99

In this wa)^ the population will not only soon

customed

new

to the

become

currency, but they will also give

it

ac-

a pref-

erence, and will even understand that the

new token coins

own weight in old dolhow soon the population

represent a higher value than their

lars or old sycee. It is astonishing

other

in

have become accustomed

countries

situation, paradoxical as

them

to

policy has also been applied

similar

ment

seemed

it

in several parts of the

to a similar

at first.

by the govern-

Dutch Archipelago, and though

these parts were often ver}' distant from one another and

had coins of entirely different systems,

be successful.

to

It

even

is

has never failed

present time being

the

at

it

applied in the island of Celebes, where there

culation

old

of

the Chinese

duiten",

cash

is

the population.

ulation

is

token

and

coins

when tendered

currency

payment

in

is

still

in

of

is

coinage

is

delivered

exchange

issued in

in

exchange

accept

the

new

preference for

distinct

accepted at a discount

and so

taxes

on.

The

old

be withdrawn

circulation, will

official subsidiary

for the old currency.

once the token coin

available

of

by the government mint and can be

Withdrawal
If

a cir-

been that the popto

soon as a sufficient quantity of the

as

is

result has

shows a

even

the old

which

currency,

The

still

is

Lombok where

medium

everywhere willing

nearly

them, because

Bali and

in

the current

still

among

and

of old dollars
is

and cash.

well adopted in the circulation

sufficient quantities,

it

will

and

be time to proceed

with the further withdrawal of the old silver dollars, the sycee

and the

cash.

This will be the third period of the reform.

The government must make

the

silver

dollars,

sycee

it

rule

and cas h which

to
it

demonetize

has received,


and

when

there

new token

into

and only

currency,
tion

them

coin

to

to

100

coins and

them again escape

let

into circula-

a positive necessity for doing

is

The government

subsidiary

so.

thereby very effectively promote

will

the withdrawal of the old currency.

Copper cash subject to different discounts.

necessary to reckon with another characteristic

It is still

the

of

and especially

currency,

old

viz.

the circumstance that their value

ent

places.

The copper cash

depreciation,

owing

chiefly

age,

and the discount

fers

very

at

is

to the

which

from place

materially

between the several

(See

issues,

the copper cash,

of
is

often

different at differ-

subject

to

serious

debasement of the cointhe cash

to

is

accepted

dif-

and especially

place,

about these differences

Appendix A).
In

those

local

values.

compared
been

and

where these coins are accepted

places

the population

discount,

now accustomed

is

This present

value

at a

to the present

generally

means a

loss

old one, but this depreciation has mostly

to the

and

gradual

and consequently the financial

economical

position

of

slow

the

people

has

conformed

itself to

the accepted value of the coins on the spot.

change

in

since, in a

this

value

monetary reform, a disturbance

commodities or

in

the

standard

thing to be avoided at any

to accept

Every

would cause new disturbances; and

of

life

cost, it will

in the value of
is

the very

first

be the best policy

conditions as they are and therefore to see that

the coming monetary reform will accept as a fact the actual

local values of the copper coins.

For instance,

if

in a

current at a discount of

town A. a

15%,

certain issue of cash

is

the calculation or eventually


the transformation into the
basis of 85
if

new

unit should be

the reform in that district

30%,

must be carried out on the basis

may be due

for instance to the great distance

given

spot

from

other

on.

which makes

centres,

unsafe or expensive

it

convey the money from one spot

cause

to another, or

to other similar factors vsrhich

or

of the nominal

discount of the copper coin on a

and so

due

70%

of

The

value,

be

the

same coins are

spot B. in the interior these

circulating at a discount of

to

made at

the nominal value of these copper coins;

of

/o

another

in

101

to maintain

levels

different

it

may

have contributed
prices.

of

unlikely that circumstances would occur which,

It

to

seems

in the period

immediately subsequent to the starting of a monetary reform,

would upset

this state of affairs or otherwise

an approximate

would not be advisable

It

market value
entail

to

pay more than the actual

a certain place or

in

great

district, for this

would

deal of speculation from which only a few

shrewd people would derive a

inevitably create a contraction of

disturbances because

profit;

moreover,

money with

all

possible to drain

away

the cheap money.

where the discount

is

less,

On

it

would

the attending

who

clever money-dealers,

are to be

many

found everywhere, would no doubt collect as

in places

bring about

levelling of such different values.

coins as

the other hand,

the population should

not be forced to exchange or calculate their copper coins at

favourable rate, on the ground that the calculation

a less

elsewhere had been

made

at a

heavier discount; this would

indeed be very hard on them, and moreover

the

conditions

of life

spots,

if

to

would disturb

and would also cause the reform

become very unpopular.

discrimination

it

It

calculate

will,

therefore,

different

figures

only the actual value on the spot

is

to

be no undue
for

various

taken as a basis

102

for the conversion into the

new

long been subject

The people indeed have

unit.

to this discrimination,

if it

can be called by

that name, and are novir accustomed to the various local values.

The government must

paying the published

not, of course,

undertake to continue

might

rates, for that

encourage

easily

speculative remittances from one spot to another.

It

is

that

true,

the various values of

founded on local conditions

as

on),

we have shown

a ready buyer for

smaller

above, but

any amount

depreciation

and

money

some place where a

in

would probably pay

it

amounts

for smaller

exchange

higher

consequently

dealers to send large

which existed

difficulties

and so

the government were

if

value prevailed than in other places,

the

cash are mostly

(difficulty of transport,

to that place,

and

amounts may thus per-

haps be overcome and the average of expenses reduced.

With a view
of course

be

to

such circumstances the government must

free to reduce

its

buying

so as to put

rates,

a stop to speculative tenders.

This

will

be a

necessar}- that
shall

the

very delicate affair and

it

executors of

of

this

act very fairly and cautiously,

part

absolutely

is

the

reform

and only with a view

wants and interests of the population.

to the real

The government must

strictly

avoid

every

idea

of a

speculation connected with the different degrees of depreciation

the

in

currency

existing

moment

on,

efficient

measures such as

be careful to maintain

cially in those spots

and
the

also,

from the

first

new currency by

we have mentioned

above, espe-

where the old currency had suffered

from a serious debasement.

It

would be premature

the introduction

subsidiary

of the

at this juncture to say

new

coins, as well as

silver

more about

token coins and of the

about the withdrawal of silver


sycee and cash.

dollars,

when

discussion

These questions

will

come up

for

further periods of the reform are reached

and the time has come

planning the execution of those

for

These matters

parts of the system.

much

considered with

103

will

then have to be

care and in the light of local interests

and conditions.

Some remarks about

The

question

the foreign gold reserves.

foreign

of

gold

reserves

requires

still

further consideration.

We
p.

are

84, that

convinced,

already expressed, on

ought to be regarded as an abnormal situation

it

whole

for the

we have

as

of these reserves to

be kept outside the coun-

and we think that such a portion as

try,

exchange

silver

necessary for the

banknotes must as soon as possible be brought

of

back to China,
ficiently

is

/.

as

e.

organised

soon as the country will be sufa circulation of gold coins and of

for

token money.

In the meantime

it

will

be found advisable not

to

several

financial

gold centres, perhaps even over as

gold centres as have regular connections with China.

of

keep

gold reserves in one place, but to divide them over

these

Parts

therefore have to be kept in London,

these funds will

Paris,

many

BerUn and New- York, and as

far as the financial

relations with other places are considered sufficiently close,

it

will

tres,

cisco,

be advisable to have also connections

such as

and

St.

in

Petersburg, Brussels, Amsterdam, San Fran-

the

East at Tokio and Yokohama, Saigon,

Bangkok, Singapore, and Batavia.

either in

hard

earmarked

for

at other cen-

coin, as sovereigns,

account

the principal banks,

of

The

values must be held

Reichsmarks, eagles,

etc.,

China, or in book credits with

in first class bills of

exchange which


payable

are

or in

centres,

The

gold

in

104

gold

or

value

any one of those

in

class investments with short maturities.

first

administration ought to be centralised as

sible, so as to

obtain uniformity in

much

as pos-

dealings with these

tlie

various securities, and also in order to reduce expenses.

no doubt be

will

It

sufficient

and

ability

They must have

acquainted
the

of

difficult to find representatives of

tactfulness

for

task.

and be thoroughly

technical experience

banking business and with the usances

with

markets and they ought

various

delicate

this

have many

to

connections so as to be able to judge the investments and

the value of the signatures on the foreign

For that purpose they must have

bills of

exchange.

class

sources of

first

every-day information at their disposal.

Especially during the

and expensive

establish

to

years

first

it

will

be very

many branches in
it will be much

so

difficult

these

all

principal gold centres; therefore

better to

start

with as few foreign branches as possible and to centralise

the

whole

business

one

in

office

for

another office for the eastern countries.

tries

western

The

eastern coun-

could be administered, for instance, from Shanghai,

where an

office

established.

of

the

central

For the western

be advisable

rather

to

bank would

of course

countries, however,

it

connected with

first

for

these centres

venture to suggest that

would

and well

by post and telegraph.

Amsterdam be

selected for the

period of the reform as such a centre of administration

the

western

rendering

long

all

be

select an absolutely neutral place,

situated in the midst of all the great gold centres

and

the

it

been

division.

Several circumstances unite in

a suitable place for that purpose.

quite

familiar

with

exchange standard, as history

the

policy

clearly shows,

Holland has
of

the

gold

and owing

to


currency system

Its

has been able to avoid

in its colonies all

much inconvenienced

which have so

disturbances

those

it

105

other Asiatic countries.

the conditions in China are different and that a

It is true that

monetary reform
nions and

country would affect

in that

had

the last ten years

its

Netherlands India

it

must be remembered

also

that during

population has exceeded forty millions.

account of the similarity between present conditions

which prevailed

China and those

in

in

be financed on the gold exchange basis was

to

very considerable and

On

vast domi-

four hundred millions of inhabitants in a different

its

way, but the volume of foreign trade

that

its

population,

acquired

system

several parts

in

among

the Netherlands Indian Archipelago,

of

another Asiatic

seems that the experience which Holland has

it

through

among

the

introduction of a

that population could

suitable currency

be of

real use to China,

especially in the beginning.

The

and telegraph services

postal

satisfactorily organised

maintain

would

It

dit

position

not, of course,

balances

to

be maintained
ministration
collateral

in

Amsterdam

in

are

and allow the Amsterdam Bourse

international

be necessary

Amsterdam; on

arbitration

to

business.

to transfer all the cre-

the contrary, these should

in the foreign centres; only

the central ad-

would be directed from Amsterdam and the

securities

exchange and
lodged in vaults

of

the investments,

eventually

part

of

the

such
bonds,

as

bills

of

would be

in that city.

Holland has been selected as a centre for the International

Court of Arbitration and a Hollander has been invited

to act as

currency adviser to the Chinese government so as to

obtain a thoroughly neutral treatment of affairs and to preclude

the favouring of particular interests of any of the

great

106

powers. For the same reasons Amsterdam could, for the

first

period of the reform and during the

new

growth

first

of a

currency system, be selected as a centre of absolute neutralthe

for

ity

administration

the western

of

portion of this

reserve and for the safe-keeping of part of the collateral

security, as

Such a

was suggested above.

gates,

Perhaps,

body

the aid of several Chinese dele-

and under the supervision

Chinese envoys
if

managed by one

administration could be

central

more Hollanders with

or

one or more of the

of

Holland, England, France and Germany.

in

the Chinese government should prefer a larger

of supervisors for this important business,

of the

one or more

gentlemen who are connected with the International

Court of Arbitration at the

Hague

could also

sit

on

this board.

All these gentlemen would act together as a neutral board

delegates to control the doings of the managers of this

of

bureau and would be able

and the Chinese

central

to

keep the Chinese government

bank

ait

by

coiLrant, for instance

quarterly or half-yearly reports.

This bureau would of course have to act under the direction

and the instructions

way

as the

of the central

Amsterdam

bank

in China, in the

same

Bank receives

delegation of the Java

its

orders from the head office of that bank of issue at Batavia.

Such a
school for

central

bureau

might also become a training

Chinese gentlemen, where they could learn the

foreign exchange business as far as this

the

object

of

maintaining

a parity with gold.

as

delegates

in

They

other

future

could

financial

development of the currency

in

is

Chinese currency at

thus

be

centres

as

China made

decentralise the administration of

its

connected with

trained

soon
it

to

as

act

the

desirable to

gold reserves.

107

The problem which we have endeavoured

to solve in

the preceding pages can briefly be summarized as follows:

how

devise

to

China which

will,

from the present complicated conditions down

of evolution

well-organised

for

be suitable during a long but necessary period

first of all,

to

monetary reform

system, and

moreover, contain a

will,

nucleus of ultimate usefulness.

Though
blic, to

this treatise is

whom

not addressed to the uninitiated pu-

monetary questions seem often obscure, we have

been compelled

some matters more

to elucidate

than

fully

others and could therefore not always be as succinct as

had wished.

Still,

for a matter so intricate

the Chinese currency problem undoubtedly

must be considered very

and

superficial

we

and extensive
is,

as

this treatise

pretends to be

it

nothing more than a collection of preliminary remarks.

Many

of the subjects

touched upon will require elaborate

we mention

the organisation of the central

the very important institution

a mainstay

We

and

with

sation,

to
this

to its

the

will

destined to

is

other

of

its

as well as of

be required before

its

its

functions
It

of

the

government

the

government, as

will

have

to

government.
supervision,

well

as

of

It

but
the

own

organi-

with regard

only possible at

is

must
its

and

the government

with

relations

banks,

juncture to emphasize the necessity of

under

become

functions, but an extensive

the currency can be regulated.

dependence

them

of issue,

time mentioned this institution

to

coming

exposition

detailed

that

bank

not the centre of the future currency system.

if

have only from time

and alluded

Among

can be started.

research before the reform

its

of

absolute in-

course

act

independence of

banking community,

be secured as a conditio sine qua

noit.

The

organisation of a central bank of issue for China

therefore

studied

when

108

very

the

first

subject

that

require

will

to

is

be

the present treatise on currency reform, and

after

that matter has been given sufficient attention

be necessary

make

to

close investigations about

will

it

two other

items of great importance for the future currency of China,

viz.

the balance of trade and the balance of payment, about

which extensive information

have

will

to

be collected and

analysed, and:

new

the

organisation for the existing mints in China,

necessary, the establishment and organisation of one or

new
will

mints,

have

There

where the actual work

of the coinage for

be found hereafter two Appendixes,

will

about monetary matters in Holland and

originating

more
China

be performed.

to

chipelago.

or, if

Their publication
a

in

conviction

is

in

C.

and D.,

the Dutch Ar-

not an effect of chauvinism,

that

things

were better

in

Dutch speaking countries than elsewhere, but our only

consideration

been that these matters are

has

known, whereas monetary questions

Straits Settlements,

Mexico,
last

to

who have

still

little

in British India, the

Siam, the Philippine Islands, Japan and

all

reformed their currency during the

common knowledge owing

publications.
Foremost among

twenty years, are nowadays

a

number

of

excellent

these publications are those

on International

by

the

American Commission

Exchange and the Government

at

Washing-

ton, to

which such experts as Professor Jeremiah W. Jenks.

Hugh

H. Hanna, Charles A. Conant and other prominent

men, have

lent their valuable support.

In view of the excellent results, which have been obtained

by the Netherlands and by Netherlands India

in the

matter

109

banking policy and monetary reform, especially

of
last

twenty years, whereas,

cally,

blems as are now

would be

useful

supplement

be solved

to

to

much

in China,

the

same pro-

we thought

it

to those reforms as a

attention

call

well as practi-

as

theoreticall}'

Netherlands India had to solve

in the

about monetary ques-

to the extensive literature

tions already published in other countries.

Without going,
tails,

we hope

for the present, into

that the outline

may convey an

preceeding pages

idea of what

as a possible solution to the Chinese

we have

In this volume

which

solution

will

more extensive

which we have given

monetary problem.

possibly avoid disturbances such as

and which purports

how can

consider

suggest and to explain

tried to

have been connected with currency reforms

ries,

we

de-

in the

to give

in other count-

an answer to the question:

a stable currency be established in China, which

combines the following principal characteristics

1.

that

be serviceable during a preliminary period

it

which

in

it

circulation

will

of

be necessary

still

sycee

dollars,

to

maintain a

and copper cash on

the present footing;

2.

that

it

be serviceable as long as

to issue

token coins of

silver,

it

is

yet impossible

which are a necessary

consequence of a gold standard or a gold exchange

standard S3rstem
3.

that

it

will

not run

the

risk of a

break-down, on

account of an adverse balance of trade or of payment

4.

that
of

it

will,

from the

speculations

in

silver

would be unavoidable

new

unit

moment, obviate the

first

evil

and commodities, which

as long

had not yet been

as the value of the

fixed;


5.

that

will

it

offer

long period

fairty

110
the
of

advantage

additional

new

population can become familiar with the

During

this period

equal

facility,

other

from

the

system.

both systems must be used with

one not necessarily ousting the

place,

its

of

during which the

transition

so

that

the whole currency

reform could be carried out very smoothly and no

final

adoption of a gold exchange system or a gold system,

as

made
6.

system for the whole country, need be

a single

that

country were really ripe for

until the

will in the

it

relations

meantime assure China's foreign

with respect to loans,

(also

certainty of a fixed unit,

if

capital

which

is

etc.)

of vital

of

the

importance

be attracted from abroad

to

is

it;

for the

development of the country;

7.

that

it

will offer

new

least disturb the existing

unit,

which does not

agreements, and

is

in the

based on

new unit being

a subdivided part of one of the most common taels,
in order that all existing agreements may without
difficulty be fulfilled in the new unit;
that it will offer a new unit, which is not too high
the present circulation of taels, the

8.

in value, since

of

too

many

would otherwise cause the discomfort

it

subsidiary coins, and have a tendency

to elevate prices;
9.

that

so

it

will

high an

avoid

new

the issue of

intrinsic value, that

prove too high on a slight

silver coins of

they would already

rise in the price of silver,

with the result that they would have to be demonetized

countries

before
(as

the

token

coins

has been done with

of

other

Asiatic

the Straits- and

the Philippine dollars), which measure would practically

amount

to another currency reform.

The following

an outline of the proposed progress

Currency Reform.

is

of the

Period.

1 St

The very
gold

unit

as

be the adoption

step must

first

foundation of the

of a future

new

system,

in

order to avoid speculation on the announcement of

the gold par, and also to avoid that the

2.

be raised

later

on have

The

organisation

to

of

bank

as a central

4.

The

introduction

bank

new gold

of account for

book

Securing the

co-operation

banks and

of

Ta

issue,

Ch'ing

or

Bank

whole country.

for the

of the

would

unit

nominal value.

to its future

central

otherwise the reorganisation of the

3.

new

credits

of the private

unit as a

and book

money

transfers,

of the foreign

exchange

Chinese banks and bankers

for the introduction of the

new gold

unit into their

bookkeeping.

banknotes based upon the new gold

5.

The

6.

The accumulation

issue of

unit.

of a gold reserve against the afore-

said banknotes.
7.

The

regulation

of the

management

of this gold re-

serve.
8.

Eventually declaring the banknotes legal tender.

9.

To make

close

study

of

the conditions of the

balance of trade and of the balance of payment for

China

Period.

2nd

10.

The

establishment of weight, fineness and alloy of

the token

coins and of the

by preference
1 1

112

The

new

subsidiary coinage,

the manner mentioned on

in

issue of these token coins

and subsidiary

95.

p.

coins,

and simultaneously:
1

2.

The accumulation
token

3.

If

coins

gold reserve

of

and the regulation

of

and issue

desirable: the coinage

against

of gold coins,

preference in the manner mentioned on

if

desirable,

ticular

some

par-

gold coins as legal tender, and the

foreign

The proclamation

certificates.

as unlimited legal tender of:

the silver token coins of

a.

by

Also,

p. 94.

the temporary admission of

temporary issue of gold

14.

the

management.

its

unit

and

2 units;

the above mentioned gold coins and eventually

b.

the gold certificates.

Period.

3rd

5.

The gradual withdrawal and subsequent demonetization

of

the

old

The above program

whole

in

silver dollars, as far as necessary

and

of the old sycee,

could,

of the present copper cash.

if

new currency law, and

desired,

be contained as a

the Executive could be giv-

en authority to appoint the time for the gradual introduction

in the aforesaid

order of each of the measures No.

The whole plan could

one single Taw.

thus be fixed

by

to 15.

anticipation in

PART
Some

II.

further details about the significance of the Gold

Exchange Standard System and

We
1

have already incidentally suggested above (on page

that

2)

application.

its

it

would be desirable

to give

some

further expla-

exchange standard system, because

of the gold

nation

this

form of a currency vpould probably have a particular interest

for China.

we

It

has also been

set forth (on pp. 10

12) what

understand by a gold exchange standard, whenever this

conception

The

mentioned

is

form

purest

system

standard

is

in the present treatise.

of this gold

exchange

of

application

at

present to be found in the Straits

Settlements and in the Philippine Islands.

Another example however,

wider importance,
in

Netherlands

completed
possible

is

offered

East India.

of this system,

and one

by the history

course through the various phases which are

with

a gold exchange system, whether in a pure

bear out

the

truth

of

and

it

will

is

limping

pure

gold

therefore

show

in reality a species

that the transitions

between those various phases, including the

is

what we have observed

exchange system

of the limping standard,

it

to retrace this evolution.

before, viz. that the gold

to

now almost

its

worth while
will

much

of the currency

This country has

condition or mixed with other elements, and

It

of

standard and,
standard,

if

final transition

necessary, perhaps even to

may be performed

very smoothly

114

without even making the population conscious of any

and

change

monetary system under which they

in the

similar evolution

is at

live.

present taking place in the Straits

Settlements and in the Philippines, and there are also signs

an analogous

of

development

in

the

currency of British

but nowhere else but in Netherlands India has

India,

reached

such an advanced stage and does

it

it

offer such a

complete image to the observer.

separate investigation

of

this evolution will therefore

have the advantage, not only of giving an insight

in the

true character of the currency systems of these four coun-

but

tries,

especially

reform in China.
evolution,

showing the wa}-

of

for a

monetary

namely highly probable that a

It is

at least in the

main

similar

be necessary

points, will

in

China, before the most efficient sort of system can be reached.

It

be useful for China

therefore,

will,

the history of

the

to investigate

currency in the aforesaid countries, as

well as to consider the reforms which took place in Japan

and

Mexico.

in

The

outline of the present treatise does not allow of a

profound examination of these matters and

restrict ourselves to a

In the
of
is

first

the

place

at present in the

because

it

is

some

the Straits

Five

shall briefly retrace

Indian

currency,

characteristics.

the development

first

because

this

most advanced condition, and secondly,

probably

of other currencies.

point out

few of the most important

we

Netherlands

we must therefore

less

well

By way

known

than the history

of comparison

we

shall then

differences from the monetary conditions in

Settlements,

distinct periods

the Philippines and British India.

can clearly be discerned in the mo-

netary history of Netherlands India, viz:


Irt

Before

Period.

rency,

the

had

silver

a very serious redundancy

to

copper

The government lends

vigorous assistance by the issue of silver

withdrawal

Unmixed
(then

of

gold exchange system

the

of

exchange system).

silver standard

by

certificates;

copper surplus from circulation.

application

silver

the

cur-

Trade was much hampered.

1845-1854 or 1859.

Period.

The

disappeared.

rency was debased.

2nd

confusion in the cur-

In conformity with Gresham's law

of copper coins.
all

Great

1845.

owing

chiefly

115

act of

of silver standard coins

May

1st

Adoption of the pure

1

Large imports

854.

and withdrawal

of the silver

certificates.
3rd

Pure application

1854-1877.

Period.

of

the silver

standard system, with silver as the standard of va-

Extensive circulation of silver standard coins,

lue.

and consequently no further reason

exchange system.

tion of an
4th

1877 until recent years.

Period.

der piece
of

of

28th

to the

tender.

legal

silver

1877.

The

silver standard coin is re-

rank of token

Owing

to

coin,

though remaining

continuous depreciation

these silver token coins

as gold

otherwise

ten guil-

the necessity for a gold exchange system

as regards

much

The gold

introduced as gold standard coin by act

is

March

duced

for the applica-

is

is

revived, inas-

neither found in the circulation nor

present

in

the country to any important

extent.
5th

Period.

Not

3'et

clearly discernible, but probably de-

veloping owing to large imports of gold.

ition

ard

The trans-

towards a pure application of the limping standis

being made possible.

~
now

Let us

116

subject these various periods to a

somewhat

closer examination.

The

isi Period.

situation

was not

that period

in

Netherlands

during

India

the present state of affairs in

unlilte

China.
In the years preceding 1845 the government had

made

the great mistake of issuing excessive quantities of copper

whereas the copper currency had even been raised

coins,

by law

was

to the

rank of legal tender

output

government mint,

the

of

on a

place

quantities
factories

for

for

instance

way

into the circulation.

At

diplomatic

Huge

came from England, where some

found their chief occupation

false coins.

took

counterfeiting

very serious scale and important amounts of

counterfeit coins found their

to

Nor

any amount.

for

the production of these copper coins restricted to the

last these practices

No

intervention.

in

manufacturing these

came

to

an end owing

measures whatever were

taken by the government to check the superabundance and

the inevitable consequence

was

that, in

conformity with the

law of Gresham, the whole circulation of

Even the stock

ed.

of metal of the

silver

Java Bank, the bank of

went the same way, with the exception

issue,

was export-

of only a

few

thousand silver pieces.

The Java Bank was consequently obliged

redemption of

its

became more and more debased.

still

since copper, which

chandise could

to

stop the

notes in silver, and the copper currency

Trade came

to a stand-

was the only money in which mer-

be paid, was of course unsuitable

for

any

but the smallest transactions.

At
was

last

the situation

became

compelled to interfere in

2nd

Period.

so serious that the

government

an energetic manner.

The measures which

the government could

117

take were hampered by the fact that silver was no longer

available

country and that fresh imports of

the

in

had shown, were perfectly

as the last years

metal

again

disappeared

the colony.
(1)

It

useless, since the

was brought

it

was therefore decided in the year

discontinue

to

soon as

as

coinage

the

copper

of

silver,

coins,

into

845

and

to

prohibit their import under severe penalty;

kind

issue

to

(2)

paper

of

the

currency,

so-called

silver certificates".

These
silver

was not

these

certificates

if

the

kept

really

would

represent silver but the

to

in reserve.

have

therefore

depreciation of

been inevitable

government had merely supported them with the

weight of
the

pretended

certificates

home

own

their

responsibihty and with the credit of

special guarantee

country, without giving a

special guarantee

Such a

their metallic value.

as to

was given

to

these certificates by the fact that the government undertook

them

to accept

taxes and duties,

which

any amount, not only

for

in

payment

of all

but especiall}' also in payment of drafts

the government would be prepared to issue on the

Netherlands treasury at ten months from date, and which

were payable there

in

hard

silver coins.

In this

way

the

holders of the silver certificates obtained the certaint}' that

an}'

amount

of

these

could be converted into

certificates

no other deduction than of such

silver standard metal, with

expenses as found their expression

viz:

in

the rate of exchange,

the expenses of shipping from Holland to Netherlands

The

India, including insurance

and

was calculated

cent per annum, and amounted

at

per

loss of interest.

therefore to 5 per cent for 10 months.

sundry

heavy

expenses
at

incurred

that time,

by

and the rate

Freight rates

transhipment
of

interest

exchange

were

and
very

for govern-


ment

moved consequently between

drafts

about

per cent over, and

the

limits

of

per cent under par. This did

however, impair the merits of the system.

not,

The

silver

abroad

backed

certificates,

coins

in

actual

coins for

100%

circulation,

The success

of

be desired.

short

space

legal tender for

the

rate

for the

copper

20%

copper

of

measure has been as complete as

this

Confidence was restored within a very

time,

of

copper

the

back within reasonable

government

of

redundancy

the

until

was driven

circulation

and a revival

limits

amounts

Considerable
sold,

made

exchange

in

at

manner by payment

in silver certificates.

could

were

in this

currency, were

in real silver

any amount and were issued

in.

118

of

of trade set

bills

on Holland

copper had

disap-

peared.

These
until

year

the

colonies
the

however, remained

silver certificates,

promulgation

the

after

by which

1854,

standard.
of

In

full

the last

silver

equivalent

principles

for the Archipelago,

certificates

were withdrawn

hard silver cash.

in

and based on

were sent from Holland, so as

form a metallic circulation

1859

act in

and following years large

1854

coins

silver

in circulation

new currency

act the currency system of the

was established on sound

silver

quantities
to

the

of

and

in

at their

They had only acted

as a transitional currency.

This monetary reform cost the Netherlands Indian govern-

ment a sum

was a pure
sound

of

twenty

loss of

currency system was

satisfaction

as

guilders which, directly,

money, but the absolute restoration

The currency system

We

million

long

as

of a

well worth the sacrifice.

of Netherlands India has given full

it

was based on

have already mentioned the

the act of 1854.

circulation of

some kinds

of

119

foreign silver coins in various parts of the archipelago, and

have described, on

32

p. 31

the recent reforms by which

they

were expelled, so that no further mention

need

be made.

Their

we

was

however,

circulation,

of

them

entirely

independent of the actual currency system of Netherlands

India.

As
the

common

but

silver,

fore

at

was the

this

except for England, and the system would theretime have

that

been

This will interest those

because

It is true that

standard of value in those years was not gold

to
it

be a

shows

styled

silver

exchange

it

was fundamentally the same-

who

believe the gold exchange

standard; as a system, however,

standard

application of

first real

exchange standard as a system.

gold

the

know,

as I

far

scientific invention of

that this system

only recent date,

has already attained a

respectable age.

3rd Period.
1854,

1st

The large

This

stage begins with

whereby the

the

act

of

May

pure silver standard was adopted.

and V2 guilder were declared unlimited legal tender and measures were taken
to

silver pieces of 2^/2,

keep the circulation

limits.

to accept subsidiary coins for

amounts exceeding ten guilders

cent.
to

two guilders

for

in

^/^

exchange any amount

of

and

guilder pieces,

^/jq

copper coins of

government

Aloreover, several

narrow

of subsidiary coins within

Nobody was compelled

or exceeding

silver

offices

2^',^,

and

1/,

were appointed

and copper subsidiary

coins exceeding ten guilders for silver standard coins.

In short, the system

but excellent

The wants

embodied

has given none

in this act

results.

of currency

were regularly met

ernment by means

of imports of silver coins

conformity with

duty

its

to

bjr the

gov-

from Flolland

provide sufficient

money

in

for cir-


culation.

the

Inasmuch

120

as the silver standard coins, according to

were the same

act of 1854,

Netherlands India,

it

for the Netherlands as for

came about

as a matter of coincidence

same coins as were imported for currency purposes

by the government could also be imported by banks and

that the

merchants as

a form of settlement of the balance of pay-

ment between both

The

countries.

result

was

the

that

stocks of metal in the banks as well as the silver standard

coins

in

circulation

purpose of settling

could

on

both sides be used for the

this balance.

It

is,

therefore, clear that

under these circumstances there was no longer any reason

for

the application

of

an exchange system", since there

was no longer any need

for

artificially

maintaining

the

nominal value. Silver was namely at that time the standard

of value

and no difference was supposed

the nominal and the intrinsic

to exist

between

value of the silver standard

coins.

In reality, however, this supposed equality of values was

not complete.

Silver in India

more than

Europe because

freight,

similar
in

in

insurance,

expenses.

loss

of

was namelj- worth somewhat

its

cost price

interest

during

was

raised

by
and

transport,

This difference in price found utterance

the rate of exchange and, owing to the fact that these

expenses were

still

rather heav}^

exchange could amount

Practically this

the fluctuations in

the

to several per cent.

amounted

to a higher value for silver in

India than in Europe. Therefore, as soon as coins had been

brought to India and had found their way into the Indian
circulation

then

they became a commodity which had

now and

great attractions for British India, the Straits, Japan

and China.
to seize

It

and

was

easier

and

less

expensive for these countries

to collect silver coins in

Java and

to ship

them

Hongkong

Singapore,

Calcutta,

to

America

order silver bullion from

was

121

that important quantities

was a disadvantage

were thus re-exported

and

it

is

to

result
to

be

obvious that

Netherlands India.

to

order to maintain the currency at an adequate level,

In

was thus necessary

it

The

or Europe.

sold as bullion in the aforesaid ports,

this

Yokohama, than

or

import far larger quantities than

to

were actually needed, entailing heavy expense. This accounts

a large

to

coins

that

extent for the extraordinary amounts of silver

were imported during

became

these silver coins

period, until

third

less appreciated as a

1868 and went on declining

in

this

in

commodity

value after 1870, along

with silver metal.

This third period

in

the monetary history of Netherlands

India constitutes an epoch of great expansion in the resources

these colonies.

of

This was largely due, no doubt, to

the monetar}' improvements,

whereby a regular trade with

the most distant parts of the world had been

on a fixed basis
during

of value.

this period

business

started

agencies.

Many

made

possible

new concerns were founded

and several new Dutch and foreign banks

in

India,

either

through head-offices or

The exchange business passed more and more

into

the hands of these banks, and the government only continued

its .sales

of drafts as far as these resulted

produce from the government

land

in

order to be sold there.

ernment were thus limited

plantatirnis,

The

to its

from the

sales of

shipped to Hol-

transactions of the gov-

own requirements and

took

place no longer with a view to a maintenance of the exchange.

An

important

change

in the situation

was going

to

be

the result from a measure which inaugurates the:

4IJ1

Period,

though

the true importance of that change

was not generally recognized until

much

later.


This momentous

122

measure was the proclamation

currency act of March

28""

of the

1877, which introduced the gold

ten guilder piece as a standard coin for Netherlands India.

This measure was chiefly due to the perspicacity of Dr.

N. P. van den Berg,

Bank and

now

is

bank

central

issue

of

who was

then president of the Java

president of the Netherlands Bank, the

been the persevering champion

gold

the

of

and

nies,

much

van den Berg has

for Holland. Dr.

of

the early introduction

standard coin as a legal tender for the colo-

in this quality

he had to clear the ground from

The very

misapprehension.

which

satisfactory results

have now been obtained during these 35 years show how

great the service was which he has rendered to his country,
as the first pioneer in the East for the application of a gold

standard, and

how

as all the other

The

with the exception

in the East,

have also been obliged

of China,

to adopt a gold basis.

silver standard coins in Netherlands India threatened

the time to

at

absolutely right his predictions have been,

governments

become involved

general decline of

in the

silver

and under such a contingency a complete

of

prices in the country would have taken place.

all

situation

was complicated by

dislocation

The

the fact that the Netherlands

had already adopted the gold ten guilder piece as a standard coin by the act of June

6""

1875 so that the connec-

tion

between the currency systems

had

existed for so

both,

many

of both countries,

which

years to the great satisfaction of

had been considerably changed.

The

situation

had

indeed become precarious.

From many
position

was

gold standard.
that,

like

all

sides

carried
It

the

in

on

Netherlands India an active opagainst

the

introduction

of the

was asserted from a conservative

surrounding

Eastern

countries,

side

Neth-


erlands

The

India

not

did

government,

123

want a gold but a

silver standard.

never heeded

however,

and the Dutch colony was the

remarks

these

among Eastern

first

coun-

adopt a standard based on gold. Netherlands India

tries to

has had ample reasons to be satisfied with this timely conversion

for

and persistent troubles which have

great

by

experienced

none

end,

resist the

driven

countries,

the

direction

all

more or

gold standard,

of

later

on been
In

countries.

the

China alone excepted, could

flowing tide and they have

in

enjoyed

Asiatic

other

the

all

of these

wards the use

the

safeguarded against the

has thereby been

it

less

leas

at

of a gold unit. Netherlands India

been
to-

meanwhile

a very quiet monetar)'' policy, which lasted during

third

as

well

during

as

the

period

fourth

of

its

development.

The

introduction, however, of the gold ten guilder piece

a standard coin (which took place for Holland in 1875

as

and

for the

The

silver

Dutch Indies
standard

Silver
for

It

is

on

its

behalf.

this

dul}' in
It

this

is

Though

token

at

its

nominal

was done without any

the government has persisted

it

is

never

jlikely to

deny

this respect.

worth while briefly

especially

coin
to

of the central
It

the

government or without any measure

ever since in this passive attitude

its

to

the attending consequences.

maintaining the token coin

remarkable that

direct interference of the

taken

all

effects.

went on declining and the necessity was thus revived

artificially

value.

were thereby reduced

coins

rank of token money with

had far-reaching

1877)

in

to relate the

has been kept at a

manner

paritjr

in

which

with gold and

examine what has thereby been the function

bank

of issue.

has been repeutedh' attempted to

make

the gold ten


guilder piece

a part

124

of the active circulation, but thus far

these attempts have alwa)'s failed.

fore,

bound

monetary sj^stem as long as the

show signs
had

this

of

silver

a depreciation, and

be prevented

to

The population was,

remain unconscious of any change

to

any

at

it

therein the

token coins did not

was understood

that

Moreover, the free

cost.

coinage of these coins had already been finally discontinued

long ago,

viz.

in

There was thus no outward

875.

cumstance whatever

to

show the population

was henceforth based upon

When

was found

it

absorbed

by the

that

its

cir-

currency

gold.

gold coins could neither be

that

nor put aside in a sufficient

circulation

quantity to serve as an inland gold reserve for the support

of

the token coins,

to

be found

The

became

it

clear that another

way had

to maintain their parity with gold.

circumstances have been

following

conducive to

that end:
1.

These

been accepted

at

by

officers

all

have always, and

silver coins

public

their

any amount,

nominal value by the government,

and

institutions,

and conseqtiently by everybody

2.

for

in

always been taken up

in

all

the banks,

else;

Inasmuch as these coins are

which are circulating

by

still

the

same

as those

mother country, they have

the

Holland

at their

nominal value

if

sent back to that country;

3.

The only

possible difference in

tween these coins

by the expense
of

interest

as a rule,
for

home

at

exceed
or

in India is therefore

of shipping, including insurance

during

the exchange

home and

exchange value be-

transit.
^/^

of

Nowadays

and

loss

these costs do not,

one per cent on the value, either

outward shipments; and the

are,

caused

therefore,

oscillations of

at present confined

between


and

991/4
5

100^/4 per

cent, as

Everybody
in

draft,

exchange

in

Holland,

extreme

99^/g

by telegraphic

either

nearl}'

always

orders

figure

between the extremes

In this

manner the value

lands

India

and

may be

it

been

has

been willing

of the token

the

possibility

some extent

obtain

to

last

lOO^/g per

transfer or

by

and the

execute such

to

just mentioned.

coinage

in

Nether-

with complete success,

maintained

described to

as a second appli-

exchange standard",

cation in that country of the gold

of

and

for these silver coins in India,

banks have
at

During the

limits.

has therefore been able to procure

in India

payment

moved between

years they have even

cent.

125

viz.

elsewhere the gold value of

the coins in India.

Theoretically the

same monetary standard

mother country and

used

cally

in the colonies

by each

in

but since

prevails in the
1

877

it is

practi-

a different waj^, because Holland,

with the same kind of silver circulation, does not, of course,

vise
It

a gold exchange system.

particularly interesting to see

is

bank

the Java Bank, as the central

ces

by what circumstanbeen

of issue, has

gradually

attracted

towards the exchange market and has

ultimately

relieved

the

government

the

of

care

of

main-

taining the specie parity towards foreign countries, though

not relieving the government of the obligation of assuming

this

function

should

pay

and

in case the

powers

of the central

bank

fail.

Owing
to

anew

to the increased attention

to matters of international

less

exchange

it

became

advantageous for the government to do

business.

exchange banks,
ed when

which the banks began

exchange,

the}'

to

It

was more or

whom

less

its

less

own

given over to the

of course a turn

had

to

be allow-

took over the governm.ent drafts, and

the


was

result

126

government did not get the best

that the

was therefore decided

It

and

altogether

come

to

to

to an

agreement with the central

bank, which could act in a more businesslike

government.

the

were

direction

fixed

rate

All remittances

par,

/.

than

India in either

be financed by the Java Bank

to

of

way

which the government

made between Holland and

required to be

prices.

withdraw from the market

at the

without any loss or profit to the

c.

government. These remittances are always made by telegraph

and the Java Bank must

always

course

take care that

in a position at short notice to transfer

government may require

the

as

of

to

it

is

such amounts

be made

for its

own

account, either in the one direction or the other.

Since

this

agreement has come

the exchange market

is

into force the

given over to the banks.

however, the Java Bank also enters

this

whole

At

of

times,

market, not for the

purpose of competing with the exchange banks, but only

own hand

in order to strengthen its

with regard to

its

duty

towards the government and towards the public, as holders

of

its

notes.

The Java Bank

bank and

and also

has, moreover, the position of a bankers'

alwa3's ready to

is

to

the public

graphic transfers at
the

buy from, or

to sell to the

an)^ desired

its official rate.

As

amount

banks

in tele-

a rule this rate

is

export and import of specie, and

close

to

when

the market supplies of remittances are exhausted the

bank

central
that

at

for
to

rate.

many
finance

limits

is

for

found prepared to provide any amount

Of course

its

means are not

unlimited,

years the bank has been able, in the

but

last resort,

whatever remittances were required

in either

direction.

By

acting in this

way

the

bank procures

practically, as


as

far

lies

currency

in

as

same way

power, a guarantee for the value of the

its

well as for the value of

as the

government

the

government

that in

now

means

and

through

cie shipments,

own

notes, in the

of the Straits Settlements

of their

and bu3dng remittances

selling

its

and

the Philippines maintain the parity of

of

their silver currency

is

127

currency notes by likewise

within

the limits of spe-

This means

a gold reserve abroad.

the Dutch Archipelago the gold exchange system

practically
of

being applied by the central bank, by

foreign

its

exchange

polic}^

suming any express responsability

in

though without
that

respect.

really interesting to see that this variety of the

proved a complete success

Shipments of specie

as-

It

is

system has

(I).

do, of course, occur

under

this parti-

cular application of the system as well as under other forms.

As

far as these shipments are

ses

they

place,

as

take

place,

or

at

all

by order and

before,

wanted

for currency purpo-

events they ought to take

for account of the govern-

ment, and this applies especially to the providing of an

adequate amount of silver currency for which the mint has

been closed against the public since 1875.

In

addition

thereto

and then required

ment, especialh'
great

shipments of metal are

other

now

for the settlement of the balance of pay-

with the mother countr)^.

Owing

to the

prosperity of Netherlands India during recent years,

the balance of trade and the balance of pa3'ment have as

a rule been
of

specie

(1)

in

favour of the colony, and considerable amounts

have consequently

See further about this

Java Bank, especially the

last

so hoen publiahed in English.

been imported during those

matter the annual reports of the

report 19111912, which has al-


by

years

the banks and

128

by the

For the same rea-

trade.

sons as were mentioned above the Java

Bank has extended

care, as far as necessary, to the financing of these ship-

its

The bank has been prepared

ments.

to

buy any amount

from the exchange banks and from

of telegraphic transfers

private firms, thereby taking over their functions with re-

gard to imports of specie as

able,

balance

the

settling

of

far as these are

and

trade,

needed

for

has therefore been

it

during several years of favourable balances, to increase

the stock of metal in the colonies, and also to turn a portion

these balances into a considerable increase of

of

its

gold

reserve abroad.

These reinforcements
partl)r

and

gold

in

of the foreign gold reserve consist

silver,

which

Holland by the Netherlands Bank

done by the Bank

is

India

Europe,
the

and partly
in

reports

in

or

England

of

gold

Germany, which

it

the

in

can

bills of

exchange bought

of claims

use

same way

as

for account of British

short loans on

in

bank has acquired a supply

and

kept earmarked in

is

at

call.

In this

in

way

on England, France

any time

to

pay

for

shipments of foreign gold to India when these are considered

desirable

with a view to the monetary position

requirements of the colony.

gold

(mostly

sovereigns),

and the

Important amounts of foreign

and

in

recent

Netherlands gold coins, have been shipped

years
to

also

of

Netherlands

India as an outcome of this policy.

In

connection

passing,

that

with the foregoing

nearly

the

whole

of

we may

observe in

the gold reserve thus

held in Europe was originally accumulated from the proceeds

of

bills

of

exchange and telegraphic

been bought
crops of

the

transfers

which had

in Netherlands India, in order to finance the

colony.

In

other words,

the

bank may be


said

support the internal development of the colonj^ by

to

the very act of replenishing

We
been

129

must

still

briefly

gold reserve.

its

revert to another fact which has already

stated

passing, viz.

in

the Netherlands

that

legal tender coins, in silver as well as in gold, are the

which are current

those

as

two

entirely different purposes,

distinguished, viz.: as a

and

Netherlands India; these

when imported from Holland, can

coins,

for

in

means

therefore be used

which ought

to settle the

as a currency for the colony.

also

same

to

be clearly

balance of payment

This circumstance

has greatly supported the circulation and the practical result

was that, during recent

as far as
at a

it

years, the supply of silver currency

was required

proper level

has

in order to

maintain the circulation

very large extent been imported,

to a

not by the government, but by the trade.

part

these specie imports

of

Bank.

last

By

far the greater

were controlled by the Java

Private banks have only contributed to these imports

by way
be

of exception,

3'ear

sent

by one
over

as

of

and a large sum which was imported

a matter

exchange considerations.

central

of

had

of

hard cash against

to serve as a

from deposits and balances

bank cannot but applaud

during an eventual

crisis will

reinforcement
its

increasing

in current account.

The

own

task

this policy, since its

thereby be lightened, and since

this is in

accordance with the policy that

Bank

England and the Deutsche Reichsbank,

of

to

independent of

principle,

It

own supply

of that bank's
liabilities

exchange banks was ordered

the

is

advocated by the
viz.

that for

the reinforcement of their cash reserves the private banking

concerns ought not to have recourse to the central bank alone.

Not

until

89 1

was the Java Bank allowed

to hold part of its assets in

same year

it

established

bj'

Holland or abroad, and

a branch

office

in

charter
in the

Amsterdam

130

The inauguration

for the administration of these funds.

new banking and currency

this

dates therefore from that year.

bank

policy of the central

At

first

of

only a vcr\' restricted

use was

made

ment

Netherlands India and the general widening of

of

new power

of this

but the increased develop-

the bank's field of action, which resulted therefrom, have

naturally led also to

an extension of the bank's operations

in that direction.

However,

as has already

had arisen between the

been observed, some confusion

dut}- of the

government

to supply

the

community with a

the

duty of the trade and the exchange banks, supported

by the central bank,

sufficient

to

amount

ship the

metal

needed

increasingly

items, viz. the shipments of currency for

and

for currency purposes only,

by the trade and by the banks

extra-colonial liabilities.

The

two

distinguish

to

difficult

in

all

it

be-

different

government account

and the shipments of metal

in settlement of international or

confusion, moreover,

was enhan-

ced by the fact that Netherlands India has no mint of

so that

the

for

settlement of the balance of payment. In other words,

came

and

of currency,

its

own,

the coins for the use of the colonies must be minted

Holland and shipped from there to the colony.

As

long as almost none but silver coins were used

circulation of the British Colonies

of

territories,

inasmuch as

from those

that

of the

their silver currencies

mother

countries,

be used for the settlement

however, that

and

kind was not likely to occur

confusion

in this

of

were

first

mutual balances.

respect an important change

speak about the

in

those

different

and could therefore not

to take place in British India as well as in the

pelago. Let us

in the

in the Philippines, a

latter,

It
is

seems,

about

Dutch Archi-

and thereby resume

our survey of the evolution of the currency

in that country.


During the
tral

last

131

few years Netherlands India and

its

cen-

bank have gradually and rather unconsciously come

new

which we are inclined

situation,

^th Period.

Until

recently

Holland used to be limited

we have

the imports of specie from

even, as
the settlement of balances,

to silver

already observed, for

token coins,

because there was no use for any other coins

first

to

to distinguish as a

in the

bank

colonial circulation and, secondly, because the central

Holland only wished to part with silver coins inasmuch

in

as since 1875 the supply of these coins in the Netherlands

had

always

been

This

excessive.

supply,

however, has

gradually decreased owing to larger requirements for the

circulation, especially in

Netherlands India, and the govern-

ment has even been compelled

for

acts,

Holland as well as

to

for

amend both currency

Netherlands India, so as

be able to resume the coinage of new

to

from bullion.

silver

token coins

In order to defer as long as possible the

carr)dng out of this measure,

which

might under circum-

stances cause a weakening of the monetar}' situation

stock

of

needs of the currency,

it

has since lately been deemed

Holland

and

to

gold whenever export of metal was required for the

of balances

the Netherlands
that
for

its

the

the

were again augmented beyond the actual

silver

preferable to keep the silver in

ment

if

of

Bank

pa3'ment.

Only

export
settle-

since last year has

co-operated in this policy and, seeing

redundant stock of silver had disappeared,

it

has,

time since 1875, been willing to part with

first

gold for other than international purposes.

Whereas a
guilders

in

Netherlands
lation,

the

short

gold

time

ago only a couple

were kept

of

in the vaults of the

India and none whatever

was found

banks may now be estimated

million

banks

in

in circu-

to hold at least


38

millions

made
is

make gold

to

too early to say

a period of

if

now

token coins are

gold

these attempts will

lying

the result,

in

now

now be successful,

certain that within

is

to a large extent protected

the

country

itself,

situation

by a supply

with the additional

payment against Netherlands

By

largely be settled in gold.

change the foreign reserves have become much

maintenance of the token coins and

to the

It

different, in this sense that the silver

effect that eventual balances of

India could

it

more than one year the monetary

little

has become entirely

of

coins a popular form of currency.

may be

whatever

but,

renewed attempts have been

while

gold,

of

132

it

this

sudden

less essential

could even be

contended that Netherlands India does no longer

rest

upon a

gold exchange basis but has passed to a pure adoption of the

limping standard.
there

much

is

to

If this

be said

contention

is

right,

and we think

in its favour, then this transition

has been so smooth and gradual that no outward sign of that

important change has been visible in every-day

member
tary

of the

position

any

life to

community, though the international mone-

of Netherlands

India has thereby been con-

siderably strengthened.
If this is

the right

way

to look at the

taken place in Netherlands India,

of

the

elasticity

of

the various manners in which

change from one stage

that

rather

in

some

name given

in

it

It

to

of

can be applied, while the

would

be performed

in a

also confirm our im-

cases the gold exchange system

preconceived system as such.

stage

gives a striking proof

to another can

very smooth and simple way.

pression

it

exchange system, and

gold

the

change which has

temporary

situation,

In those cases

it

than

is

indicates a

the condition of the currency ratlier than an essentially

different species.


Let us

now compare

133

the evolution which

we have sketched

the preceding pages with the application which the gold

in

exchange system has found

Philippines

the

and

in the Straits Settlements

and

with the currency conditions of

also

British India.

There are some striking differences between the

appli-

cation of this system in Netherlands India on one part and

in

the Straits Settlements and the Philippines on the other.

One

of these differences has already

a.

been pointed

that no currency paper exists in the

whereas no central bank

nearly

fiduciary

in the Straits

The consequence hereof

Philippines.

India

found

is

whole

the

of

in the

of

maintaining the

token money as well as of notes,

of

circulation,

and

that in Netherlands

is,

task

the

out, viz.

Dutch Archipelago,

with gold, rests practically on the shoulders of

at a parity

the central bank, in co-operation with the other banks, apart

of course

respect, --

from the ultimate duty of the government

in this

and

in the

whereas

the

in

Philippine Islands this

is

Straits

Settlements

incumbent on the government.

Other important differences are the following:

b.

The

silver

coins

which circulate as legal tender

Netherlands India are the same as

Straits

own.

The government

of Netherlands India has never aim-

ed at an introduction of the
a

particular

sj'stem

(if

the period between

come

in

whereas the

Settlements and the Philippines have silver curren-

cies of their
c.

in Flolland,

to

monetary
the close

we

845

gold exchange standard as

except the monetary reform

and

859),

in

but the system has

be generally used as a natural consequence of the

conditions
relations

prevailing

with Holland.

in

the

The

colonies

and

of

Straits Settlements

and the Philippines, on the contrary, have introduced the

134

gold exchange system on purpose, as a particular

Moreover,

system.

the

government has hesitated

Straits

some time before accepting

scientific

all

the consequences of this

system, whereas the Philippine government has adopted the

full

system from the very

While preparing
and the

their

start.

monetary reforms, the Philippines

Straits Settlements

had the benefit

of experiences

They

gathered elsewhere, especially in the Dutch colonies.

found

likewise that the population required no other cur-

rency but silver and subsidiary coins and

of their excessive value, gold coins

Allowing
under

a,

for the differences

and

b,

c,

we may

protecting the gold parity

on account

that,

were not wanted.

which we have pointed out

say that the general plan for

substantially the

is

same

in these

various countries.

Both

and

and

the Straits

in

ment undertook

exchange them

to

in the Philippines the

to accept silver token coins in

for gold (or gold value)

abroad

their full equivalent, less cost of insurance, freight

of

In

interest.

currency
within

first

its

by

and

at

loss

period of the reform, the Straits

however, hesitated

government,
quences of

the

govern-

any amount

accept the

to

full

conse-

duty to maintain the nominal value of the

buying

and

selling

exchange on London

the limits of specie remittances.

In the year 1906

was proclaimed

their intention in this respect

in

the following

words:

The factors which determine the

limits of the variations

of the sterling value of the dollar are the cost to

Govern-

ment of bringing out gold to Singapore and the cost of

sending gold

London.

The

to the central

market

intention of the

of the

Government

world
is,

7'iz.:

in the case


of

any dearth

currency and

of

being available

135

Colony, to issue notes by buying

the

in

event of gold not

in the

telegraphic transfers payable to the Crown Agents

don

and,

of

any excess

of currency

Lon-

and

in

event of the currency gold reserve being exhausted,

the
to

case

the

in

in

draw

notes by selling telegraphic transfers pa3rable

in

by the Crown Agents

fixed ad

2/4

provide a

in

London.

(buying)

^/^^

and

These

2/3

ii/jg

margin

sufficiently liberal

limits

have been

(selling)

and they

for all

contingencies

including freight, insurance, packing, shipping charges and

They

interest.

the extreme low water limit of the sterling value of

and

and the Government may be expected

dollar

the
ly

mark the extreme high water

will, therefore,

whenever the

intervene

distance

of

dollar

either of these limits.

..transactions as well as the profits

into the special gold reserve

of

Ordinance

of

1906,

for

within

The

profits

measurable

from these

from reminting are paid

fund provided

in

Section 73

the purpose of maintaining

(See Financial Report for the

the stability of exchange."

Year 1906, clause

is

to active-

45).

On September 22nd

1909 the buying limit was lowered

by the currency commissioners

to 2/4^/15,

by

notification to

the bankers and the public, though not by ordinance.

same

policy has since been maintained.

The

history of the reform in the Philippine Islands dur-

ing

1903

bles

which

itself

and 1904 furnishes another instance

it

the

is

difficult to

was the

of the trou-

avoid whenever the government

undertakes to regulate

countries, or
It

The

the

exchange between two

between a home country and one

of its colonies.

intention of the Philippine government, after

new peso had been

introduced, to maintain the parity


of

token coin by the sale of government drafts on

this

New York
New York
of

5/^

136

well as by drafts sold

as

on the treasury

their agent

per cent, for sight drafts and U/g per cent, for

that

owing

lippines

and other

a ready

demand

It

between the Phi-

countries, especially with the

United

was

and

i/j

^/j

to

^|^

demand

for

per cent,
drafts on

per cent.

^/g

obvious from these events, that two items are easily

confused,

especially

kes to buy and

of the

per cent, and

on the rate

later

Manilla was again reduced from

It is

New

in the

therefore decided to lower the selling

rates for these latter drafts to

respectively,

States,

existed at those rates for drafts on

It

tele-

soon became evident, how-

to the nature of trade

York, but that no drafts on Manilla could be sold

United States.

in

in Manilla, at the fixed rates

graphic transfers, either way.

ever,

by

sell

when

the government

itself

underta-

foreign exchange, viz. (aj the maintenance

gold par of a currency which

exchange standard, and

based on a gold

is

requirements of commerce

(b) the

with regard to the settlement of an international balance of

at

ultimately

by shipment

first

means

by

payment,

of

exchange

foreign

and

of metal.

The exchange between two countries depends upon the

volume and character

government department
rates are in

business and

of

to

harmony with

ascertain

to

is

difficult for a

what extent

the requirements of trade.

kind was experienced

difficulty of that

it

in

their

No

Netherlands India

where the banks have automatically followed the exchange

market, and where in the

last resort the central

bank could

regulate the exchanges, within the limits of bullion remittances,

by means

and

general discount policy.

its

bank been able

of

its

foreign portfolio,

its

balances abroad

In such a degree has the

to adapt itself to the

exchange market that


during the

four years

last

137

selling rate for telegraphic

its

on Holland has been maintained almost without

transfers

interruption at 100 per cent.

seems a

It

fair

from the foregoing that the

conclusion

community are

of

interests

change policy

when

better served

the ex-

entrusted to a central bank, because of the

is

various instruments which

has at

it

its

disposal in a

much

higher degree than a government department and also because

and more direct contact with

of its daily

In

the

call}'

apart

many

for

rupee

silver

circulation,

and

India the situation

British

ment rupee

has

course

of

again different.

is

been

long

trade.

Practi-

only

the

coin

in

from the subsidiary coinage,

years after the introduction of the govern-

as a coin, sovereigns

have only been hoarded, or

used for isolated financial transactions but have not been

circulation

in

among

sovereign as a circulating

The government

medium

of

exchange.

under an obligation

is

one sovereign, but

for

it

and
land,

it

is

that

but there

is

emphatically denied by

many

from

is

to possess

the seigniorage profits

the government
in

exchange

is

it

Eng-

based on gold,

a gold value.

made

since

built up,
1

898,

and

prepared to draw on this reserve fund

for rupees.

London, where

bottom

authorities in

the British Indian circulation

be said

at the

Meanwhille a gold standard reserve" has been

chiefly

rupees

898, at a value

no government guarantee

or that the rupee can

5 rupees. In practice the

rupee has nevertheless been maintained, since

Is. 4d.,

pay

to

has never formally undertaken to give

a sovereign back in exchange for

of

two or three

In the last

the people.

there seems to be a tendency to use the

however,

years,

This reserve

consists partly

is

now

largely held in

of sovereigns,

and

partl)^


of bills

and

the silver

reserve

138

securities payable in gold, so

which

fund.

is

held in India,

cannot,

It

it

virtually

be said

how^ever,

apart from

that,

is

a gold

be under

to

circumstances sufficient to safeguard the entire circu-

all

lation

of

rupees.

been able

far

It

true, that the

is

government has thus

continue issuing gold

to

transfers

against

even in 1908 and 1909, which were years of con-

rupees,

siderable pressure, but

the reserve fund had been com-

if

pletely exhausted at the time

the

have been under any obligation

The

Indian system

British

exchange standard, though

is

government would not

to lend further support.

therefore no genuine gold

practice

in

it

has shown a close

resemblance to such a system during the

The chances

of an

unbroken application

of

last

its

14 years.

principles are

nevertheless growing every year, since large amounts of old

rupees are constantly withdrawn from circulation through

loss,

melting down and so on, whereas the profits from

new

coinages

go

The

swell the reserves.

to

tween these reserves and the actual circulation

gradually improving and
likely that the
at its

rupee

is

it

relation beis,

therefore,

becoming more and more

always be practically maintained

will

nominal gold value.

Contrary to what has been the experience of former years

there have recently been considerable imports of gold into
British
for

India,

moving

or

of

its

whether a

made
that

the

crops.

even being used

It

seems as yet rather

distinct

At

sums

years

in

some parts
difficult to

for these remittances

on

being the cheapest form of metal shipment,

itself felt.

large

last four

is

whether gold was used

ascertain

account

and gold

(in

of
1

want
all

of

this

kind of currency has

events, the fact cannot be denied

gold

have been imported during the

908 about

millions, in

909

millions.


in

1910 18 millions and

ling),

of

silver

the treasury

in

has

Tn their Annual BuUion Letter 1911"

gradually decreased.

&

Samuel Montagu

Co. express the opinion that the

so-called never-changing East

According

precious metals.

20 millions pounds ster-

1911

in

whereas the supply

Messrs.

139

changing as

is

these gentlemen gold and

to

government notes are beginning

the predominant position which

These circumstances seem

to its use of the

to oust silver in India

it

has occupied for centuries.

to justify the question

new

not also entering upon a

British India

is

historj' of its

currency reform.

from

As

whether

period in the

soon as the gold .standard

reserve would have sufficiently increased to protect the face

value of the whole circulation of rupees against whatever

may

dangers

assail

them,

whereas

in

mean time

the

the

continuous imports of gold into the country had rendered

the supply of coins within the country large
to

safeguard the rupee, but also to

balance of payment

then

it

settle in

enough not

onl}^

gold an eventual

could be argued that British

India had reached a limping standard. This would even be

notwithstanding the absence of an

true

official

guarantee

as to the gold value of the rupee.

It

is

predicted

by some

more and more popular

that the sovereign will

as a

medium

the population of British India.

by the course
and

of events the

If this

would have

governments

to face the

among

should be confirmed

of British India, as well as the trading

the banks,

become

of circulation

of

Great Britain

community and

consequences of a similar

as we have described above and which caused

much misunderstanding in Netherlands India, As soon as

confusion

the sovereign
circulation

ment

for

in

will

have become an integrant part

Briti.sli

India as

extra-colonial

well

as

of the

a means of settle-

balances of payment, the British


Indian currency

likely

is

become influenced

to

more considerable degree by

it

has been thus

owing

140

the balance of

The exhaustion

far.

payment than

might namely have

consequences as soon as the population have

become accustomed

to

the

of sovereigns in circulation.

use of a considerable amount

similar situation

be created as existed already

rupee was raised to
to

still

of a gold circulation

to outgoing remittances of metal

far-reaching

in a

s.

4d. Before

would then

in British India before the

1

893

it

was namely

possible

export silver coins as bullion, because they were no token

coins,

the

in

now be used
The fixing

same way

as an international commodity.
of

pecially

through

reserve

abroad,

regulating

come an

as sycee and dollars in China can

the

the rupee has lessened this danger, esthe

subsequent establishment of a gold

which has proved an

currenc}^

active part

enhance the necessity

of

Should gold

efficient
itself,

means

of

however, be-

the circulation this would again

of strengthening the foreign reserves,

so as to protect the circulation against sudden withdrawals

of currency in the shape of gold coins.

In
also

course

of

time the Straits and the Philippines will

very likely have to count with a similar evolution, since

the gold coins of the mother countries are also legal tender
in these colonies.

in

their

Whatever

application

of

the

differences

system,

it

may
is

characteristic of the four Eastern countries

named, that

if

it

were possible

gold coins into the circulation and

colonial governments,

blic

for

the

gold

common
which we have

thus a

their position as regards a gold currency

become exactly the same

by the

otherwise exist

if

would

to bring their

they could be used

by the banks and by the pu-

the purpose of specie remittances.

exchange system would cease

In that case

to act, because.

141

with regard to such transactions,

by

tuted

For

it

would have been

substi-

a pure gold standard or limping standard system.

we thought

reason

this

it

would be interesting

to

point out the consequences to which this evolution has already

As

led in Netherlands India.

regards China these facts seem

to point to the necessity for that

country to

as possible a similar arrangement,

by means

be able to safeguard

its

make

of

as soon

which

it

will

circulation against exhaustive ship-

ments of currency.

The
in

four

this

Asiatic

may be

chapter

fundamental

countries

conception

which we have mentioned

said,

in

conclusion,

common,

in

have

to

which unites

a
the

most important characteristics of the gold exchange system,

viz.

that:

(1st)

under the present circumstances

all

these

four countries practically maintain the value of their silver

token coins by drawing more or less on gold reserves abroad.

They

likewise,

act

(2nd),

as

regards their government

currency paper or their banknotes, because these currency

notes and banknotes could not be adequately supported by

a promise to pay

were

sufficiently

reserves.

open

And

in

token coins unless the latter

silver

backed up by the aforesaid foreign gold

finally,

(3rd)

to

to settle their balances

thereby

to

safeguard

the

all

with the

par

of

of

them the way

home

countries

exchange,

is

and

making

b);-

remittances in metal, which for British India, the Straits

and the Philippines

consists of gold standard coins,

the Dutch Archipelago

means both gold

silver pieces, since the latter

home

country.

and

for

coins and large

are also legal tender

The gold exchange system could

in

the

therefore

practically be abolished in all these four countries, without

even altering the laws which regulate their currencies,as


soon

as

tender

legal

142

gold coins of the mother countries

could be issued in sufficient amounts, provided the colonies

be ripe

When

kind of circulation.

for that

comparing the monetary

these four

of

situation

Asiatic countries I feel inclined to think that the currency

system

in

Netherlands India

is

at present in a

more

ad-

vanced period of evolution than those of the Straits and

the Philippines and also of British India Netherlands India
;

has

already
as

acts

passed

stage

in

which the government

by way

a guarantor of the currency

ment remittances.
recent

the

In

been

j-ears

of govern-

Netherlands India this task has in

accomplished

manner by the exchange banks,

quite

in

satisfactory

of course with the support

the central bank of issue, whereas the government has

of

entirely

withdrawn from the exchange market.

shown by an example from the

the Philippines

course

the fact that

colonial

this
it is

history of the currency in

cannot be said that a regular government

it

interference in this matter

Of

As was

does

is

particularly efficient.

not

interfere

in

the

lea^t

with

the ultimate duty of the Netherlands Indian

government

to

provide for appropriate measures,

should the exchange banks and the central bank

fail in

the

accomplishment of their functions.

Since

many

years, however, as events

have shown, there

has been no need for government intervention.

I

too

readily agree that in this respect I

much from

am

perhaps arguing

the standpoint of the Netherlands Indian

currency system, with which

am most

familiar.

however, cannot be denied that during the

the system of currency and banking

in

last

The

fact,

35 years

Netherlands India

was spared the manifold troubles which have been expe-


rienced

143

by the three other

colonies,

and

this,

I think,

may

well count as an argument for the efficienc}' of this system.

We

have taken the

liberty to deal rather extensively with

some

of the details contained in this chapter

them

to a

somewhat

analytical examination

exactly facilitate the sequence of

change system
attractive

for

reform of

its

contained in

As
sider

of so

is

much

and

interest

which

country

ideas;

is

and

to subject

which did not

but the gold exis

so particularly

about to enter upon a

currency, that a contemplation of the matter

this

part

may on

account be excused.

that

the chief attractions of a gold exchange system

()

the

manner

in which, with a

more

we

con-

or less systematic

application of this system, a circulation of silver token coins

and

of

notes

can

be

maintained

at

a parity with gold

without a direct gold reserve being kept within the country

itself

and

ard coins,

practically

and

without a circulation of gold stand-

especially

exchange system and the

an}'

{6)

the elasticity of such a gold

possibility of

exchanging

it

without

shock for a more desirable form of application or for

another system of

still

greater efficiency.

Comparative Statement of Weight and Fineness

Gold and Silver Coins and Units.

of various important

APPENDIXES.
A.

Present condition of Currency in China.

B.

Present condition of Banking in China.

C.

Extract from Letter to French Consul in Batavia,

concerning

monetary

reforms

in

.Sumatra

and

Borneo.

D.

Synopsis of the working of the old Amsterdam

Wisselbank" and

For the benefit

familiar with the

its

money

of account.

of those of our readers

present state of

affairs,

who may
the

not be

Appendixes

and B. contain a brief synopsis of the conditions that

prevail in China with regard to Currency (A.) and
Banking (B).
The compilers of the China Year Book" (1912), Messrs.
H. T. Montague Bell and H. G. W. Woodhead, have written so clearly and succinctly about these matters, partly
with reference to Mr. H. B. Morse's verj' able work The
Trade and Administration of the Chinese Empire", that we
can do no better than to reprint a few passages from their
yearbook, and also some pages of Mr. Morse's book, with
our compliments and apologies to the writers.
For closer details concerning these complicated matters we
beg to refer to the extensive literature which has previousl\'
been published.
A.

now

APPENDIX

A.

Present Condition of Currency

China.

in

THE TAEL.
The Tael

is

The

fineness.

a weight of silver of a certain degree of

taels

vary in w^eight,
in

in

used in different parts of the Empire

touch and in value. Dr.

J.

C. Ferguson,

a recent article in the Journal of the North China Branch

of the

Royal

Asiatic Society, mentions seventy-seven distinct

and Mr. H. B. Morse, v?hose

varieties of tael,

article

upon

book The Trade and Admimstration of the

Chinese Empire, may be regarded as authoritative, states

currency, in his

that

he has notes

In

theory

the

of 170 different currencies.

tael

subdivided decimally into mace

is

candareens and cash, as follows:

=
=

One Tael
One Mace
One Candareen ==
But though

in

used, the actual

uates to an
as

little

mace
value

Candareens

Cash.

exchange value

when

of subsidiary coinage fluct-

tael

much as 1 800
may mean the

actual coin

is

may be

may be worth

cash, so that

one

transfer of 80 to

handled, though

its

nominal

00 cash. Different taels are in use in each province

in China, and, in

of

extraordinary degree.

(one-tenth of a tael)

is

Mace

book-keeping the decimal system

as 800 cash, or as

180 cash

10

many

instances, even in the different

towns

one province.

As

already stated, the tael

is

not a coin, but a weight.

It

Chinese ounce of silver of a varying standard of

is

which

purity,

represented by no actual coin. Taels

is

be circulated either
of

These shoes

round sum

The

never amount to an exact

practice

which are

most general use are the following

in

The Hatkuan, or Customs

which

Tael.

All

duties levied

Maritime Customs are calculated

the Imperial

to fifty

say, ten, twenty-five, or fifty taels.

of,

taels

in

in

may

native orders, banknotes, or shoes

approximate weight of from one

of an

silver

taels.

147

by

in this tael,

a purely arbitrary standard of currency, not used

is

commercial or business transactions of any other kind.

for

In theory

it

is

a pure silver

It

tael.

account; duties, as a matter of

is

entirely a

money of

being paid in the

fact,

local

currency of the port at a rate of exchange settled on the

opening

of the

Customs House

The exchange
rencies
2.

rates of the

are settled each

The Kuping, or Treasury

it

is
3.

in

in

each port.
tael in foreign cur-

month by the Customs

taxes and dues other than

paid in kind or

at

Haikuan

Tael.

In

this all

authorities.

Government

Customs Revenue, and those

copper cash, are calculated. In theory

uniform throughout the Empire.

The Tsaoping Tad.

Shanghai,

in

This

is

the tael in general use

which foreign exchange

rates are quoted

by the banks.
4.

The Canton

In the
to

which

is

used for weighing bar

Hongkong, Shanghai and Canton.

silver in

have

Tael,

exchange

of

one

tael into

be considered: the weight

another three elements

of the respective

the fineness or touch of the silver; and convention,

old custom''.
of calculation
in

converting

The

taels;

premium

or

complications which result from this form

may be judged
Kuping

from the operations followed

or Treasury taels into Shanghai

taels.

148

The element of weight is first considered. One hundred

Kuping taels (by weight) are equivalent to 101.80 Tsaoping
taels (by weight).

Next, for difference of touch on, say, two shoes, 5.6

is

added, making 107.40.

By Shanghai

convention, an old custom or understanding,

the origin of which

divided

added
is

by

for

0.98,

is

in obscurity, this

lost

which increases

meltage

it

To

to 109.592.

and the value of

fees,

sum

is

now

this 0.008 is

00 Kuping taels

then found to be Shanghai taels 109.60.

At

Tientsin a premium"

is

added instead

of dividing

by

a convention" ratio.
In theory, the Haikuan,

pure

silver,

exchange

Kuping and Canton

though 100 Canton

into

taels

taels are all

pure silver

of

may

111.05 to 111.20 Shanghai taels according to

the quantity of silver sent in to be melted.

The following

shows the approximate exchange

table

value between the more important taels

1

00 Haikuan taels

00 Kuping

taels

100 Haikuan taels

As

an

instance

of

various calculations in

=
^
^

1 1 1

.40

Shanghai

or

taels,

105.215 Tientsin taels.

1

09.60

Shanghai

101.642395

the confusion
taels,

we

taels.

Kuping

taels.

which obtains

take the liberty

to

in the

repro-

duct directly from Mr. Morse's book the following passages

about Variability of Standards", Local Taels" and Peking

Taels".
Variability of Standards.

One town may be taken

Chungking,
of

China.

in the

to typify

many

province of Szechwan,

Here the standard weight

in

the

town

of

the far west

of the tael for silver


transactions

555.6

is

however,

quently,
for,

depending

grains,

and

this

which the scale

transactions in

all

149

not

is

Fre-

specified.

of the scale is provided

modification

some

in

the standard for

is

cases upon

the place

from which

the merchant comes or with which he trades, and in others

upon the goods

which he

in

deals.

merchant coming

from Kweichow, or trading with that place,

but not certainly, use a scale on

which the

a tael

562.7

grains;

weighs

tael

town on the Yangtze,

548.9 grains; a merchant from Kweifu, a

a hundred miles from Chungking,

will probably,

buy and

will

with

sell

and between these two extremes are

Chung-

at least ten topical weights of tael, all current" at

king. In addition to these twelve topical currencies", there

One

are others connected with commodities.

important

products

this are settled

by

from the Tzeliu

grains.

of

Szechwan

is

salt,

a tael of 556.4 grains,

well, in

and dealings
unless

is

is

it

which case the standard

transaction in cotton cloth

most

the

of

salt

557.7

is

settled with

in

a tael

of 555.0 grains, but for cotton yarn the tael is 556.0 grains,

and

for

raw cotton the

tael is 547.7

This seems confusion,

Up

to this point

the

scale,

but

but

we
now comes

we

are not yet at the end.

have dealt only with the weight on

in

the question of the fineness

of the silver with

which payment

three qualities

silver are in

of

grains.

is

made. At Chungking

common

use

fine

silver"

t.OOO fine current throughout the empire, old silver" about

995

fine,

and trade

payment may be
lities.

silver"

with

the

fine;

and

stipulated in any one of these three qua-

Taking the score

nation

between 960 and 970

three

of

current

grades of

tael-weights
silver,

in

combi-

we have

at least

sixty currencies possible in this one town.

This

is

characteristic of the Empire.

The

traveller,

even


a private
China,

be

and a string

which on
in

cashing

with him

home

scale

this,

he

exchange between

Even

sojourn.

he brought

home and

then, however, he

cash

of

in the strange place

work out the

able to

is

his

silver

of

step

first

weight of his string

on the scales of the strange bank

having done

His

to him.

exchanging the

or

draft

known

is

in

steel-yard

few selected cash", the exact weight

to ascertain the

is

place

to

him a small

careful to take with

of a

his

from place

journeying

individual,

will

150

and,

parity

of

the place of his temporary

dependent on the banker

is

matter of the quality of silver; fortunately, the com-

in the

mercial honor of the Chinese bankers stands high, though

it

is

hardly to be expected that they should not profit by

their expert

knowledge.

China you must prove your axioms.

In

tomed

to currencies in

and accurate weight

monly

which the unit

are accus-

of an alloy of a precious metal (com-

gold) of an exact

China the

We

of value is a defined

and known degree

silver currency is

an

of fineness. In

article of barter,

neither the weight nor the quality

is

anywhere

which

of

fixed.

Local Taels.
It

may be

that every commercial place has, apart

said

from the various government

or score of

current;
it

is

so

i.

local
e.

taels,

all

each of them
as

stipulated,

taels, its half-dozen, or

generally
is

recognised

a recognised currency

we have

these various taels there

all

when

seen in the case of the

currencies of Chungking. Usually, however,

among

dozen,

and

is

if

one which

not generally,
is

recognised

as the currency of the place, in which payments would be

made when there

will be commonly

is

no stipulation

stipulated,

and

to the contrary,
into

which

which remittances


are

made from
some

for

is felt

other places

151

for

even

China the necessity

in

limitation on the kaleidoscopic varieties

which

wrould otherwise perplex the minds of even Chinese bankers.

Sometimes, but by no means generally, this recognised local

extend

tael will

influence over the surrounding country

its

within a Umited radius

country banker to live

is
1

but ordinarily the right of even the

is

privileged to adopt

fully recognised,

its

70 well-recognised and

own

and every place

standards, I have notes of

different currencies, gathered mainly

from the Treaty ports and their immediate

vicinity.

Peking Tads.

The

Peking,

capital,

is

one place,

it

may be

said the one

place of importance, in which no one currency has emerged

Being the

as the one local tael.

much

of course

government
ards

of

Market

1.000

evidence as the currency of

in

all

tael is
official

transactions. Besides this there are three stand-

weight

tael

the

Kung-fa

of

555.7

grains,

the

552.4 grains, and the Metropolitan or Two-tael

of

scale of 54

Kuping

capital, the

.7

grains

and 980

and two recognised standards

(The addition of

fine respectively.

of silver,

2 taels in

the hundred, 2 per cent, will bring the Two-tael to the value
of the
of

Market

hence probably the name). Each standard

tael;

weight (except the Kuping)

is

expressed in each of the

two standards

of

Peking seven

taels all equally current.

established

Kung-fa

Each
is

further

subject
it

..complete";

The

foreign banks

few years adopted the

1.000 silver as their currency of account.

of

of these currencies, except the

according as
or

with the result that there are at

have within

there

tael

silver,

is

to

a difference of

..equalised"

thus

Kuping and Kung-fa,

100

0.6

to

or ..empt)^" or

Kung-fa

0.9
,

per cent

.mercantile"

taels are equivalent to

r- 152

Metropolitan taels 102.80

if

if

mercantile, 102.70

equalised, but only 102.00

if

empty, 102.60

if

complete.

THE DOLLAR,
As
is

the tael

not a coin but a weight, and copper coin

is

bulky for ordinary cash transactions

too

ports and also in the provinces,

and other

dollar coin for domestic

exchange value between

tuates considerably,

and

in the treaty

customary to use a

is

it

retail transactions.

local dollars

and local

into this fluctuation

The

taels fluc-

many elements

quite apart from the intrinsic value of either currency enter.

Various dollars are

in circulation in different parts of the

Hongkong and

Empire, some foreign, such as the

dollars, the

Mexican

(which

dollar

the one in

is

Straits

general

use in Shanghai and the neighbourhood) and the old Spanish or Carolus dollar. Various reasons

kind of dollar

to

may

cause a certain

become popular over a large or small

area and to appreciate in value to 30 or 40 per cent above

its intrinsic

value. In

some

Hangchow

of the smaller treaty ports,

such

Wuhu, the Spanish dollar is most

in favour to this day. Though lighter than the Mexican
dollar, it may be in such demand as to fetch $ 1.40 Mex.
At present the Hongkong and Straits dollar is fashionable"
as Ningpo,

in

certain

or

cotton-growing

compared with other coins

But

coin.

would probably be

Thus the

at a

is

dollar

premium

intrinsic value.
if

used in other

at a discount to the local Chinese

actual value of the silver in the dollar coin,

whether minted
provincial mints,

values

of

and

about the same

and the Spanish

botli the British

districts

districts,

in Spain,
is

Mexico, the Straits or one of the

a less important factor in the exchange

between the

different

dollars

themselves and the


local

Local

coin.

premium
ports,

note

to the

which may be

issues,

when compared with

or a discount

add

than the fleeting popular fancy for this or that

taels

particular

153

at

those of other

perplexing chaos of Chinese silver currency.

Chinese dollars have been issued by various provincial mints,

but their great drawback has been that they are at a dis-

count in

provinces but the one in which they are minted.

all

There are more than ten

circulation.

been

The Mexican

of Chinese dollars in

varieties

dollar for the past fifty years has

most generally popular, and

the

widely current than any other coin

it

probably more

is

in China.

SUBSIDIARY COINAGE.
Throughout China subsidiary
and

10

20-cent

and 1-5th

1-20th, 1-1 0th

tael

pieces

(and

silver

known

coins,

as

of the dollar) but

stamped with a

value (the ,,10-cent piece", for instance,

The

is

stamped

candareens), are in

circulation.

bear

varies to an extraordinar)^ degree.

to

the

dollar

times eleven ,,10-cent pieces"

5,

nominally bearing a ratio of

7.2

ratio that these coins

may be

At

obtained for a dollar

while at others ten ,,10-cent coins" cannot be got at ex-

change shops. Popular fancy plays

subsidiary silver coinage also.

At

its

part in connexion with

the present time

Hongkong

5-cent pieces are in general favour for use as buttons.

consequence

is

that

20-cent pieces,
of giving

one

whereas for ten 10-cent

The

pieces, or five

the cash shops will not entertain the idea

dollar,

they will readily accept twenty 5-cent

coins as the equivalent of a dollar in local currency.

Besides
currency,

subsidiary

which

is

silver

coins

there

is

the

copper

really the currency of the people.

kinds are in universal use;

10-cash pieces

(cents),

Two

which


supposed

are

to

contain

154
95

per

cent of copper and are

about the size of a halfpenny; and one-cash pieces, which

coined in large and small

are

sizes,

have a square hole

in

the middle, and contain only 50 per cent of copper. Since

1904

the

coins in such
at
1

mints have been turning out 10-cash

provincial

numbers

an alarming

that they

In 1905-6,

rate.

have depreciated

when

in value

the minting of copper

0-cash coins was begun, the value of a Shanghai tael

1100 to 1200 cash.

It is

now between

was

1700 and 1800 cash.

recent estimate puts the coins in circulation in China

at the following figures:

Foreign dollars

114.000.000

Sub. Silver coins

1.500.000.000

Copper 0-cash coins

1

to the value of: Tls.

Chinese dollars

00.000.000
43.000.000

During recent years provincial mints have been permitted

to issue silver

and copper subsidiary coinage for purposes

of revenue, and

this

accounts for the enormous over-issue,

and consequent depreciation

kong

is

in value of these coins.

Hong-

faced with a very serious problem in this depre-

ciated silver subsidiary coinage.

APPENDIX

B.

Present Condition of Banking

China.

in

BANK-NOTES.
The

foreign banks having branches in China issue notes

for taels

and

dollars, in various multiples, in the local cur-

rency of the places where they have branches. Their note

issue

is,

of course, restricted

Bank-notes

are

also

by

their regulations.

by numerous native banks

issued

and provincial governments, and add

inasmuch

as

recently

until

by considerations

but, as will

be seen

these issues v^ere unrestricted

later,

gulations the Ta-Ching or

the

monopoly

As

the financial chaos,

of adequate reserves for redemption.

accurate estimate of the native note

at,

to

issue

No

can be arrived

under the new Currency Re-

Government Bank

is

to

have

of issuing notes in the future.

a result of the protest of foreign banks and commer-

cial firms

against the unlimited issue of Chinese bank-notes,

regulations were issued

These regulations
degree

by the

Ministr}'' of

were enforced

at Chefoo, Tsinanfu,

in 1909.

greater or less

Changsha, Nanking and Canton;

they were issued, but not enforced at

Chinkiang and Foochow, while

were ignored altogether.

to

Finance

at

Newchwang, Hankow,

other

treaty

ports

they

156

BANKS.
The following

Banks operate

foreign

in

China:

British.

Bank

Chartered

Head

of

India,

Office:

kow, Hongkong, Shanghai,

Hongkong

and

Australia

China,

Ld.

London. Branches; Canton, Foochow, Han-

and

Shanghai

Tientsin.

Banking

Corporation.

Head

Office: Hongkong. Branches: Amoy, Canton, Foochow,

Hankow, Peking, Shanghai (with Sub-Agency at Hong-

kew), Tientsin.

Bank

Mercantile

of

India,

Head

Ld.

Office:

London.

Branches: Hongkong, Shanghai (Agency).

Other NationaHties.
Banque de ITndo-Chine. Head
Canton,

Office:

Paris.

Branches:

Hankow, Hongkong, Peking, Shanghai,

Banque Sino-Belge. Head

Office: Brussels.

Tientsin.

Branches: Shang-

hai, Tientsin.

Deutsch-Asiatische Bank.

Head

Hankow, Hongkong, Peking,

International

Office:

Berlin.

Branches:

Tientsin, Tsinanfu, Tsingtao.

Banking Corporation. Head

Office:

New

York.

Branches: Canton, Hankow, Hongkong, Peking, Shanghai.

Nederlandsche
Society).

Handel-Maatschappij

Head

Office:

(Netherlands Trading

Amsterdam. Branches: Hongkong,

Shanghai.
Russo-Asiatic Bank.

Head

Office: St. Petersburg.

Branches:

Hankow, Harbin, Hongkong, Kashgar,

Chefoo,

Hailar,

Kuldja,

Kuanchengtze, Newchwang, Peking, Shanghai,

Tientsin, Tsitsihar.

Yokohama

Hankow,

Antung,
chun),

Head

Specie Bank.

Office:

Yokohama. Branches

Kuanchengtze

Hongkong,
Mukden,

Liaoyang,

157

Newchwang,

(Chang-

Peking,

Port

Arthur, Tairen (Dalny), Tiehling, Tientsin.

Chinese Banks.

The number

banks

of

China

in

legion, as until recently

is

been no law requiring banks

there has

to

be organized

and incorporated. Banking business could be established

with

almost

as

formality

little

as

any other

capital of the majority of these institutions

many

amount

instances will not

is

trade.

small,

and

are

many banks

attaching

in

to

have closed

some standing

of

in

more than a few hunderd

to

pounds. In the recent financial stringency at Canton

banks out of 150 are said

The

(apart

fifty

There

their doors.

from the reputation

general to the Shansi Guild of Banks, that

province being the traditional cradle of banking in China),

but

they

suffer

most part from a weakness for

the

for

uncontrolled issues of banknotes and often of paper

money

of the smallest dimensions.

The two chief Chinese banking institutions are

The Ta-Ching Government Bank, now recognized as the
official Bank of China. Evolved from the Hupu Bank,
1 908.
Head Office, Peking. Capital, Tls. 1 0.000.000.
:

(&

1.250.000.-

{&

approx.);

paid-up, Tls. 7.000.000.

.000.000. approx.), half subscribed by the Chi-

nese Government, half by Chinese shareholders. (The

articles state,

Shares shall not be sold to foreigners

nor be transferable
is

estimated

300.000.

at

but

the

Hupu Bank was

mately

Tls.

to them.")

between
note

Tls.

The note
200.000.

circulation

circulation

and

Tls.

of the former

understood to amount to approxi-

15.000.000..

Bank

Imperial

of China.

158

Head

Managing

Office, Shanghai.

Directors, Chinese, but foreign

managers

at

Shanghai

and Peking.
In the lower Yangtze Valley the following native banks
are prominent:

Ningpo Commercial Bank. Head

Office,

Shanghai. Capital,

150.000. approx.), half paid-up.

1.500.000.

{
$
Chun Bank. Head Office, Shanghai. Capital, ,^

Svin

00.000.

approx.), half paid-up.

The

.000.000.

note issue

is

estimated at equivalent to the paid-up capital.

Shing

Nih Chartered Bank. Head

Capital,

Has

Imperial Bank.

Capital,

Hangchow.

1.000.000. { 100.000. approx.), one-

fourth paid-up.

Yue Soo

Office,

a large note issue.

Head

$ 200.000.

Office,

Soochow

20.000.

(Kiangsu).

approx.).

This

Bank is said to have been started by a Governor of

Soochow with money loaned by him, and the large
note issue was guaranteed by him.

Kiangnan

Yu Ning

200.000.

Bank. Head
{M

20.000.

Office,

Nanking. Capital,

approx.).

Said to have

been started by a former Viceroy of Nanking, and

the large note issue

is

guaranteed by the Nanking

Provincial Government.

In

Bank
Chiao

Canton two banks besides the Ta-Ching Government

issue notes:

Tung

Shan Hou Chu

(note issue,

(note issue,

100.000.).

1.500.000.

),

APPENDIX

C.

Extract from a letter written by

President

the

of

Bank,

Java

Count

Weltevreden-Batavia,

at

Sauveur,

in

Dr. G. Vissering,

French

the

to

Despreaux

Consul

de

Saint

answer to some inquiries about the mone-

tary reforms, which had recently taken place in

some

parts of the Netherlands Indian Archipelago.

Batavia,

DiRECTlE

19

le

septembre 1910.

DER

Javasche Bank

Comte Despremix de

Monsieii.r le

Saint Sauvcnr, Consul de France,

Weltevreden.
Monsieur,
C'est avec le plus

vif

interet

d'un article de la main de

agrege d'^conomie politique a

blic
vol.

dans
II

la

No.

15-20 juin

de

j'ai

I'universite

Revue economique
3

que

pris connaissance

M. Bertrand Nogaro, professeur

monetaire dans I'lndo-Chine

de Montpellier, pu-

Internationale,
'09

intitule:

6ieme annee,

La

franipaise".

L'auteur erudit a expose d'une maniere tout a

toutes les difficultes

dans vos colonies

reforme

fait claire

qui se presenteront sans doute aussi

fran(;aises

par rapport a la circulation

d'une monnaie d'argent, surtout dans un pays, qui a tant

de relations intimes avec

la

gigantesque Chine.

le

pays de I'argent par excellence,

160

y a maintenant quelques annees nous avons eu dans

II

nos

memes

colonies les

probleme a ete resolu a

comme

a present ce

la parfaite satisfaction

non seulement

difficultes, et

du Gouvernement, mais encore de

de

liberte

la

dernier
cette

communiquer, comme

vous

encore

entretien,

me

question,

quelques

flattant

prends

la population, je

par

details

que cela

suite

notre

rapport

vous interessera

aussi

en vue de votre propre colonie.

La

resolution

de cette question dans nos colonies a ete

quand on

surtout interessante,

la

compare a

maniere

la

dont un probleme presqu'analogue a ete resolu dans les

colonies anglaises

voisines des

Straits Settlements et pres-

meme temps d'une toute autre maniere en

Q'il me soit permis de vous exposer d'abord

Mexique.

qu'en

traits le

systeme monetaire de notre

Pendant

a grands

patrie.

annees 1872-1875 la HoUande a hesite a

les

passer de I'etalon d'argent a I'etalon d'or et ce ne fut que

par la

loi

du

adoptee

fut

1875 que la piece d'or de

6 juin

comme

frapper cette piece

En meme temps

d'or.

de pieces d'argent

maintenu

meme

pour

Les

lois

faire

suspendue

monetaires ulterieures ont

Gouvernement

le

florins

frappe libre

la

fut interdite, apres avoir ete

pendant quelque temps.

10

avec liberte absolue de

etalon,

cette

defense ex-

presse de faire frapper des pieces d'argent autrement que

pour remplacer des pieces usees, retirees de

fondues

et

dans

la

florins

pour en

circulation

etaient

limitation

faire

interieure les

maintenues

de quantite.

bien des rapports avec

Nos
les

de nouvelles

pieces.

pieces de

comme monnaies

2Y2.

Pourtant
et

legales

1/2

sans

Notre systeme monetaire a done

le

systeme monetaire fran9ais.

colonies avaient deja depuis la

memes monnaies

la circulation

loi

du

ler

legales que la mere-patrie

mai 1854
et

par

la


du 28 mars 1877

loi

comme

proclamee

Dans nos
en or:

161

la piece d'or

etalon pour

de dix

florins fut

Indes

les

egalement

neerlandaises.

colonies ont done cours a I'heure actuelle:

piece de 10 florins hollandaise,

la

en argent: les pieces hoUandaises de 2M,

comme monnaies

toutes ces pieces

et Vi florins;

legales.

Par centre nos colonies ont leur propres monnaies

di-

visionnaires qui en denomination correspondent a celles de

mere-patrie,

la

(de
ct.

cents,

5
et

ct.

c.-a-d.

de 25 cents

et /4

d'appoint sont en bronze.

propose de

Hollande

Un

faire frapper des pieces

Done en resume:

que

pendant

les

la

les petites

mon-

nouveau projet de

de

pieces d'or

les

memes dans

d'argent sont les

colonies,

10 cents en argent,

en cuivre, mais qui sont cependant d'une

ct.

frappe diflerente, pendant qu'en

naies

et

de nom, mais qu'on ne trouve guere), de 2J^

et

nickel.

les grosses pieces

mere-patrie

monnaies

en

cents

loi

dans

et

divisionnaires

les

sont

differentes.

L'importation

I'exportation

et

illimitees

des pieces d'or

de 10

florins et des grosses pieces d'argent entre la

patrie

et

les

colonies ont ete toujours admises.

de monnaies legales de

la

La

reserve

mere-patrie pourvoit done

aux besoins des Indes neerlandaises, pendant que

mere-

aussi

I'argent

peut etre frappe seulement a la Monnaie d'Utrecht.

L'hesitation a passer a I'etalon d'or avant la promulgation

de la

loi

pu trop

du

6 juin 1875 a

profiter

de

la

dans un temps ou

commence,
duisait

et

que

eu pour

effet

que

le

public a

frappe libre de grosses pieces d'argent

la

depreciation

la libre

done un benefice

de I'argent avait deja

frappe de pieces d'argent pro-

net. C'est

reserve d'argent fut devenue en

par cela qu'en Hollande

1872-1875

et a ete

la

pen-

dant longtemps beaucoup trop grande pour les besoins du


pays, de sorte que plus

tard

Gouvernement

le

meme

fut

de demonetiser una partie en cas de besoin

autorise

un danger que

aurait

162

s'il

chasse du pays par une

fut

I'or

abondance trop grande de I'argent deprecie; heureusement

Gouvernement ne

le

de

jamais trouve oblige de se servir

s'est

qui aurait inflige une perte conside-

cette autorisation,

rable a la nation.

Bien que depuis 1877

piece d'or de

la

10 florins eut

cours aussi dans nos colonies, elle n'y est jamais devenue
populaire

en outre

de nos colonies ont toujours

les habitants

manifeste une preference prononcee pour I'argent, non seu-

lement dans

les

20

mais encore pour

la circulation,

faire

Le developpement enorme de nos

nomies.

des eco-

colonies dans

dernieres annees a depuis absorbe peu a peu cette

abondance d'argent de

grande que

fois plus

sequent

Banque neerlandaise

la reserve d'argent,

rapport entre

le

mere-patrie, de sorte qu'a pre-

la

sent la reserve d'or de la

I'or

et

metallique a beaucoup ameliore.

I'argent

et

de 47?

est

que par con-

de son encaisse

J'ai I'intention

de revenir

plus loin sur ce sujet.

Lorsque,
sition

y a maintenant 4 ans, je re^us

il

me

de

faire

nommer

President de la Banque de

Java, (j'etais en ce temps-la Directeur de la

sterdam)

Banque

Gouvernement hollandais me confia en

le

propo-

la

Ammeme

d'

temps en

quelque sorte

circulation

monetaire dans nos colonies et surtout d'exami-

s'il

les

differents

dollars argent,

jours en grand
lonies.

speciale

d'etudier la

Afin

que Ton trouvait encore tou-

nombre dans quelques contrees de nos

de pouvoir inspecter

propres yeux, je

au

mission

aurait interet a faire disparaitre de la circulation

ner

la

me

suis resolu

mois de septembre 1906, a

de
la

situation

la

me

par

co-

mes

rendre en personne,

cote

orientale

de

I'lle

163

de Sumatra, pendant quel voyage

sens

Apres

contree

vaste

cette

sous

enquete locale

cette

la

tous

du Resident.

direction

Resident

le

en

parcouru

j'ai

et la Direction

de

Banque, nous etions pleinement convaincus de I'urgence

la

de

disparaitre les

faire

de

dollars

la circulation et

de

les

remplacer par notre monnaie hollandaise.

Dans

les

derniers mois de 1906

j'ai

envoye la-dessus un

comme

rapport au Gouvernement, rapport qui a ete ajoute

supplement au Rapport annuel de I'exercice 1906-1907 de

la

Banque de

Java.

avaient cours,

En

ce temps nos monnaies hollandaises

est vrai,

11

dans ces contrees, mais y etaient

assez rares, et dans les cas ou

en monnaie hollandaise,

on

faisait

de

matra

de banque,

revanche
et

dans

grande

en

pour payer des impots,

etc.,

venir le plus souvent I'argent necessaire en forme

billets

En

p.

des payements

fallait faire

il

e.

la

la

soit

de Singapore,

circulation

soit

de Java,

de Su-

sur la cote orientale

Province occidentale de Borneo consistait

partie

de toutes especes.
frappe depuis 1903,

en

dollars

J'enumere
le British

en

et

comme

dollar-divisionnaire
tels le Straits-dollar

trade dollar de 1895, le

Hong-

kong-dollar, les dollars mexicains, anciens et nouveaux, les

vieux

yens japonnais,

espagnols;

meme

les

les

dollars

monnaies de

philippins,

I'lle

les

piastres

Maurice, de Serawak,

de Broenei, de Kwantung se trouvaient dans la circulation.

En

outre les valeurs mutuelles de ces dollars etaient diffe-

rentes, cequi donnait lieu a

un continuel arbitrage

interieur,

generalement au profit de quelques changeurs ruses, mais

au detriment de la population moins

Quelques ameliorations eurent

instruite.

lieu lorsque vers la fin

de

Janvier 1906 la valeur du Straits-dollar 1903 fut definitive-

ment

fixee

sur

2s.

4d.

(2/4).

Alors dans

les

contrees les

plus civilisees sur la cote orientale de Sumatra et dans les

164

plus grandes villes situees sur la cote occidentale de Borneo

on adopta en general volontairement ce

1903

Straits- dollar

a valeur fixee. Pourtant a cote de ces Straits-dollars fixes

nommes

deslors les autres dollars deja

ci-dessus continuaient

comme

a circuler dans ces deux grands territoires

argent, c.-a.-d. avec une

prix

toujours

surtout dans I'interieur

la

monetaire et

circulation

dans

comme

de salaires

loyers,

etc.,

les

dans

relations financieres
les contrats, le

coolies

montant des

dollars, le
florins,

etait

ne savait

en

de chemin de

pas,

dans quelle sorte de dollars

Nous avons commence

chinois,

se

en

les

paye-

etre effectues.
la

reforme monetaire sur

occidentale de Borneo par Pontianak

et cela

cote

fer,

reduit en dollars, etc. etc. et bien souvent on

meme

ments devraient

tion,

y avait

comptaient en

dollars, les hoteliers

billets

il

meme aux

de dollars; beaucoup de payements

etaient faits

paye-

naturellement au detriment

de bien des gens. Car dans bien des contrats

question

trouvait

du pays une grande confusion dans

des habitants entre eux,

ment de

valeur inconstante qui suivait le

du metal argent. Done on

variant

dollars

comme

la cote

centre d'opera-

sur les instances des negociants hoUandais et

puisque I'incertitude sur la valeur de la monnaie

faisait sentir

une entrave importante dans

le

commerce.

Cette reforme monetaire fut preparee avec la plus grande

precaution et eut des I'abord un parfait succes.

s'est

Comme

accomplie en quelques mois, non seulement

elle

les dollars

etrangers etaient chasses pour tout de bon de la circulation,

mais encore on prenait des mesures rigoureuses pour

infli-

ger une peine a tous ceux qui avaient des dollars en possession,

afin

clandestine.

d'empecher autant que possible Timportation

La

beaucoup dans

circulation monetaire s'est ensuite amelioree

cette partie

de Borneo. Les payements mu-


avec

tuels

165

avec la Chine

les Straits,

avec

et

de payer a laquelle
sont bientot

faits,

importante,

encore

pays

Chinois et les autres orientaux se

les

et puis

en

les autres

cheques, maniere

se font maintenant en majeure partie en

pour une partie relativement peu

papier

monnaie des

Straits,

dont

I'importation n'etait pas interdite, et pour le reste en billets

de

la

Banque de Java, dont

I'importation et I'exportation

etaient naturellement absolument libres.

sur

Si,

affaire

pour

orientale

occidentale de Borneo

cote

la

la plupart a des

nous avions eu

negociants chinois, sur la cote

de Sumatra se presentait une autre question im-

portante. Les ouvriers, dont les vastes plantations de tabac

ont besoin,
soit

sont

en grand nombre des Chinois, introduits

des Straits, soit directement de la Chine.

meme

societes ont

affrete leurs propres

Les grandes

bateaux

et

nomme

en Chine leurs propres agents afin de recruter regulierement

des ouvriers chinois sous des contrats, sous la surveillance
des inspecteurs du Gouvernement.
Jusqu'a ce

moment

les

coolies chinois etaient payes en

dollars argent, qui avaient cours dans

en

de sorte

Chine,

que leur

Straits

les

salaire etait

et

paye pour

aussi
ainsi

dire dans leur propre monnaie.

Tout a coup un grand changement dans

fut

amene

argent eut

lieu,

vernement des
le

cet etat

de choses

lorsqu'une nouvelle hausse dans le prix du metal

et lorsque

presqu'en

meme temps

le

Gou-

Straits Settlements le 29 Janvier 1906, fixa

Straits-dollar

a une valeur definitive de 2/4, une valeur

assez elevee en comparaison des prix

du metal argent des

dernieres annees.

La

plupart

des entreprises sur la cote orientale de Su-

matra, a cause de leurs nombreuses relations avec les Straits,

se croyaient obligees de suivre

bon gre mal gre

la

reforme

166

monetaire dans les Straits et

courante ce Straits-doUar a valeur fixee,

temps

les

de beaucoup d'ouvriers indigenes furent

salaires

a une valeur fixe; cependant les

portes dorenavant

aussi

comme monnaie
de sorte qu'en meme

d'adopter

autres dollars non fixes n'etaient pas retires de la circula-

de circuler a

tion et continuaient

parmi

I'interieur

les tribus

indigenes.

Un

point de la plus haute importance pour le Gouver-

nement des
cours

1903

Straits Settlements etait cette question: a

fixer

faut-il

prix de I'argent

le

jamais connu:

La

du

parite

21

11/16

avait
d.

argent

dollar

atteint

pour
en

le

le

I'unite

plus

la parite

du

dollar

fl.

0.93.

fl.

1,25,

fut

meme

1,30,

fl,

et

Puis de Janvier

florin,

peu avant

le

pousse en quelques endroits a

le

ayant
(1

fl.

puisque

de

1,16,

1,45.

fl.

Straits

1903

= 60

cents).

de cette hausse soudaine du prix du dollar

le

Straits- dollar

1903

diatement surevalue. C'est pourquoi

solut

1,43.

le Straits-dollar

Gouvernement parait avoir recule devant

2/-,

et etait
fl.

en monnaie hollandaise une valeur ronde de

sh.

cause

1,15,

Gouvernement des

1,20

fl.

fixage le prix du dollar

eu d'abord I'intention de fixer

va sans

de cette fluctuation

puis jusqu' a

aurait

fl.

le

exprimee en monnaie hollandaise

D'apres les renseignements

2/-,

etait

au mois de Janvier 1906

et

avait egalement subi I'influence

monteejusqu'au delad'un

point

de I'ounce anglais.

prix de I'argent etait deja monte jusqu'a 30V4.

que

bas

prix de I'argent etait susceptible

a de grandes fluctuations

dire

quel

mois de Janvier

monnaie hollandaise

par consequent venu a peu pres a

1903 a Janvier 1906

Au

Straits-dollar?

le

le fixer

2/4,

Les consequences de

la

fixation

aurait alors ete

ce

cette

mesure

sur

imme-

Gouvernement

valeur ronde hoUandaise de

le

fl.

re1,40.

allaient bien loin. Je

plus

trouverai

167

encore I'occasion

bais

de relever

en

cela

quelqes mots.

En

adoptant volontairement cette reforme monetaire des

de Sumatra,

Straits sur la cote orientale

res

avaient pousse

c.-a.-d.

le

dans

temps,

derniers

les

mois de Janvier 1903. Maintenant

au

0,93

fl. 1

,40

une difference considerable avec I'equivalence de

pour

resultant
dollar,

inconnue

a une equivalence en monnaie hoUandaise de

le dollar,
fl.

salaires des coolies chinois et indi-

les

genes a une hauteur

grandes cultu-

les

du prix has

cultures

les

ne mit plus d'obstacle a

la

et

profit,

reforme monetaire que

Gouvernement neerlandais se proposait

Gouvernement a done su

le

inconstant du

s'assurer de

la

Ce

d'accomplir.

collaboration des

habitants de la cote orientale de Sumatra et des planteurs

pour
fit

retirer

de

au pro-

la circulation les dollars etrangers

de sa propre monnaie.

Tout de

meme

restait toujours

la

question du salaire des ouvriers chinois

une des plus

delicates.

Des pessimistes

pre-

tendaient que les ouvriers chinois ne se contenteraient jamais

d'une monnaie qui leur etait parfaitement inconnue et qui

n'aurait cours

Chine.

revoke,

On
si

ni

dans

arrivait
le

les

meme

Straits,

ni

dans leur

a predire meurtres,

Gouvernement

patrie,

la

assassinats,

se hasardait a mettre ses pro-

pres monnaies a la place des dollars.

Heureusement ces pessimistes ont eu

la

reforme

accomplie d'une maniere tellement

facile et

monetaire

s'est

insensible,

que non seulement

de mecontentement, mais
forme, ni apres, aucune

aucune resistance ne

ni

il

n'y a

auquel

pas eu un

moment

pendant I'execution de

dissonance ne

s'est

tort:

s'est

fait

la re-

entendre,

manifestee, Aussi j'ose dire que

Gouvernement lui-meme ne

ce succes

parfait,

s'attendait

pas a un degre pareil, est du a la preparation

le

soigneuse de cette reforme monetaire, et

a I'execution

et

168

a une collaboration serieuse des planteurs.

Maintes precautions avaient ete prises pour introduire

cette

monnaie hoUandaise encore peu connue parmi

tion

non-europeenne

comparaison avec

d'en

et

connaitre la valeur en

faire

monnaies etrangeres en

les

la popula-

circulation.

cet effet on a organise d'abord des reunions avec toutes

de

les parties

la

population dans les centres de commerce

de ce pays; on expliquait d'abord autant que possible

reforme, non seulement aux

aux

ba^sses

nois

et

de la population, aussi bien aux Chi-

classes

aux

Cingalais, qu'aux Arabes; et chaque categoric

separement avait I'occasion de poser

presenter

des

objections.

Ainsi

parties de la population, de sorte

du Gouvernement

des questions et de

on a consulte toutes

que

les

but

les projets et le

etaient parfaitement clairs a tous les rangs,

avant de commencer I'execution du

demande

qu'on avait

la

mais surtout

elevees,

classes

va sans dire

projet. II

aussi I'opinion des Europeens, c'est-a-

dire I'opinion de toutes les categories, planteurs, industriels,

militaires,

fonctionnaires,

I'occasion

de mettre leurs

negociants

Une

interets en relief.

cord avec toutes ces categories de la population,

encore a regler prudemment

la

tremement

uniformement
fixe.

fut

Pour

La

utiles.

comme

les contrats

done reduit a

fl.

fl.

1,40

change du

de

de

monnaie

dollars.

p. e.

Tous

par mois

les

hollandaise.

fl.

4. au

magasins ou

les

Straits-dollar

le Straits-dollar

done expliquer maintenant aux coolies qu'a

gagneraient

des

rond fut adoptee

main-d'oeuvre

1,40 en

restait

il

nous ont ete ex-

cours
la

fois d'ac-

fois la collaboration

cultures, qui

valeur de

eu

question avec les coolies.

Nous voulons memorer encore une

administrations des grandes

ont

tous

et

etc.

lieu

coolies

fallait

longue

la

de

II

ils

Straits-

faisaient

leurs

169

emplettes furent instruits de coter toutes leurs marchandises

monnaie hollandaise,

en
a

1,40, et

fl.

toujours

Straits-dollar

le

en cas de necessite

compte

marchands adoptaient

les

une autre unite de marchandises. Ainsi cette question, menee a bonne

aucune

duisait

le cent

rait

des Europeens,

sous la ditection

fin

Desormais

difficulte.

hoUandais au

lieu

monetaire

I'unite

du cent des

ne prose-

Straits, tandisqu'on

donnait pour le cent

hoUandais une quantite de marchan-

dises environ 100/140

de

que Ton donnait au-

la quantite,

pour un cent des

trefois

Les marchandises de

Straits.

moindre valeur economique, comme

les

oeufs,

le

la
le

riz,

tabac, le betel, I'opium act. donnaient naturellement la plus

grande

difficulte;

proportionnee

on aurait cree

les

Ton avait transforme d'une

si

prix de ces objets de premiere necessite,

la cause

Apres avoir prepare

semaines

premieres

et

marchands a coter

payer aux

Straits-dollars en leur

ce

premiere d'un mecontentement.

les

monnaie hollandaise, on

en

dises

que par consequent dans

un

les boutiques

de

fl.

,40.

1,40

les

marchan-

ils

pouvaient

Les coolies

s'aper-

recevaient les marchandises

proportion qu'autrefois pour

Apres avoir continue quelque temps a payer

serait

1,40.

ou

fl.

qu'ils

la

de cette maniere, on communiquait aux coolies

garderaient leurs

14.

en

meme

qu'il

fl.

salaire

1,40 dans

les salaires

fl.

les

immediatement
fl.

dollar.

qu'ils

pendant

leur

monnaie hollandaise,

faire leurs emplettes a raison

cotees a

coolies

marchan-

une valeur hollandaise de

dises etaient deja cotees en

cevaient

continuait

les

communiquant en meme temps que

representait

dollar

facjon dis-

de

lieu

de 10 dollars

s'apercevaient

ils

Straits,

le dollar

mais

compte

recevaient maintenant

egalement

jours acheter les objets de premiere

10.

paye en monnaie hollandaise,

Au
et

salaires

qu'ils

pouvaient tou-

necessite

des

prix


6gaux a ceux

170

Peu a peu on communiquait aux

d'autrefois.

coolies qu'ils ne recevraient plus

pour chaque Straits-dollar

de

1,40

fl.

aucune

Ainsi, sans

d'autrefois.

difficulte les coolies se sont faits

mais

dollars

a cette reforme monetaire

en quelques mois seulement.

II

me

reste encore a vous informer de la maniere, dont

nous avons expulse

le

aout

1906

que

les differents dollars argent, autres

En Borneo nous avons commence

Straits-dollar.

d'acheter

un

certain

prix,

pour une serie de quelques jours, toutes

publie

deja en

d'avance

les pieces

de

dif-

ferentes categories, que les indigenes et les Chinois voulaient

nous ceder; I'achat fut

pendant que

pour compte du Gouvernement,

fait

Banque de Java

la

meme

se couvrait pour le

compte en vendant journellement un

certain

montant par

depeche a Hongkong, ou nous pouvions trouver un debouche

pour presque toutes ces

Le Gouvernement entretemps

sortes.

avait defendu I'importation de ces monnaies, et la population

fut

prevenue qu'apres quelques mois non seulement

les

paye-

ments en ces pieces seraient defendus, sous peine d'amende

et

de prison, mais

meme

possession sous peine de con-

la

fiscation entiere. Puis la population fut avisee

que

le

prix

d'achat serait plus tard abaisse. Les habitants se sont montres

tres inclines a

dollars

echanger

les dollars,

de sorte que quant aux

argent la reforme fut accomplie aussi dans I'espace

de quelques mois seulement.

II

pour I'achat des dollars dans

y avait encore une

I'interieur

pouvait pas recevoir la derniere cote

fonctionnaires

en

se

du pays, ou Ton ne

du metal par

du Gouvernement ont resolu

rendant

personellement

jusqu'a

les

moindre qu'a

la

fil;

les

cette difficulte

des

distances de

plusieurs semaines en montant les fleuves enormes

en achetant

difficulte

du Borneo,

monnaies a des prix de quelques cents

cote,

afin

d'avoir

une marge centre

les

du

risques d'une baisse

metal

de

fl.

dans

ce

1,38 a

fl.

n'a pas subi

prix.

meme

nous avons ete a

171

Pour

cette reforme en

de profiter des prix

temps-la,

pendant que

le

du

Gouvernement

de pertes de change.

Ouand nous commen^ames a Sumatra

en fevrier

tres eleves

population a regu des prix

et la

1,35 la piece,

Borneo

avril

I'annee suivante,

dans la province

1907,

de Bengkalis-

Siak, le prix de I'argent avait deja baisse considerablement,

de sorte que nous ne pouvions commencer

maniere que par des achats a

nous etions
le

1,25;

fl.

vait

meme

1,30

fl.

obliges d'aller encore

meme

1,29, et bientot

plus loin jusqu'a

hasard nous a done aide, la population eprou-

qu'un ajournement de se debarrasser des dollars

devenait de plus en plus desavantageux.

stances la reforme fut aussi tres vite
regions, encore

nement,

une

L'expulsion

de

ritoire

fois

Deli,

ces circon-

dans

ces

expedies tout de suite et

meme moment.

des monnaies etrangeres dans le grand ter-

Assahan, Langkat,

venait d'etre remise encore pour

la

Dans

accomplie

lui

sans aucune perte pour le Gouver-

les dollars achetes etant

vendus presqu'au

que

fl.

de la

les

un

pays des Bataks,

certain

etc.

temps jusqu'a ce

mere-patrie serait en etat de nous livrer les nouvelles

pieces,

monnayces a

la

monnaie d'Utrecht, dont nous avions

specialement besoin pour

ces

pays;

ces

nouvelles

pieces

ont ete frappees exclusivement d'autres grosses pieces d'argent

de Hollande, dont

la

quantite etait restee encore trop con-

siderable pour les besoins de notre nation; la reforme

netaire

aux Indes nous a done apporte

le

grand

profit,

moque

nous pouvions trouver un bon debouche pour une partie

de notre reserve en argent, encore toujours trop grande;

ces

envois d'argent aux Indes etant remplaces par de

I'or

par voie d'arbitrage international, la reforme a aussi colla-

bore
qui

172

am61iorer la position monetaire de la mere-patrie,

de I'argent

donnait

de

recevait

et

responsabilite de la mere-patrie pour

de

tations

lande, resta naturellement

intacte,

de

Hol-

que Taccrois-

sorte

HoUande

la

sement

de

comme

garantie pour I'argent en circulation aux Indes.

Pendant ce
toujours

d'un

d'argent, valait
le risque d'un

quand

de

les Straits-dollars

meme
aussi

pendant que

fl.

on

1908

fevrier

departements

les

le

meme

finesse

Gouvernement courut

prix,

nous avons continue

1,20 jusqu'a

de I'echange des

que pour

du

fixe

dollar

la

fin

de mai

dollars, aussi

les dollars argent,

1908,

bien pour

fut

declaree

apres cette date fatale les payements en dollars, et

la possession

dans ces

de ces pieces, furent strictement interdits

terres, sous les

memes

peines qu'en Borneo,

pendant que I'importation avait ete defendue des

mencement de
gens

reculait

le

Bien que

nouveau recul de

le prix

dans

et

poids et presque de la
1,40.

fl.

la periode

terminee

1,20,

fl.

meme

Deli

egalement

argent ne pouvait pas etre paye

dollar

le

plus haut que de

de payer

sert

du metal argent

commencement de

I'expulsion

environnants,

Straits

en

d'or

delai inevitable le prix

lorsqu'au

et

commenc^a

reserve

la

la

augmen-

ces

de monnaies d'argent de

circulation

la

Cependant

For.

toutes

I'echange. Pourtant

conservatifs

croyaient

qui

il

avait

pouvoir

le

com-

toujours des

d'une

profiter

nouvelle hausse de I'argent et qui cachaient leurs dollars

en les enterrant; puisque

attendre, un

la

hausse se

faisait

encore toujours

grand nombre d'entre eux se voyaient obliges de

realiser plus tard les dollars caches, naturellement a des prix

tres inferieurs a

jusqu'a

fl.

ceux de 1906,

meme

a des prix de

fl.

1.

0.70 en certains cas, pendant que quelques-uns de

ces retardataires furent en outre encore punis de leur desobeissance.

Heureusement

le

Gouvernement pouvait agir

tres

173

conciliamment, les malfaiteurs faisant exception et devant

comme exemple pour

etre punis seulement

En

resume, I'expulsion des dollars argent,

les yens, etc.

comme un

peut etre consideree egalement

etc.

les autres.

succes com-

apres le recul toujours de plus en plus serieux

plet, surtout

du prix du metal argent, dans

les

annees suivantes.

Nous

avons ete juste a temps avec ces reformes.

Une

encore a I'egard

troisieme difficulte se presentait

d'une quantite de mauvaise monnaie, surtout de cuivre de

de Serawak,

Broenei,
trop

librement

valeur,

les petits potentats avaient

pieces de presqu'aucune

des

eux-memes de reprendre.

etait

oii

il

fallait

menager un peu

la

les

population, qui

accepte ces pieces en pleine confiance, parceque le

avait

Gouvernement
cas

le

n'en avait jamais defendu la circulation.

Gouvernement

montre

s'est

exproprier les porteurs de ces pieces a

la

II

de toujours refuser ces pieces surtout dans

impossible

ces

dont

etc.

frapper

refusaient

qu'ils

endroits

fait

bonne monnaie parceque dans

etaient

politiques

Une

change.

Cequi

le

etait

que pour

cette matiere les interets

importants qu'une petite perte de

plus

fondue

naturellement

Cependant

meme prix

certaine quantite de ces mauvaises monnaies

irrealisables a ete

cuivre,

Dans

assez facile pour

dommage

et

vendue plus tard comme metal

une

perte

total n'a

relativement

grande.

pas ete considerable.

surtout curieux, c'est qu'il

n'}'

avait presque

pas de fausses monnaies. La raison est pourtant assez simple.

Puisque les dollars argent suivent toujours

m6tal,
et

les

il

n'y

le prix

du

a pas interet a les fausser en metal argent;

orientaux en general

ont

la

reputation

trop bons connaisseurs de fausse monnaie,

ceptent pas les imitations en

plomb

etc.

commencent generalement seulement apres

d'etre

pourqu'ils

Les
le

de

n'ac-

falsifications

fixage a une

174

valeur superieure a la valeur intrinseque, ce dont les Straitsdollars

de 1908 ont donne nouvelle preuve.

encore une autre question a regler,

II restait

c.-a.-d. le

rap-

port des monnaies hoUandaises avec I'etranger, specialement

avec

les Straits et la Chine, puisqu'il fallait faire

aux

coolies,

qu'une

comprendre

de retour dans leur

fois

patrie,

ils

obtiendraient pour leurs economies en monnaie hollandaise une

somme

Dans

equivalente en dollars de leur pays.

nous avons beaucoup profite de

tion encore

des grandes entreprises.

bureau

le

avait deja etabli a

Medan un

norame Bureau d'Immigration", pour rim-

central,

migration et

On

cette ques-

la collaboration

repatriement des ouvriers chinois. Maintenant

ce bureau se chargeait aussi d'expedier k la patrie des ouvriers

I'argent

economise en monnaie ayant cours

ouvriers

pouvaient

leurs economies

session

et

les

la-bas.

Les

done changer maintenant a ce bureau

(c.-a.-d.

I'argent qu'ils avaient deja en

sommes que

pos-

les directions des exploitations

leur devaient encore et qu'elles avaient note sur leur liste de

et ils avaient le

salaire),

choix de les recevoir en cheques en

dollars argent au cours actuel de traites a vue, payables a

Hongkong, a

Amoy ou a Swatovsr, ou bien en traites en Straits-

Le bureau

currency.

avait

nomme ses propres agents dans les

ports chinois ci-nommes, ou sous la surveillance des inspecteurs aurait lieu le paiement des cheques en dollars argent

jusqu'au

montant indique dans

n'avaient

subir

ment convaincus du
ils

la

les
fait,

ouvriers chinois etaient pleine-

qu'une fois

de retour dans

recevraient leurs economies integrales en

naie de leurs pays.

operaient

cheque, de sorte qu'ils

aucune perte de change a leur endroit

de destination. Bientot

patrie,

le

Deli,

mon-

Quelques-uns des plus riches Chinois

deja dans la

Banque de

la

meme

direction.

lis

avaient fonde

qui pour les ouvriers a journ^e (les

coolies libres) faisait ce

pour
de

chinoises,

chinois,

175

que

le

Bureau d'lmmigration

ouvriers qui avaient signe un contrat

les

Banque de Deli

contrat). Cette

villes

formant en

meme

temps

coolies

egalement sur ces

tirait

de I'ascendant que

a cause

et

(les

faisait

la direction

les

chefs

de cette Banque,

avaient sur leurs compatriotes, on consentait sans difficulte

a

accepter

ces

cheques de

peu de temps ces ouvriers

du monde,

se sont faits a

des plus modernes,

beau succes de

On

chose assez
instruits,

gens des moins

civilises

un instrument d'echange financier

En

cheque sur I'etranger.

le

moyen

tres simple

effet

de signaler

un

I'identite

Cheque ou Money

la traite (intitule

order),

a I'egard de personnes tellement peu

difficile

qu'ils

illettres,

Ainsi en

Deli.

la civilisation.

a trouve un

du porteur de

Banque de

la

ne savent

cheque sont mentionnes:

le

meme pas ecrire;

nom et la tribu de

au

dos

du

I'ayant-droit,

son age approximatif, sa longueur, et puis les signes spe-

de signalement,

ciaux

tous ces gens portent

cheque a

I'endroit

comme
plus

les

ou

cicatrices,

moins.

que presque

Ce payement par

de leur destination a encore ce grand

avantage, que les coolies ne peuvent pas perdre leur argent

en route,

dans

soit

I'interet

par vol ou par le jeu a bord;

des

grandes

cultures

qui

c'est

aussi

organisent pour

elles-memes I'immigration des coolies, de prendre soin que

ces gens rentrent dans leur famille avec de belles economies,

ce

qui

est

nouveaux

la

meilleure reclame pour recruter toujours de

coolies, qui a leur tour seront prets a courir les

dangers d'un sejour a I'etranger.

Non seulement pour

les

ouvriers

pour les negociants orientaux

qu'ils

plus

ne perdraient

comme

rien,

il

chinois,

fallait

maintenant

creer
qu'ils

mais encore
la

certitude

ne pouvaient

autrefois payer les marchandises, qu'ils avaient

4$

a
O
UJ

to

^4

o
3C

^6
OT

o
c
CD
u
M
3
o

UJ

f^

CD

ft bn

biO

c
o

CQ

<
W
Q
o

C
o

.1

&

.2

CO

p;

CO
;-(

O
2

CD

<
a

fl

-^

CO

1^

a.

0)

u
o
be

o
c/)

<!

15

4->

ffi

SIGNALEMENT:
Tribe

Age
Length
Particular

marks

>

t^

>
W


venir

fait

de

la

178

ou des

Chine

par

Straits,

dollars ayant egalement cours la-bas.

la

remise de

La Banque de

Java,

qui en entamant la reforme monetaire avait etabli en

meme

temps des succursales sur

de Borneo

la cote occidentale

sur la cote orientale de Sumatra,

at

efforcee a maintenir

s'etait

prix de ses tirages sur tous les pays voisins en dedans

le

des limites de la parite de I'envoi d'especes.

reussit

a faire comprendre aux negociants

reglements internationaux par cheques,

temps

les

relations

peu avant avaient

et

pour

I'utilite

en

fort

de ces

peu de

divers pays, qui

financieres entre les

lieu

Bienlot on

la plupart sous

forme de remise

de pieces de monnaie, etaient modernisees en un echange

frequent de

cheques avec I'etranger. Les autres banques

privees,

agissaient

qui

depuis augmenter

dans cette direction,

deja

ont

considerablement leur debit en cheques

sur les Straits, la Chine et les autres pays de I'Orient;

maintenant

les

vu

et

ne faisaient

petits negociants, qui autrefois

des

remises qu'en especes, sont devenus des clients regu-

liers

des banques pour la vente et I'achat des

Afin de donner a I'importation europeenne

cultures la certitude

qu'ils

payements a I'etranger a
qu'en tout cas les difficultes

et

traites.

aux grandes

pourraient toujours faire leurs

parite
qu'ils

pas plus serieuses qu'autrefois,

de I'envoi

d'especes

et

eprouveraient ne seraient

lorsqu'il suffisait

egalement

d'envoyer des dollars, la Banque de Java a emmagasine a

Medan une
qui

reserve d'or etranger, specialement de sovereigns,

eventuellement pourraient servir

regler

les

soldes

crediteurs de I'etranger.

Je vous envoie ci-inclus un expose de

de

la

Banque de

Java,

ecrit

en

la

maniere d'operation

Anglais,

specialement

I'usage des etrangers qui font des affaires avec notre banque.

Vous y trouverez un expose de

la

position

d'or

de

la


Banque de Java

179

comment depuis des annees

et

met

elle

en pratique ceque M. Nogaro recommande

lui-aussi,

de vos colonies de I'lndo-Chine, c

de maintenir la

parite de I'or des

una reserve

monnaies dans

d'or hors

-a.-d.

en

les colonies

en vue

tirant

du pays. Depuis des annees

la

sur

Banque

de Java a pu operer de cette maniere avec beaucoup de

succes.

Comme

deja mis en evidence,

j'ai

il

est

bien remarquable

dans cette reforme monetaire aussi que, dans

systeme

le

monetaire des Indes neerlandaises, les monnaies a I'excep-

memes que dans

des monnaies d'appoint, sont les

tion

or de la

monnaie neerlandaise en Hollande peut

lement pour

deux banques de

les Indes; et les

la

Banque neerlandaise

collaborer

sous

et

Banque de

la

Les reglements de compte entre

patrie et entre les colonies et les autres pays

meme

avec

beaucoup

autres pays

de

d'or

et

tres

utile.

la

mere-

de I'Europe,

I'Orient,

sont par la

simplifies.

L'histoire
les

les

circulation,

Java, ont reussi

colonie

la

servir ega-

maniere

d'une

rapport

ce

la

garantie pour la valeur en

mere-patrie. C'est pourquoi la

monetaire des dernieres annees a montre dans

Straits des

difficultes, qui

ne se sont jamais presentees

chez nous.

La

transition

aussi

le

du

dollar argent (sous

1903

Straits-dollar

la

lequel on comptait
fixation

en Janvier

a eu des consequences considerables.

1906) au dollar fixe,

Les contrats passes dans

etre

avant

executes en dollars

le

temps en

fixes.

dollars argent, devaient

Ainsi les charges de ceux

qui s'etaient engages a faire des payements reguliers

c'etait

le

s'etaient

cas

avec

les

salaires,

les

baux, les rentes

augmentees considerablement par

du fixage a

2/4, et

comme
etc.,

I'augmentation

bien des personnes dans les Straits ont


meme

attribue

crise

la

180

financiere,

dont ces colonies not

en 1907-1908, pour une grande partie a cette

souffert

vation considerable de I'unite monetaire, exprimee en

naie hollandaise d'une valeur d'au-dessous de

une valeur d'environ

Le fixage du

les prix eleves

jusqu'a

de 2/4 avait en-

Straits-dollar a ce chiffre

Straits-dollar

1,40.

fl.

core une autre raison speciale.

du

fl.

la

2/-

On

avait peur qu'au fixage

valeur intrinseque du dollar, vu

de I'argent dans ce temps,

superieure

fut

a la valeur nominale, circonstance par laquelle

disparaitrait forcement de

la

soit

par vente a I'etranger.

rait

encore monter a 331/3

circulation,

Au

par refonte,

soit

fixage de 2/4

avant que

d.

dollar

le

prix pour-

le

atteinte

fut

ete

1906

le

prise

prix

331/8 d.

par

Alors

les

et

trop petite,

puisqu'au

de I'argent avait deja

mois

de

atteint

novembre

le chiffre

Straits Settlements furent

et le

fixage pas

meme

immediatement de demonetiser
un poids de

avait

de

oz.

de nouveau alarmes

quoique leur dernier dollar ne datat que de

auparavant

la

marge

valeur intrinseque. Pourtant on verra bientot que la

avait

ele-

mon-

26.957

ans

d'une annee, on resolut

le Straits-dollar

gr.

trois

titre

de 1903, qui

de 900/1000,

et

de

creer un nouveau Straits-dollar de plus petites dimensions,

meme

sorte

titre

de 900, mais ne pesant que 20.217

que le prix de I'argent pourrait monter a 44M

d'atteindre la nouvelle valeur intrinseque

Le haut fixage a

2/4,

qui a cause

meme

du

done pas

c.-a.-d.

d'eviter la demonetisation

de

avant

dollar nouveau.

de consternation,

capable d'atteindre

n'etait

le

tant

d.

gr.,

le

du dollar dans

but voulu,
le cas

ou

prix du metal argent augmenterait.

Un

autre argument pour rendre a peu pres egales la valeur

intrinseque du Straits-dollar

et

sa

valeur fixee, fut puise


dans

que

croyait

danger de

le

monnayeurs
illusion a

annees

On

fabrication de fausse monnaie.

la

valeur intrinseque

nominale on

valeur

la

la

si

181

peu

etait

inferieure

que

pourrait prevenir

les

faux

feraient des dollars a plain titre d'argent. Cette

encore ete cruellement troublee. Lorsque dans les

suivantes

le

de I'argent eut tellement baisse

prix

au-dessous de 23

qu'il etait arrive jusqu'

d.,

les

faux mon-

nayeurs semblaient pouvoir assez profiler pour reprendre

leur metier et fabriquer des Straits-dollars, surtout les dollars

plus petits de la frappe nouvelle.

Un
dans

autre point qui a ete longtemps un sujet de discussion

maintien de la parite d'or du dollar

les Straits, est le

Un

fixe.

pouvoir

specialement

parti,

pour cela que

celui

Gouvernement

le

disposer

d'une

reserve

fit

des banquiers, voulait

venir de For, afin

d'or sur place

un disagio en cas de depassement de

Un

autre

auquel

parti,

fonctionnaires du

eventuellement jusqu'a

Le dernier

ment des

aux
II

limites

I'a

et

les

tirerait

des envois de

Gouverne-

I'autre: le

forme a Londres a cette

fin

de

aux banques des cheques sur Londres

la parite

de remise en sovereigns.
opposer en quelques mots

dernieres reformes monetaires

au Mexique.

dollar mexicain (pesant 27.07281

done contenant 24.438

ou

I'espece.

Gouvernement

la parite

emporte sur

est bien interessant d'y

cents,

de

principalement

d'or et s'est declare pret a acheter et a vendre

commerce

au

parti

de

la limite

Straits Settlements a

une reserve

pour eviter

Gouvernement, preferait de former une

reserve d'or a Londres, sur laquelle le

Tor.

la parite

appartenaient

de

2s.

daise environ

Id.
fl.

gr.

On y

fixa le

de

0.902'/g,

gr. a titre fin

de metal

fin),

les

a 50 American

en monnaie anglaise (en monnaie hollan1.25) c.-a.-d.

a la proportion

de

1:

32,58.

Aussi bientot on aper^ut qu'avec I'augmentation du prix


de

valeur intrinseque du dollar mexicain

la

I'argent,

182

surpasser sa valeur nominale. Par

les dollars

la,

allait

mexicains

ont ete exportes a des montants considerables, surtout par

du Comite pour

I'intermediaire
etre

comme

vendus

reforme monetaire, pour

la

metal argent,

par contre on re^ut

et

en paiement de Tor de I'etranger.

Comme

Gouvernement mexicain

le

a des mantants tres considerables dans

dollars mexicains

un temps ou

mais

il

en a

non seulement

meme pu
pour

les frais et

d'or

prix de I'argent etait bas, cette exporta-

le

tion de dollars

avait fait frapper des

n'a pas nui

au Gouvernement,

profiler en cbargeant I'etranger

de

la peine

lui

pour

procurer une belle reserve

en echange contre I'argent exporte. Lorsqu'enfin

I'ex-

portation du dollar mexicain menacjait de prendre de telles

dimensions que la circulation interieure du pays en pourrait etre

genee,

droit de 10

Gouvernement a leve a

le

de

la valeur

mesure qui a mis

Sous tous

fin

nominale de ses propres

Mexique

un

dollars,

devenue importune.

a I'exportation

les rapports le

I'exportation

done pu que profiter

n'a

des variations du prix de I'argent pour etablir son systeme

monetaire sur la base solide de

I'or.

difference avec les Straits ou I'agio

Vraiment une grande

du

dollar

n'a

apporte

que des ennuis au gouvernement.

Comparons

enfin

quelques mots,

Alors

le

difficultes

de

comme resume

en

systeme monetaire des Indes neerlandaises.

apparait que

il

ce qui precede,

nos colonies n'ont pas eprouve de

la circulation

des monnaies hoUandaises, bien

que ces monnaies argent aient toujours conserve I'ancienne

proportion avec I'or de 1 a 155^, (la piece de fl. 2.50 a un
poids de 25 gr. a titre

bien

des fois on

argent,

fin

de

0,945), et

a tache de fausser

il

va sans dire que

aussi

mais une surveillance rigoureuse de

nos monnaies
la police

non


seulement a

I'interieur,

183

mais

encore

un

I'argent de I'etranger, a jusqu'ici produit

sant. All contraire tous ces inconvenients

resultat satisfai-

nommes

ont ete epargnes a nos colonies neerlandaises,

mes monetaires une

pu

fois terminees,

et,

ci-dessus
les refor-

nos colonies ont toujours

jouir d'une politique monetaire tranquille, tandis

parite

de

I'or

ete parfaitement

reformes monetaires n'ont pas

trouve tout de
satisfaisante

meme

les

nos relations,

de

I'importation

sur

maintenue

Et

que

puis,

la

ces

empeche que nous avons

moyens de regler d'une maniere

comme pays

d'or,

avec

la Chine,

pays d'argent par excellence.

Agreez, Monsieur, I'assurance de

ma

consideration tres

distinguee.
(s)

Ct.

President de la

VISSERING

JAVASCHE BANK.

APPENDIX

D.

Study about La Bourse d'Amsterdam"

First part of a

by Dr. G.

dam

Vissering, then

Bank,

written

Economique

the

at

request

of

Amster-

of the

of

Internationale", at Brussels,

numbers

the

in

co-manager

Revue

the

and published

January and March

906

of that

periodical.

This

part deals especially with the organization

first

and the sphere

of action of

The Amsterdam Wisselbank.

Les deux peintres

les plus

celebres de I'age d'or de la

Republique des Provinces-Unies des Pays-Bas, Rembrandt

van

Ryn

type

d'homme

et

Jan Steen, ont chacun peint de preference un

Rembrandt

special a leur epoque.

eternise

les

bourgeois

graves et

riches,

pleins de dignite;

leurs

leur

de gouvernants, mais on y retrouve en

responsabilite

meme temps

cette

traits

assurance

respirent

qu'ont

les

le

sentiment

hommes

qui

de

se

sentent capables d'accomplir leur lourde tache.

Steen

Jan

revivre

fait

devant nous

le

peuple rude des

tavernes et de la rue, insouciant en ses jours de

fete,

mais

resolu

quand

affine,

mais qui surpasse cependant de beaucoup, par son

esprit

commercial,

il

s'agit

les

de ses propres

autres

beaucoup appris dans ses

habitants

dans

des

les ports

pays

peuples

relations

lointains,

interets:

peuple peu

de I'Europe, ayant

nombreuses avec

les

dont les vaisseaux entraient

des Provinces-Unies.

185

Les types de Jan Steen se distinguent surtout par une

espece de gaminerie, de legerete, un esprit de liberte sans
limites,

mais en

meme temps

par un certain

sentiment dc

leur propre valeur.

Les deux grands

vif

et les

La

ont pris leurs modeles sur le

artistes

ont representes avec beaucoup de realisme.

diligence tranquille des magistrats, I'audace et le sen-

timent d'une liberte effrenee qui animaient

table

descendant des gueux,

grande dans

si

veri-

force de cette

c'etait la vraie

republique qui etait a cette epoque

peuple,

le

le

monde.

Ces deux extremes s'accordaient on ne peut mieux dans

un
ils

travail

commun,

bienque paraissant

et

dissemblables,

si

ne s'entendaient pas moins bien.

Les graves regents etaient fortement enclins aux entreprises audacieuses,

et,

malgre
que

parfaits, ils estimaient

Ils se

montraient, en

le

effet,

leurs

moyens de transport im-

monde

entier leur etait ouvert.

capables de fonder des colonies

en Islande, au Spitzberg, en Amerique (Nieuw-Amsterdam

devenu plus tard New- York), dans nombre

indien, et

meme

perseverance

qui

en Chine et au Japon,

en

impose,

admiration. Ils y parvenaient

gueux audacieux

d'iles

et

aujourd'hui

grace

de I'Archipel

cela

une

avec

encore,

a noire

de

'assistance

ces

qui ne reculaient devant aucune ^venture.

Ceux-ci etaient des marins tres disciplines, qui se plagaient

docilement sous I'autorite de leurs
seconds, et savaient en

commerciale de leurs armateurs.

respect pour

un

leur bateau; les

titre

capitaines

meme temps
lis

et

de

leurs

respecter I'intelligence
n'avaient pas

plus

de

de noblesse que pour un torchon de

grands personnages de I'etranger

pour eux des objets d'amusement

theatre de marionnettes. Mais

ils

comme

avaient

compatriotes qui s'etaient conquis

une

les

le

etaient

poupees d'un

respect de leurs

situation

par

leur

186

travail assidu et leurs connaissances commerciales; pour ces

gens-la,
c'est

ils

ainsi

refrenaient leur
qu'il

amour de I'independance,

et

Provinces-Unies, malgre

regnait dans les

de leurs habitants, un ordre qui ne

la liberte individuelle

semblait pouvoir etre passagerement trouble qu'en des jours

d'excitation
retabli,
le

Meme

extraordinaire.

sans violence, par

maintenir,

si

bien

alors cet ordre etait vite

le seul desir

que

les

de

la

population de

Pays-Bas etaient un refuge

sur pour tous les opprimes, pour les huguenots, pour les
juifs;

que

et

les citoyens

de ce

petit

pays etaient capables

de former par leur cooperation, par leur

but (leur propre bien
libre et exerQant

une

celui

et

de

telle influence,

effort vers

un Etat

la republique)

que

la petite

republique

hollandaise donna pendant toute une epoque le ton en

et

meme
Elle

entier,

meme

un

Europe

en dehors de cette partie du monde.

a ete le centre financier du commerce du

Amsterdam

monde

surtout joua un role preponderant.

Plus tard, le luxe

sentir son influence; I'integrite et le

fit

vrai savoir firent place a I'eclat exterieur et au favoritisme;

I'energie des concurrents etrangers

le

commerce hoUandais;

enfin le

commencja a peser sur

developpement progressif

des pays voisins, qui se formaient en

homogenes, toutes ces circonstances

grandes puissances

firent

que

la

Hollande

retrograda au rang d'une petite nation euvironnee de grands

pays. Elle devint, par voie de consequence naturelle,

un pays

d'importance secondaire; elle avait du reculer devant

la puis-

sance superieure du nombre

Malgre tout

cela, la

et

de I'accumulation des capitaux.

Hollande a pu conserver une place

de second rang, du moins en ce qui concerne

financiere.

la situation

Elle la doit a son developpement historique et

au caractere de ses habitants que nous venons d'indiquer;

aujourd'hui

encore

les

deux types d'homme, en apparence

de Rembrandt

differents,

si

187

de Jan Steen,

et

se completent et forment ensemble

une unite

s'entr'aident,

tres puissante-

L'espace reserve a cet article ne nous permet pas de faire de

cette matiere

un expose complet:

nous limiter a quelques

pour

faire

lement

c'est

pourquoi nous devons

empruntes au passe

traits

et

au present,

ressortir la signification des Pays-Bas, et specia-

de

celle

la ville

d'Amsterdam comme centre

financier-

1.

LA BOURSE D'AMSTERDAM
COMME CENTRE FINANCIER D'AUTREFOIS.

Durant

le

du XYII'=,

XVI^

le plus

meme

siecle et

dans

grand desordre

la

premiere moitie

titude regnaient au point de vue monetaire.

ou non seulement chaque pays

aussi les provinces et

meme

monnaie, des pieces de

dans

de

et

situation

cette

maniere

etait

villes

frappaient leur propre

rencontraient

titre tres different se

premier

qu'en

une epoque

chaque souverain, mais

principaux centres commerciaux.

les

d'une

des

grande incer-

et la plus

La consequence

lieu,

il

s'etablissait

une espece d'arbitrage au

naturelle

sujet

des especes, des pieces de monnaie qui avaient une valeur

nominale egale, mais dont

le

differait

titre,

la valeur intrinseque,

sensiblement; d'autre part,

naturelle de ces operations d'arbitrage fut

qui

s'en

pieces

occupaient ainsi que

les

superiorite

culation
selection

en

plus

lourdes

qu'ils

de leur poids

les

pieces

des

circulation

pieces

les

fin,

plus

lourdes

constante

les

et

la

que

basee sur

consequence

les negociants

changeurs, retenaient les

refondaient
laissant

s'appelait

repetee

de

ou mettant en
Cette

legeres.

a cause

operation

biguctter.

la
cir-

de

La mise

de pieces d'un

titre


inferieur eut forcement

valeur

de

siecle,

ce

pour consequence une diminution de

monnaie en

la

mal avait

188

pris

circulation

de

telles

moins value atteignait jusque 50

nance du 22 fevrier 1542,
devait
9

de 396 6/10

etre

octobre

1638,

de 202 4/10

as, soit

tachait

poids fin du florin Karolus

le

par un edit de tolerance du

as;

a peu pr^s la moitie de sa valeur un

L'or

mais

circulation,

D'apres une ordon-

p. c.

sous fut tolere avec le poids fin du florin

auparavant.

siecle

proportions que cette

Ducaton du Brabant, d'une valeur de

le

3 florins et trois

au cours d'un seul

n'etait

souffrait

pas aussi repandu dans

meme

cependant du

de conjurer cet affaiblissement du

la

On

mal.

des monnaies

titre

par de nombreuses ordonnances, parce que Ton voyait tres

bien

danger

le

qu'offrait

des pieces en

valeur

diminution

la

circulation,

stabilite

de cette valeur. Mais on prenait

pour

cause,

la

Ton promulgait des

et

centre les Kassiers" (Agents

Tout

le

monde

constante

que

ainsi

la

les

de

grande

la
in-

consequences

dispositions severes

caissiers).

croyait que c'etaient

eux qui

biguettaient,

qui retenaient les pieces lourdes pour remettre en circulation

les pieces legeres.

du 15

Une ordonnance de

1608

juillet

alia jusqu'a declarer

de ces gens pernicieux",

I'argent
la

ruine

avait

la ville

d'Amsterdam

que par

c'est-a-dire des

agents

le

metier

caissiers,

ete allege, reduit de neuf pour cent, et

complete de toute
des mesures

la

commune

radicales

que

devait fatalement

n'etaient pas prises.

en

resulter,

En

consequence, le metier d'agent-caissier fut completement

si

interdit et tout le

monde dut

ou payer personnellement ses

encaisser soi-meme ses creances

dettes, sous peine d'une

de vingt-cinq florins par cent

florins,

amende

dont la moitie

etait

a charge de I'agent-caissier et I'autre moitie a charge de

celui qui ferait effectuer ces perceptions.

189

Cette interdiction severe n'etait point du goCit des nego-

commer^ants de Zaandam surtout semblaient pro-

ciants; des
fiter

beaucoup des intertnediaires

gardaient leurs fonds

et

ville

29 juillet
et

faire

une ordonnance

608,

etait autorise

fois

ordonnance

rectificative

le

pour interpreter

paiements on pouvait

les

usage d'un intermediaire

et

un negociant

ne servit que ce seul negociant. Cette

stipulait en

meme

que jusqu'a ce que

la

La fondation d'une
31

Banque
telle

meme

temps que toutes ces mesures

que de nature provisoire

et le

apres,

a avoir un caissier hors de la maison, pourvu

qvie ce caissier

en 1608,

pour cette raison que

C'est

Pour

la precedente.

une seule

n'etaient

ecrit.

d'Amsterdam promulguait quinze jours

mitiger"

caissiers,

effectuaient des paiements ou des

perceptions sur leur ordre

la

en qualite de

qui,

et

ne resteraient en force

projetee fut installee.

banque

etait

done deja annoncee

Janvier 1609 I'ordonnance de la

Banque

de change d'Amsterdam (Amsterdamsche Wisselbank),

tuant cet etablissement, fut publiee.

de cette ordonnance, on a

cite

Dans

comme

les

insti-

considerants

premier motif de sa

fondation le desir d'arreter la reduction et la confusion des

pieces de monnaie et la necessite de mettre ordre au change

des monnaies par la fondation d'une banque de change. Les

principales dispositions de cette ordonnance furent les suivantes: toute personne pouvait deposer a la

monnaies, masses, grenailles et billons

retirer ces

toutes

qu'il lui plaisait et

memes monnaies ou la valeur

comme elle le voulait. (Sous

mentionnees

Banque

des masses susle

mot de mon-

monnaies ayant cours au-

naies",

on comprenait toutes

torise;

sous celui de ..masses", des blocs ou des barres de me-

tal

les

precieux; sous celui de grenailles", des grains de metal

precieux, et sous la denomination

autres

pieces

de

billons",

toutes

les

de monnaies non autorisees ou etrangeres).


Le depot
vait

dont

lui,

de sa

etait

il

etait

de 300

crediteur a raison des valeurs deposees

sous peine d'une amende de 3

La Banque pouvait

traite.

Nul ne pou-

florins.

Banque pour un montant superieur a

disposer sur la

celui

par

moins eleve

le

190

p. c. et

de I'ecartement

echanger

aussi

les diverses

monnaies moyennant un benefice aussi minime que

Un

second motif qui a amene

de

la fondation

la

possible.

Banque

parait avoir ete

le

caissier

charger la Banque elle-meme. Afin

d'en

et

desir

de r^glementer

teindre ce but, on declara qu'a

fonctions de

les

du 14

partir

d'at-

1609

fevrier

tous les effets de 600 florins et au-dessus qui circulaient a

Amsterdam devaient

etre payes a la

Banque,

afin

que

les

fonds dont on disposait par traite pussent etre payes plus

surement
contraire,

et

dans de meilleures conditions; que, dans

les

effets

le

comme

payes seraient consideres

cas

etant

irregulierement payes, avec application, par la suite, d'une

amende de

25 pour chaque cas. C'etaient des prescrip-

fl.

tions tres severes, mais pas contre la

des avantages speciaux.

La

ment responsable pour tous

ville

les

Banque

d'Amsterdam

off rait

aussi

etait entiere-

engagements de

la

Banque,

sans exception, et cela d'une fapon illimitee; les valeurs qui

y etaient deposees ne pouvaient etre

En

saisies

remuneration de tous ses services,

la

vait qu'un demi-sou par cent florins, soit

mille, aussi bien

en effectuant

en recevant

le

Nous avons
de

cette

traite

rece-

done un quart par

depot qu'en le restituant, ou

les paiements. Elle realisait

nefice sur I'echange d'une espece de

tion

par personne.

Banque ne

en outre un petit be-

monnaie contre

d'autres.

d'une fa^on assez detaillee la fonda-

banque de change, parce que des ecrivains de

I'etranger en ont souvent parle d'une maniere inexacte. lis

croyaient que cette creation etait dictee par un sentiment

d'avidite

de

la

part de la

ville

d'Amsterdam. Rien

n'est


moins vrai
etaient

si

benefices.

meme

commissions prelevees par

les

(1):

minimes

Le

191

que plus tard

fait

Banque

la

pouvait etre a peine question de

qu'il

la

Banque

quand

realisa

des benefices notables, fut du a d'autres causes qui

n'etaient pas prevues lors

de sa fondation. Qu'il nous

permis

sur

encore

d'insister

cette

matiere,

soit

parce que la

Banque de change d'Amsterdam, malgre son organisation

imparfaite, voire

meme

rudimentaire, a joue un role extra-

ordinaire dans la vie financiere de toute I'Europe.

Son organisation
a peine

peut

son origine etaient bien naives.

et

On

reprimer un sourire en lisant I'ordonnance

qui precedait son

institution

et

qui

n'admettait I'existence

d'un caissier qu'a la condition que celui-ci ne tint la caisse

que d'un seul negociant. De meme, en ce qui concerne

les

causes de I'affaiblissement des monnaies et les

qui

mo3'ens

devaient permettre de mettre un frein a ce mal, les

idees elementaires, qu'on y trouve, etaient tout aussi simples

qu'inexactes.
servir

La banque de change elle-meme

a la lutte centre I'affaiblissement des monnaies, qui

continuait

toujours,

mais

but que ses fondateurs

laient

devait bien

ne tarda pas a s'ecarter du

elle
lui

avaient assigne, lorsqu'ils par-

avec tant de mepris des agents

pernicieux" dont
antra dans la

ils

meme

demandaient

caissiers, ces

la suppression.

elle

ne biguettait plus

lourdes, elle demandait

un agio pour ces pieces sur

courante

de

(1)

et

La banque

voie que ces derniers; mais elle

sous une autre forme. Si

s'assurait

la

sorte

le

meme

V: La richesse de la Hollande, t.
MDCCLXXVIII. Cot ouvrage public

1.

gens

le fit

les pieces

la

monnaie

avantage que

p. 153, edite a

Lon-

sans uom d'auteur,

est presume avoir ete ecrit par Accarias de Serionne. Quelques
annees plus tard, une traduction en langue hollandaise a paru,
revue et surtout amplifiee par Me Elias Luzae, avocat en Hollande.
clres

192

d'autres s'efforQaient d'obtenir par la refonte des pieces. Plus

meme

tard elle fut

publiquement autorisee a proceder

ainsi.

de constater comment la banque devait

est interessant

11

arriver a suivre cette tactique, et

comment precisement

les

consequences de cette tactique inconsideree ont contribue a

Banque de change d'Amsterdam

assurer a la

une reputation universelle de

tion

et a sa direc-

stabilite

et

de probite.

Pour abreger, nous limiterons nos considerations a

qui etait alors le principal etalon,

moindre

importance

d'une

I'or

pour

I'argent,

etant a cette epoque

les

Suivant

Pays-Bas.

I'ordonnance (placaat) des Etats-Generaux du 21 mars 1606,

de

unites

les

monnaie d'argent

la

d'un poids fin de 224 9/10

2.35)

Le Rixdale

une valeur courante de

neerlandais, representant
(fl.

etaient

(un as

as,

grammes, de sorte que 200 as ^9.61 grammes

sous

fl,

^0.04806

fin.

Le

florin

des Pays-Bcis a contenu jusqu'en I'annee 1839, 9.61 gr.

fin;

depuis la reforme monetaire de cette annee, son poids

fin

d'argent est de 9.45

valeur de

sous

18

fl.

L'ecu au lion (leeuwendaalder) d'une

gr.).

225 2/10 as d'argent et

il

1.90),

(fl.

existait

avait

un poids

de

fin

une piece de dix sous de

moindre importance. Nous avons vu qu'une des principales

raisons de la fondation de la

Banque de change

de sorte que

titre inferieur,

saient

un agio de

9 p.

tolerance du 28 juin

les lourds rixdales

c. trois

ans apres

de

d'un

titre

1/2 p.
titre

de

c.

fin

En

du

legaux

606. Deja par

de 220 2/10

2 florins 8 sous

as, soit

un

fai-

une

(fl.

2.40)

affaiblissement

d'autres mots, les anciens rixdales lourds,

de 224 9/10

as, faisaient

un agio de

La Banque de change debuta done avec une

fixe

monnaie de

608, le Rixdale neerlandais devait etre

admis pour une valeur courante de

avec un

grande

fut la

indignation que causa I'importation de pieces de

1/2 p.

c.

unite (taxe

6 juillet 1610) de 220 1/5 as fin par florin d'argent.

13.

193

Par consequent, pour toute monnaic de

a la Banque, le deposant fut porte

Banque pour un meme montant de

La Banque

dans

titrc

deposee

de

les livres

la

credit.

pas uniquement caissier et

toutefois

n'etait

meme

banque de

transfert

(giro)

monnaie, et

elle etait

obligee d'acheter tout billon ou toute

mais avant tout changeur de

monnaie non autorise ou de I'echanger contre

Ce

legale.

billon fut achete

du metal; presque toujours ce

la

monnaie

fait

1617

en

f rapper,

a celui de

Entre-temps des monnaies nouvelles

legale.

que I'archiduc Albert

argent,

le titre fin

titre etait inferieur

constamment leur apparition dans

ainsi

monnaie

la

ou echange d'apres

et

les

firent

Provinces-Unies;

c'est

et I'archiduchesse Isabella avaient

1618,

deux pieces nouvelles en

ducaton qui entra dans la circulation pour

le

florins et 3 sous

patacon ou rixdale a

3.15) et le

(fl.

la croix

kruisryksdaalder", qui valait dans la circulation 2 florins et

10 sous

2.50).

(fl.

La

valeur de nos pieces legales fut aussi

augmentee par des ordonnances tout en gardant

titre

de

fin;

I'ecu

au lion

fut porte

de

fl.

le

meme

1,90 a 2 florins

par ordonnance du 26 septembre 1615, I'ancien rixdale neer-

ordonnance du

landais de

fl.

2.40 a

fl.

Comme

le

meme

poids de 428 as argent par ecu au lion

2.50 par

21 juillet 1622.

et de 528.5 par rixdale avait ete conserve, le titre fin par

unite d'un florin fut diminue par cette augmentation de prix

et s'etablit

respectivement a 214 et a 211 4/10

affaiblissement de la

monnaie se

par une nouvelle diminution de 4

suivit, cette fois encore, ces

credit

sur ses livres

d'argent.

Le ducaton
ne

fut plus

p.c.

en

de compte

fin

La Banque de change

augmentations, de sorte que

des

ne pesait que 637

fl.

1622 sur

meme

s'etablit

toutefois

avec une valeur courante de

florin fin

traduisit

Ce nouvel

as.

3.15,

la

le

base

7/10

as

ce poids reduit a un

que de 202 4/10 as contre

21

4/10 pour

194

rancien rixdale, et centre 214 as

fin

de 1619

lion.

1622) pour I'ecu

et

meme

pour

unite

de

au

204

fin

situation etait la

Le ducaton

9/10.

valaient done intrinsequement 5 p.

la circulation

menta dans une

plus

La

patacon; celui-ci pesait 512 4/10 as ou par

le

florin

Bien que

ordonnances

(suivant

anciennes

plus

et

patacon

le

et 4 1/2 p. c.

de ces pieces

mesure que

telle

et

c.

en moins.

fut defendue, elle

aug-

les pieces hollandaises

disparurent bientot de la

lourdes

circulation.

Posterieurement a

638, lorsqu'enfin le ducaton et le pa-

tacon furent officiellement admis, les autres pieces firent un

agio de 4 a 5

que

n'apparurent plus dans la circulation

p. c. et

comme pieces

commerciales.

La Banque de change

d'

Am-

sterdam avait toutefois ouvert ses comptes en rixdales

ecus au lion anciens.

En

et

cas de depot en nouvelle monnaie

courante a la Banque, celle-ci la reduisait d'apres la valeur

de son

de

titre

fin

en unite de I'ancienne monnaie qu'elle

avait conservee. D'autre part, elle effectuait, sur

des

paiements

en

monnaie nouvelle a raison de quelques

pour cents au-dessus du pair de

elle.

la

monnaie conservee par

Par resolution du corps municipal du

Banque

demande,

aout 1645, la

re9ut instruction de payer en especes speciales, qui

lui seraient

demandees, mais, des

elle

lors,

fut

en

meme

temps autorisee a demander un agio raisonnable pour ces

especes.

Si

done un ayant-compte

ne monnaie legale,

Banque dont

il

demander un agio
fut

que

les

c'est-a-dire la

etait

credite,

sur la

la

desirait recevoir I'ancien-

monnaie

Banque

officielle

de la

etait autorisee

monnaie courante. La consequence

comptes en banque, qui etaient toujours tenus

dans I'ancienne monnaie,

allaient faire

un

espece

de valuta a part se formerait,

qui ne

fut

plus

versee

ou

transferee

la

en

agio

et

qu'une

monnaie banco,
grosses

pieces

195

dont on ne pouvait aisement se servir dans

d'argent,

circulation,

la

mais qui se negociait a peu pres exclusivement

par transfer! dans les

de compte en compte, formant

livres,

une espece de monnaie de reglement.

ainsi

Le

public restait cependant fermement convaincu que pour

chaquc

florin

de monnaie de banque,

de I'etablissement,

avait in

celui-ci

inscrit

dans les livres

natura dans ses caves

un

florin

fin

d'au moins 211 4/10. C'est ainsi qu'Adara Smith decla-

rait

en metal argent, calcule sur la base de

entre autres

I'unite

Wealth of Nations, Book IV, Chap.

At Amsterdam no point

of faith

Ill)

better established than

is

bank money, there

that for every Guilder, circulated as

is

a correspondent guilder in gold or silver to be found in

the

treasure

of

bank".

the

Cette

absolument

conviction,

exacte au debut, mais qui ne fut qu'une fiction plus tard,

assura a la monnaie de banque
telle stabilite

dans toute I'Europe une

de valeur que Ton

alia jusqu'a

monnaie de banque comme mesure de

plus tard,
pieces,

peu

considerer la

valeur. Aussi,

quand

au cours des annees 1681 a 1691, de nouvelles

une de

inferieur (de 201

de nouveau admises
jours pour sa

une d'un

trois, et

florin,

d'un

titre

1/100 et de 200 3/100 as

quelque

fin),

furent

que

la

banque conservat tou-

monnaie de banque

le

titre

et bien

de

fin

de 1622,

y eut toujours moins de raisons pour demander le paiement de la monnaie de banque en grosse monnaie d'argent.
il

En

effet,

les

valait a celui

grosses pieces d'argent, dont

de

la

le titre fin equi-

monnaie de banque, avaient peu a peu

presque completement disparu de

la circulation; elles etaient

hors d'usage, et n'etaient plus considerees que

naie de

sur

commerce, que

demande

Cette

speciale,

conviction,

la

banque

pour

comme mon-

voulait bien encore ceder

la facilite

que de bonnes

des commer^ants.

et

lourdes especes de


monnaies,

196

un agio d'environ

faisant

p.

etaient

c,

pre-

sentes dans les caves de la banque en couverture de la

monnaie de banque,

La Banque

ces.

etait

confirmee en diverses circonstan-

fut

placee sous la haute surveillance des

quatre bourgmestres d'Amsterdam.

mestres etait souvent renouvele

chaque nouveau College

et

de bourgmestres devait controler

Le College des bourg-

le tresor

caves de le Banque, le pointer sur les

depose dans les

livres,

reprendre

les

valeurs et les remettre entre les mains du College suivant.

Les colleges qui se succedaient entraient souvent en foncde

tions a la suite

petits

mouvements

ne se composaient pas toujours d'amis,

jamais

qu'un

arrive

college

ait

done

politiques;
et

accuse

cependant
qui

celui

il

ils

n'est

I'avait

precede, quoiqu'etant des antagonistes.

La Banque donna une seconde preuve de son

en

XIV

lorsque Louis

1672,

integrite

envahit la Republique hol-

landaise a la tete de ses armees et s'avanga jusqu'a Utrecht.

Dans
la

les

par cette invasion ennemie,

jour que I'argent ne fut plus en siarete dans

payer immediatement leur avoir en banque.

de I'argent courant qui

la rarete

suite
le

fit

caves de la Banque et nombre de gens voulurent se

faire

de

le desarroi general, cause

crainte se

de

la

hate

etait

avoir, la

monnaie de banque

une courte periode un disagio de 5 p.

que

apparut

il

prompte a rembourser

meme

des

avec

I'incendie

fournissant

de

tranquillement
la

la

fit

pendant

c.

Banque de change

etait tres

les soldes crediteurs et qu'elle payait

pieces qui portaient encore les traces de

I'hotel

ainsi

raison

avec laquelle certains voulaient recevoir

montant de leur

Quand

En

en cours et par

la

dans

de

ville

datant

preuve que
les

monnaie de banque

de plusieurs annees,

les pieces etaient restees

caves de

la

Banque,

le cours

de

se retablit bientot et ne tarda pas

remonter

Adam

au

dessus

du pair de

Smith aussi bien que

paragraphe
incendie

2)

depose

affirmation

Banque

et

pas

ces

consideration

absolument

tout

fondee

ete

ville avait

Toutes

qu'ainsi

reste

etait

n'etait

avait

de

I'hotel

chapitre 22,

(livre I,

peu apres

declare

Banque de change
I'argent

Say

J.-B.

monnaie courante.

la

font mention de ce fait en ajoutant

serait

se

197

dont

depuis I'origine.

exacte, attendu

en

1609

que

et

que

Cette

que

I'incendie

la

de

eu lieu en 1652.

circonstances

la

a augmenter la

contribuaient

Banque

la

inusitee

etait faite

intact
fait

cet

fondation de la

la

preuve

la

que

jouissait

demande de

et

aussi a rendre

restitution

de monnaie

banco ou d'ancienne monnaie lourde, de sorte que des

annees plus tard
si

la question fut

meme

Banque pouvait bien encore

la

soulevee de savoir

etre consideree

comme

obligee de restituer les depots en monnaie de banque pro-

prement

demande de

dite, si la

restitution lui etait faite.

Les gerants et les employes de la

Banque

etaient soumis

a des prescriptions tres severes; une discretion absolue etait

prescrite pour tout ce qui touchait a la gestion de la Banque,

Les

pendant

bien

aussi

plus

cette

tard;

falsifications

qu'on etait attache a ses services que

discretion
etaient

etait

punies

garantie par le serment.

de

peine

la

de mort;

il

advint une fois qu'un comptable de la Banque, Fliek, con-

damne

mort,

fut

execute

commis des faux dans son

Un

etablissement

le

11

travail

financier

mai 1673, pour avoir

[Codex Batavics,

qui jouissait d'une confiance

aussi illimitee devait inevitablement jouer

durant la periode mouvementee des

Bien que

le

systeme monetaire

dans notre pays,

la

Hollande

p. 1177).

XVIP

fut loin

faisait

un role important

XVIIP siecles.
d'etre stable, meme
et

neanmoins une exception

favorable par rapport aux autres pays

La

ville

d'Amsterdam,

198

grace a son port excellent et a ses relations maritimes qui

tique

et

entier, etait

commerce, surtout pour

de

centre

monde

au

s'etendaient

devait aussi

elle

un centre d'operations

devenir

Des etrangers comprirent

leurs fonds dans

de la Bal-

les produits

des lointaines regions indiennes;

inevitablement

aussi

peu a peu devenue un

I'avantage

enfin

financieres.

du

depot de

un etablissement jouissant d'une reputation

excellente;

et

sommes importantes

confierent des

ils

a la Banque de change d'Amsterdam.

Par

les caves
re(jus

du

suite

de

Banque, on

la

des

non-retrait

vit se

especes

se trouvant dans

developper des transactions en

de cette Banque pour des sommes deposees, par conse-

quent en des virements dans ses livres Nous avons dejavu que
tous les effets payables a

Amsterdam, ou

tires sur

Amsterdam,

devaient, suivant I'ordonnance, passer par la

Banque

consequent, etre payes en monnaie de banque.

La

sur

Amsterdam

apportait des valeurs considerables en

precieux d'Amerique en Europe;

il

s'etablit ainsi a

un commerce de metaux precieux

et

par

navigation

metaux

Amsterdam

de diverses monnaies

et

etrangeres, qui fut de nouveau effectue par des virements de

la

Banque de change.

leurs

effets

payables

Des negociants de

Amsterdam, dans

avec la monnaie banco de

d'obtenir

d'Amsterdam une valeur

I'etranger creaient

la

la

conviction

Banque de change

fixe.

Chaque matin, des transactions importantes en monnaies,

effets et re^us

a-dire

en

de

Banque de change d'Amsterdam,

la

c'est-

virements de cette banque, avaient lieu dans

rue devant I'hotel de

etait etablie.

ville,

dans lequel

Ces transactions prirent

fication

internationale

des his,

liv.

XXII,

Pour fixer

la

chap.

X,

Banque de change

meme

que Montesquieu,

la

une

telle signi-

dans son Esprit

declarait:

la valeur relative (de la

monnaie) les diverses

199

nations se regleront beaucoup sur celle qui a le plus d'argent.

vSi

d'argent que toutes

elle a autant

faudra bien que chacune

mesurer avec

aille se

fera qu'elles se regleront a

autres ensemble,

les

peu pres entre

elles

elle,

il

ce qui

comme

elles

se sont mesurees avec la nation principale.

Dans

I'etat actuel

de

I'univers, c'est la

Hollande qui

est

cette nation dont nous parlons.

Les Hollandais reglent

le

change de presque toute I'Europe

par une espece de deliberation entre eux, selon

qu'il

convient

a leurs interets."

Quant a I'importance de

Banque d'Amsterdam,

la

William Temple constatait: In

famous bank, which

tlie

imaginary,

or

that

Amsterdam

this cit}^ of

is

the greatest treasure, either real

is

known any where

is

Sir

in

the world".

(Observations upon the United Provinces of the A^ethcrlands,

London, 1673, chap.

Cette

II,

p.

99).

d'Amsterdam coincida avec

surtout

de

la

de

de prosperite

periode

la

Banque de change
Republique

I'age d'or de la

et

d'Amsterdam, un peu plus d'un demi

ville

Car, parmi les Provinces

siecle apres la paix de Munster.

Unies, celle de la Hollande etait de beaucoup la principale,

en Hollande

et

qui

dictait

c'etait la

ville

sa volonte

tout

pouvait faire autant de projets

militaires

prises

d'Amsterdam presque
le

pays.

Le stadhouder"
pour des entre-

qu'il voulait

ou autres, mais

si

seule

Amsterdam ne

les ap-

prouvait pas, les projets n'etaient pas executes.

La Hollande pouvait
moitie

du XVII'^

siecle

seaux de commerce

(1);

entretenir

une

flotte

deja

dans

de plus de

en 1704, I'armee de

la

la
1

premiere

3,000 vais-

Republique

comptait 150,000 hommes, les depenses militaires de la

(1)

V. Blok,

t.

meme

IV, pp. 11 etsiiiv. ,Hisfor?-edu2'>ciipleneerla7idais,

et le? eerivains cites

par

lui.

annee s'elevaient a

200

de

25,000,000

florins

valait bien plus en ce temps; la plus

depenses

siecle

si

et

grande partie de ces

supportee par Amsterdam.

etait

Cependant,

change

en monnaie qui

germe du mal auquel

le

renommee

devait succomber

demi environ plus

si

cette

Banque de

miserablement, un

tard, existait deja

dans cette

periode glorieuse.

La Compagnie
pagnie),
etait

qui

des Indes orientales (Oost-hidischc Com-

avait

fondee au debut du XVII^

ete

devenue une association

chaque annee de grandes

aux Indes a
ses par cette

tres puissante qui envoyait

flottes

ses propres frais. Bien

Compagnie

siecle,

guerre

et qui faisait la

que

les benefices reali-

fussent tres considerables,

il

arrivait

souvent qu'elle avait besoin d'especes pour ses equipements

importants.

La

direction de la

bourgmestres de

la ville

Compagnie comptait

d'Amsterdam,

aussi la haute surveillance de la

ses

membres. Bien

qu'il

les

aussi les

memes qui

avaient

Banque de change, parmi

eut ete expressement defendu a la

Banque de change d'accorder a n'importe

qui

du

credit

audessus de son depot, et que la seule creation d'effets sur

la

Banque pour un montant

punie d'une amende de

la

Banque de change

aout 1657 a la

gage
se

3 p.

c.

et

avait deja,

de I'ecartement de

I'effet,

semble-t-il, accorde le

Compagnie, une avance en especes contre un

d'obligations.

presenterent

qui surpassait I'avoir du tireur fut

Depuis cette

date; ces operations d'avance

k diverses reprises et en 1676 I'avance se

montait deja a 2,000,000 de

florins.

Ces avances ne furent accordees que sporadiquement au

debut

mais

le

conseil

municipal prit une resolution

le 5

octobre 1682 en vertu de laquelle la Compagnie des Indes

orientales pourrait disposer en tout
1

temps d'une somme de

,700,000 florins en monnaie banco sans qu'il

lui fut

necessaire

'-

201

pour cela de demander une autorisation speciale. Eii 1698,

ces avances s'elevaient deja a 3,200,000 florins et elles furent

chaque

fois

approuvees par des resolutions successives de

On

municipalite.

un

interet

ce que

meme, durant lesannees 723

fixa

chaque

fois

de plus

724,

Ce mal

c.

des pro-

prit

en plus etendues; on constata plus tard,

par les livres de la Banque,

0,000,000 de

moins eleve pour cette avance,jusqu'a

cet interet fut reduit a 2^/2 p.

portions

et

la

florins

qu'il n')' avail plus,

de monnaie lourde sur

en 1760, que

les 30,000,000

de

Mees, Bank-wczen in

florins qui devaient etre presents. (Voir

Xederland).

Ce ne

pas seulement

fut

Compagnie des Indes

la

qui re^ut des avances, mais le

orientales

Gouvernement municipal pa-

rut aussi accorder a des organes places sous sa propre di-

avances en monnaie de

rection

des

que

chambre de pret de

la

une somme de
avait,

comme

il

Banque.

semble

Gouvernement

fut declare, prelevee sur le tresor

le

II

en I'annee 1775

2,000,000 de florins que le

mise en reserve pour aider

et

la

la ville recjut

de

la ville

commerce par des

prets

en des temps de tension monetaire.

II est

ferme

curieux que rien de tout cela ne transpirat et que la

conviction

persistat

que

la centre- valeur en especes

metalliques des comptes dans les livres etait encore toujours

entierement presente. Vers

men9a a perdre son agio

790, la

monnaie de banque com-

et en aout

790, elle ne valait deja

plus que ce que valait I'argent courant; la baisse continuait

et

en novembre

il

y eut

meme un

disagio de 2 p.

c.

audes-

sous de la monnaie courante.

Ce phenomene peu commun de

par susciter

de

la

la

finit

mefiance, aussi bien en Hollande qu'a

I'etranger et bien que la municipalite

r'at,

monnaie banco

d'

Amsterdam

par une notification hautaine, d'attenuer

I'effet

s'effor-

des bruits

202

defavorables qui couraient, I'envie de retirer son argent de

Banque augmentait. La-dessus

la

Banque a

remettre, a partir

du

la municipalite autorisala

novembre

de I'argent

790,

en barres a toute personne qui avait un compte chez

pour un prix de 26

et ce

naie de

florins

banque par marque

15 sous

(fl.

26.75) en

elle

mon-

d'argent.

Etant donnee toutefois la valeur monetaire de I'argent de

eleve

titre

que

Banque

la

toujours admise pour la

avait

reduction de la monnaie de banque en monnaie courante, ce

prix n'aurait pu s'elever a plus de 24 florins

petite

fraction

(1).

{fl.

24.2) et

une

C'est pour cette raison qu'en vertu d'un

public par la municipalite, la monnaie de banque fut

avis

declaree affaiblie de

p. c.

Cette mesure ebranla tellement la confiance qu'on

I'inter-

comme le desir de la Banque de passer un arrangement

de 90 p. c. On insista pour qu'elle satisfit a ses engagements et
ne payat plus en barres, mais en especes. La municipalite

preta

des objections, pretendant craindre que de cette fa(;on les

fit

bonnes especes en argent quittassent

pays; elle emit

le

ficiellement I'opinion qu'il etait douteux que la

Banque

obligee de payer en especes. Elle excipait ainsi d'un

etabli

pour

Enfin, la
santes

en

comme un

Banque dut ceder devant

Mais apres avoir paye

suspendit ses paiements

Une

fait

fut

non

droit acquis.
les reclamations pres-

et toujours renouvelees en reprenant ses paiements

especes.

elle

le representer

of-

enquete qui suivit

le

millions en especes,

fevrier 1791.

demontra que

de

la direction

la

Banque, contrairement aux prescriptions expresses, avait accorde deja depuis longtemps des avances en prelevant
ens sur I'encaisse d'argent de

la

soutenir I'etablissement, on decida, le

(1)

Voir Le Long, Commerce

Banque. Dans
1

fevrier

d' Amsterdam,

tome

les

le

moy-

but de

791 d'emettre
,

I,

p. 186,

203

un emprunt de 6 millions a charge de

a 3 1/2

la ville, portant interet

emprunt qui pouvait etre paye en monnaie

p. c. I'an,

de banque ou en especes. Le credit de

retabli

au

tint

pour un certain temps,

meme

la

Banque

fut ainsi

monnaie de banque se

et la

niveau que la monnaie courante.

I'epoque des troubles menatjants de 1794 et de la deso-

du marche monetaire qui se produisit simultane-

rientation

ment, la monnaie de banque subit una nouvelle baisse

1

octobre

794,

tomba meme

elle

84

jusqu'a

p.

c.)

(le

Au

cours des premiers mois qui suivirent, la monnaie de banque

fluctua

92

entre

I'annee a 89 p.

Ce ne
de

p. c,

fut qu'apres la revolution

commerce
le

1/2

finir

a la fin

fut

de

de 1795 que

la situation

exposee par un comite de

clairement

de navigation, qui deposa un rapport

et

fevrier

pour

c. (1).

Banque

la

84

et

795.

Ce rapport declara

suivant les livres de la Banque,

il

pviblic

qu'il etait vrai que,

n'y avait pas eu de deficit,

mais que des sommes considerables avaient ete prelevees

sur I'encaisse metallique de Vetablissemcnt pour faire des

avances a la tresorerie de la

ville et

a la chambre munici-

pale de prets. Ces avances s'elevaient en tout a un peu plus

de 9 millions de

florins

avait ete constitue en

monnaie banco, pour lesquels

gage des obligations de

la

il

Compagnie

des Indes orientales, garanties par les Etats de la Hollande

et

de

dam
la

la Frise occidentale,
et

des obligations de la

ville d' Amster-

des obligations des provinces de la Hollande et de

Frise occidentale, d'une valeur nominate totale de pres

de 9 millions de

florins;

quelques prets avaient ete accordes

sans gages.

(1)

Voir W.

Hollande.

C.

Meos. Flisloirf de la prafique des Banques en

Banque de change d'Amsterdam

Cette histoire de la

preuve nouvelle du danger

line

gestion d'une

banque entre

dans

qui

cas

le

pu

n'avaient

en temps de

les

y a a remettre

qu'il

la

magistrats de la ville

les

resister a la tentation d'accorder des

crise,

est

mains des autorites publiques;

nous occupe,

avances

contrairement au reglement de la Banque,

probablement parce

et

204

qu'ils croyaient

agir ainsi dans

I'in-

teret public,

a ete commise a

erreur

Cette

plusieurs

dans

reprises

d'autres pays et nous ne pouvons done pas trop blamer les

de

directeurs

en

qu'il

aucun

soit,

la

Banque de

leur action

on pent constater avec

fait n'a ete

Quoi

incorrecte.

satisfaction

que jamais

decouvert qui permit de soupQonner que

des avances auraient ete accordees a des personnes privies

faveur de la direction, ou que des malversations, de

en

quelque nature que ce

n'ont

soit,

auraient eu

Les directeurs

lieu.

done pas perdu leur grande reputation de probite

cet egard;

la,

ou

ils

ont dispose de I'argent,

ils I'ont fait

faveur de corporations ou d'institutions publiques

pour servir

avis,

I'interet

public;

si

done

ils

ont

regies absolues d'une bonne politique financiere

pas

failli

a,

en

a leur

et,

failli
ils

aux
n'ont

a I'honneur et a cette dignite dont un Rembrandt

les avait ornes.

Grace a remission de quelques emprunts communaux consecutifs, le

faire

face

Gouvernement de

la ville

a tons ses engagements.

retablir I'agio

de

la

avait

monnaie de banque en

ayant-compte recevraient de
courante par retrait de

Le Gouvernement

d'Amsterdam put enfin

la

Banque

,000 florins de

meme

stipulant

1,040

fl.

voulu

que ses

de monnaie

monnaie de banque.

avait espere retablir ainsi le credit de la

Banque de change; par diverses prescriptions forcees il

tacha de rendre a la Banque la consideration dont elle avait


joui anterieurement.

vains;
la

le

Banquc

Tous

205

dans ce sens, resterent

les efforts,

commerce

avait

et I'ancien

etablissement mourut d'une mort natu-

a se tirer d'affaires sans

appris

apres avoir langui pendant nombre d'annees, durant

relle,

Banque ne purent

lesquelles les frais d'administration de la

meme
Le

que pour

etre couverts
9

decembre 1819

la

leur cinquieme partie.

Banque de change

fut officiellement dissoute et le

d'

Amsterdam

1820, la munici-

19 Janvier

palite annontja qu'il n'y aurait plus lieu a d'autres operations

que

pour

celles qui seraient necessaires

devait

Elle

terminee

etre

en

la liquidation.

mois

six

la

et

monnaie

de banque devait etre payee a raison d'un agio de

Dans

en

I'intervalle,

Banque

qui

neerlandaise,

eut lieu

1814,

dorenavant

remplir

devait

p. c.

fondation de la

la

les

fonctions de banque de circulation dans les Pays-Bas.

L'histoire

de la Banque de change d'Amsterdam

est tres

remarquable a divers points de vues. Son organisation

extraordinairement primitive des
la duree de

autre

chose

son

que

existence.
la

debut

le

vrai

et

dire,

fut

pendant toute

elle

n'avait ete

gardienne des especes d'autrui; selon

I'ancienne conception de I'agent-caissier, elle ne pouvait en

aucun cas accorder des credits depassant

especes deposees;
si

le

fait

qu'elle en

considerables resta un secret jusqu'a la

La Banque

tenait ses

le

montant des

accorda neanmoins de
fin.

comptes en une monnaie qui

n'etait

plus courante et toutes les especes courantes qu'elle recevait

devaient

etre

reduites

en cette

peu a peu devenue presque

toutes

sa
a

meme monnaie

fictive.

Ce sont precisement

ces prescriptions naives qui ont contribue a etablir

grande reputation. Le mystere dont

ete

qui etait

pendant longtemps un

de ses

Lorsque quelque chose transpirait,

elle etait

entonree

elements de force.

c'etait

exclusivement en


faveur de

Banque; on

la

florins qui fut

206

cite

ce

cas d'un vol de 43,000

commis au prejudice de

la

Banque en novem-

bre 1686; sans hesiter un moment, les bourgmestres verserent

immediatement

le

montant

soustrait

dans

les caisses

de

la

banque, a cause de la responsabilite, publiquement reconnuo,

de

la ville

d'Amsterdam.

Toute I'organisation

que

les

retrait

ayant-compte

monnaie

de

etait

de banque,

de leur
la

et

pour eviter

etablie

d'ailleurs

disposassent

avoir par le

discretion

absolue

qu'observaient toutes les personnes attachees a la Banque,

sans exception aucune, a contribue a fairs regner I'obscurite
sur le veritable etat des choses.

Aussi des racontars fantastiques circulaient au sujet de

I'importance du tresor qui se trouvait dans les caves de la

Banque. Plusieurs ecrivains

de
II

florins;

est

un

tel

montant

n'a cependant jamais ete atteint.

bien arrive qu'a un

moment donne

personnes eurent un compte a

total

de

comptes

ces

millions.

Adam

quand

citait le chiffre

il

On ne
la

doit

pas,

la

plus de 5,000

Banque, mais
qu'un

n'atteignit

Smith se

900 millions

I'ont porte a 800, a

le

montant

peu plus de

rapprochait le plus

de 33 millions de

de

30

la verite

florins.

en se basant sur cette organisation de

Banque de change, conclure que

le

commerce en general

se faisait d'une fa^on aussi primitive a cette epoque. II est

vraiment curieux

genre aient aussi

la

que deux autres etablissements de ce

existe, a cette

epoque, dans les Pays-Bas:

Middelburgsche Wisselbank (Banque de change de Mid-

delbourg),

mars

fondee par decret du Conseil municipal, du 28

1616,

et

la

Rotterdamsche

Wisselbank (Banque de

change de Rotterdam), fondee par

en

1635.

instituts

La

veritable

la ville

de Rotterdam

cause de la fondation de ces deux

semble encore avoir 6te

la

meme que

celle qui a


amene

la

Banque de change d'Amsterdam

fondation dc la

et leur organisation,

207

du moins au debut,

La Banque de change de Rotterdam

fut identique.

se distinguait cepen-

dant de celle d'Amsterdam, en ce qu'elle ouvrait, a cote

des comptes en monnaie de banque qui
toujours
la

un

agio, des

Banque de change de Rotterdam

comme

celle

faisait

d'Amsterdam,

n'exigeait done pas,

que tout depot en monnaie

courante fut reduit en monnaie de banque;

d'effets

que

la

monnaie de banque,

en

en

reduction

si

monnaie banco;
la plus

partie

pratique

montant

ne depassa pas

total

meme

fiat

dans

la

Banque de change de Rotterdam

des comptes en monnaie de banque

montant de

le

cependant

fit

importante des comptes courants

periode de prosperite de la
le

pa\'ement

le

pouvait obtenir cette

il

la

tenue en monnaie courante; aussi arriva-t-il

que

I'ayant-compte

en vue des prescriptions concernant

le desirait

egalement

comptes courants en monnaie courante;

fl.

50,000.

La Banque de change de Middelbourg

alia

encore beaucoup

plus loin a ce point de vue; elle se montra non seulement

disposee a tenir des comptes en monnaie courante a cote de

ceux qui etaient tenus en monnaie de banque, mais

se declara

sur des

meme

gages en obligations de

Walcheren ou de
actions de la

elle

publiquement prete a avancer de I'argent

la

Zelande,

de

de

I'lle

de Middelbourg, ou bien sur des

la ville

Compagnie des Indes

orientales.

La Banque

exigeait pour ces avances un interet de 1/4 ou de 1/2 p.

au-dessus du taux

de capitalisation de

La Banque de change de Middelbourg

une operation ordinaire

et

de change d'Amsterdam,
faute

susceptible

vabilite.

Le

fait

du

paj's.

done comme

courante ce qui, pour la Banque

etait

considere

de compromettre

que

la rente

traitait

c.

le credit

comme une grande

la confiance

en sa

sol-

de la Banque de change de


Middelbourg n'en

208

souffrit guere, doit

en monnaie courante

comptes courants

et qu'il etait toujours pret

monnaie en compte

cette

aussi

bien

qu'a

delbourg

delbourg

solvabilite.

Un

fait

lieu tres re-

ses

ayant-compte

la

La Banque de change de Mid-

done organisee deja sur un pied bien plus

etait

moderne que

Ce

Banque de change de Mid-

fournissait journellement

preuve de sa

a recevoir
payer.

la

paiement en monnaie courante avait toujours

gulierement, de sorte que la

que

etre attribue a ce

cet etablissement tenait principalement des

celle d' Amsterdam.

Banque

bien plus remarquable encore fut que la

de change de Rotterdam, aussi bien que

celle

de Middel-

bourg, suspendirent leurs payements a plusieurs reprises,

et qu'elles

ne perdirent cependant jamais, dans une mesure

serieuse, la confiance dont elles jouissaient, pas

de suspension des payements;

les periodes

de

meme

celle-ci,

de

la

meme

n'en

il

dans
pas

fut

Banque de change d'Amsterdam, bien que

en raison de son organisation speciale,

pas

n'ait

suspendu ses payements avant 1790.

II

arriva aussi que la direction de la

de Rotterdam abusa une

fies.

II

parait

Rotterdam

le

que

la

fois

Banque de change

des fonds qui

municipality avait

commerce de

la toile,

lui furent

voulu

con-

attirer

d'Osnabriick, dont on confectionnait les sacs a argent,

il

semble que pour atteindre ce but

du tresor de

la

Banque.

II

s'ensuivit

specialement de celle

elle

et

employa du metal

que

la

Banque

ren-

moment donne, et on se disait

meme ironiquement que la Banque n'avait plus pour ses ayantcontra des difficultes a un

compte une encaisse

d'argent, mais bien des sacs a argent.

cote de I'exemple d'Amsterdam, celui-ci est egalement

instructif: I'affaire fut

Banque

cependant bien vite arrangee

ne perdit point la confiance du public.

et

la

209

La malheureuse annee de guerre de 1672 mit aussi la

Banque de change de Middelbourg dans une situation fort
Elle ne put satisfaire

difficile.

dues d'especes,
etre

restee

aux

elle fut obligee

demandes

inatten-

de fermer. Elle parait alors

En

pendant quelques annees.

inactive

de nouveau arrangee

I'affaire fut

fortes

1681,

Banque con-

et depuis la

nut une nouvelle periode de prosperite.

Lors de
fois

la revolution

de 1794,

la

Banque dut une nouvelle

suspendre ses paiements, probablement parce

que ceux-ci avaient

avait trop avance d'argent sur titres et

sensiblement baisse.

En

802, un nouvel arrangement

prepare qui n'entra en vigueur qu'en decembre

qu'il eut ete

publiquement declare que toutes

creances a charge de
pletement.
alors

ses

la

banque avaient

operations le

anciennes

les

ete liquidees

banque

soit

II

comreprit

806 pour suspendre ses

au debut de

1" octobre 1830.

le

fiance en la

6 Janvier

fois

fut

805 apres

La Banque de change de Middelbourg

paiements encore une

Belgique,

qu'elle

est

guerre avec

la

la

curieux que la con-

demeuree neanmoins

intacte;

les

ayant-compte pouvaient recevoir un quart de leur avoir en

especes, pour les autres trois quarts on ne pouvait exclusi-

vement disposer que par

nouveau

une

transfert. Ici

monnaie banco

confiance

restant

que Ton conservait en

Banque

1831, la

laquelle

forcee,

cependant qu' a peine au dessous du

fut rouverte sur

la

se forma done

il

delbourg

etait responsable; elle

riode de prosperite.

Avec

ne tomba

a cause de la

pair,

Banque. Le 9

I'ancienne

un etablissement communal dont

a connu

avril

tout

base,

en

de Mid-

la ville

une nouvelle pe-

sa sphere d'activite modifiee, la

Banque de change de Middelbourg vecut jusqu'au

1878.

de

'

juillet

cette date elle fut volontairement dissoute.

La Banque de change de Rotterdam

n'a jamais ete dis-


soute.

Apres

la confiance

de

la chute

210

la

Banque de changed'Amsterdam,

en la monnaie de banque fut tellement ebranlee

ne I'accordait plus davantage a

qu'on

de

celle

la

Banque

de change de Rotterdam. Celle-ci resta alors un agent-caissier

ou banque

de depots pour

mais

presque plus

n'eut

la

qui existaient.

agents-caissiers

d'ayant-compte

etait deja

monnaie courante

raison

d'etre,

En

ordinaire,

a cote des autres

I'annee 1800, le

descendu a

2,

nombre

principalement des

agents-caissiers qui voulaient placer leur caisse en lieu sur

sous la surveillance de la municipalite. Les soldes devenaient

de

en

plus

plus

troubles 1808

1810,

que leur argent

quand plusieurs

serait plus

ayant-compte ne

On

En

1812, I'avoir total des

s'elevait plus qu'a 108,000 florins, et, sans

s'eteignit

comme une

directeurs n'oiit jamais

que

et

Banque de change

chandelle.

peut declarer a I'honneur de la Banque de change de

Rotterdam, aussi bien que de

furent

annees de

particuliers trouverent

qu'elle eut ete officiellement dissoute, la

de Rotterdam

les

en securite dans I'etablissement

que chez eux-memes.

municipal

pendant

insignifiants, sauf

les

celle

de Middelbourg, que

les

commis de malversation quelconque

deconfitures temporaires de ces etablissements

exclusivement dues a une politique moins prudente

ou a des avances que Ton avait cru devoir accorder dans

un

interet public.

Nous avons expose

ces details historiques sur les

de change de Rotterdam

davantage

et

de Middelbourg pour

la situation tres speciale

d' Amsterdam;

I'organisation

ment ne pouvait

de

la

Banques
eclaircir

Banque de change

rudimentaire de cet etablisse-

etre attribuee a I'ignorance d'une politique

de banque plus moderne.

Le

droit

du change

etait

deja amplement et exactement

arrete depuis longtemps par des ordonnances et

un commerce

211

Amsterdam

considerable en effets avait pu se developper a

La

visite

de

bourse

la

etait deja

devenue une habitude cou-

merae une obligation du commer^ant (Wagenaar

rante, voire
le dit

dans son Histoire

point

qu'il

d' Amsterdam,

faute de paiement, avant I'echeance,

d'etat

s'il

I'acceptant s'absentait

si

publiquement considere

etait

comme

hors

de payer.
est

11

et

542), a tel

p.

d'usage, en 1716, de protester un effet,

devint

de la bourse

IV,

t.

de

fait

que

la

Ban que de change

d' Amsterdam

devait son importance et sa signification specialement a ce

une monnaie

qu'elle persistait a tenir ses comptes-courants en

qui

n'avait

plus

cours

et

cette

circonstance que cette

monnaie avait acquis une reputation de grande

C'est ainsi
et

que Wagenaar declarait que

specialement ceux qui etaient

terre,

tires

en Espagne, au Portugal, en

dans d'autres

villes

la plupart

stabilite.

des

effets,

en France, en Angle-

Italic,

de TAUemagne, dans

Hambourg
Nord

le

et

et

aux

bords de la Baltique, furent toujours payes en monnaie de

banque. (Voir egalement Le Long.)

Cette
etait

une

de la

stabilite

fiction

de

valeur

la

monnaie de banque

car non seulement I'argent courant devait

journellement etre reduit en monnaie de banque d'apres un

cours variant continuellement, d'ou absence deja de

mais en outre,

la

monnaie de banque elle-meme

mise a des changements de cours.

S'il

avait, a

stabilite,

etait sou-

un moment

donne, beaucoup de demandes en monnaie de banque pour

le

payement

d'autres

d'effets,

epoques,

par

cette

monnaie banco

contre,

en monnaie de banque sous

la

il

la

Banque

achetait

avait beaucoup d'offres

forme de reQus representant

des avoir en compte-courant, ce qui

de

etait chere;

faisait

que

la direction

souvent sa monnaie de banque au

marche, surtout apres 1750, pour ne pas laisser

I'agio baisser


de

fa^on

212

excessive. C'est pour ces raisons que nous trou-

vons des differences dans

de

I'agio

monnaie de banque

la

variant entre 3 et 6 p. c, a une epoque ou la confiance en

Banque de change

la

d' Amsterdam etait encore absolument

Le Long nous donne meme une table d'agiospour

intacte.

reduire la monnaie de banque en monnaie de caisse" allant

de 1/20

et

de 1/16 a 6

p. c. II dit

parfois de 1/8 ou de 1/16 entre

qui avait ete conclue

Le

que

fait

le

meme

que cet agio

une transaction

une autre

jour.

monnaie de banque

la

et

so maintint

temps devint d'autant plus remarquable que I'usage

de plus en plus (pour des motifs

ete tire en

de

I'agio

dans

meme

parfois

s'etablit

Le paiement en

quand

monnaie banco; on augmentait

long-

I'effet

alors le

avait

montant

pour obtenir I'equivalent en monnaie courante.

Bien que Ton put

considere

se faisait

si

de payer aussi

d'utilite)

des effets en monnaie courante ordinaire.

monnaie courante

differait

comme

les livres

de

ainsi encourir la

peine que

I'effet

put etre

etant indument paye et qu'une inscription

la

Banque de change seulement put compter

comme preuve que I'effet avait

ete

dument paye, nous ne

trou-

vons pas moins dans les anciens auteurs hollandais (entre autres

Wagenaar, Le Long

et

Luzac) que les effets locaux surtout

etaient sou vent tires et aussi payes en

monnaie courante.

Etant donne que la Banque de change ne voulait pas ouvrir

de compte en monnaie courante

ordinaire,

nous voyons, au

debut, malgre I'ordonnance de defense, et plus tard publi-

quement

autorises,

les

agents-caissiers

gagner continuellement en importance.

n'y

avait

prives

De

s'etablir

1770 a 1780,

et
il

pas a Amsterdam moins de 54 agents-caissiers,

qui tenaient des comptes pour leurs commettants en monnaie

courante et sur lesquels les commettants domiciliaient leurs

traites

ou disposaient par des assignations.

Le grand nombre
quelque peu

213

d'agents-caissiers mena^ait de rendre

pour eux

illusoire

I'utilite

d'un paiement im-

mediat sans transfer! d'especes. Pour cette raison les agentscaissiers d' Amsterdam avaient,

un clearmg, de

HoUandais parvinrent a organiser un commerce

etendu de monnaie

que

et d'effets et a faire

commerciale, Amsterdam,

I'Europe, voire
dial

deja, organise

certainement tres remarquable de voir comment les

est

anciens

ville

epoque

cette

paiement en especes par une compensation.

eviter le
II

a.

sorte qu'ils surent, dans la plupart des cas,

meme

d'a

de leur premiere

grand centre financier de

le

peu pres tout

le

mouvement mon-

de ce temps, grace a une organisation aussi primitive

celle d'une simple circulation

naie qui n'avait

qu'ils n'aient

moyens

meme

plus cours.

de virements en une monII

est

apparemment jamais eprouve

necessite

la

plus modernes pour simplifier la circulation

taire

qui

pays

et

cependant deja en usage

etaient

qui

landais. J.-B.

Say

dit (Li v.

En HoUande,

il

mone-

dans d'autres

I,

chap.

XXII) absolument a
qu'ils soutinrent

d'Espagne pour assurer leur independance,

monnaie de papier, de

de

certainement pas inconnus des Hol-

n'etaient

Les HoUandais, pendant la guerre

le roi

curieux de constater

cuir et

tort

contre

firent

de

la

de beaucoup d'autres matieres".

n'y eut jamais en circulation

de monnaie-

papier proprement dite ou de billets de banque, avant que

la

Banque neerlandaise commencjat, en

ses billets de banque, en sa qualite

Nous exceptons, bien entendu,

de

la

1814, remission de

de banque de

circulation.

les assign ats fran(;ais qui, lors

domination fran^aise, furent importes chez nous mais qui

ne purent jamais obtenir, dans ce pays,

Longtemps encore apres 1814 on

paiement

les

Je papier",

billets

de

la

Banque

le droit d'assimilation.

hesitait a accepter

en

neerlandaise, ces ..fiches


En

quelques occasions,

214

et

par exception seulement, pen-

dant la guerre espagnole, entre autres pendant

Leyde

et le siege

d'Harlem,

des

villes assiegees,

billets

il

fut

siege de

le

mis en circulation, dans

ou de

la

les

monnaie obsidionale au-

dessus de sa valeur, mais cette monnaie fiduciaire fut toujours

retiree

On

de

la circulation

immediatement apres

singuliers dans cette circonstance

la

Banque de change

temps

la levee

du

siege.

devra probablement chercher I'explication de ces

le caract^re

d'

que

Amsterdam

de monnaie

la

faits

monnaie banco de

avait pris au cours des

fiduciaire, bien

que de par

sa

nature elle dut precisement etre le contraire et qu'elle

le

fut,

en

effet,

au debut. Inconsciemment

le

mouvement

commercial qui se developpait constamment

sentit le besoin

imperieux d'une

que Ton ne se

telle

monnaie.

II

est

vrai

rendait pas compte de ce besoin et qu'on croyait toujours,

en effectuant des paiements en monnaie de banque, regler

une transaction commerciale en metal

effectif,

ne fut-ce

que par I'entremise d'un agent-caissier municipal. En

sence complete de monnaie fiduciaire proprement

commerce

I'ab-

dite, le

se contentait dans la pratique de ce qu'il pouvait

obtenir en son lieu et place, et c'est ainsi que pendant pres

de deux

siecles des

commercjants, qui ont

fait

preuve de

larges connaissances commerciales et d'ingeniosite dans la

gestion

de leurs

affaires,

reglerent leurs transactions com-

merciales en une matiere dont

veritable caractere

ils

ne comprirent jamais

le

(1).

Montesquieu a mieux compris ce caractere en ecrivant:

(1)
Dans les Etats qui font le commerce d'economie, on a heureusement fitabli des banques qui, par leur credit, ont forme de
nouveaux signes de valeur". {L'Esprit des Lois, t. II, liv. XX,
chap. X.). Montesquieu a ete fortement combattu sur cette these,
surtout par des ecrivaius hollandais de ce temps (v. Luzac, III.
p. 384).

215

D'apres leur conviction intime, leur systeme monetaire et

de credit

reste

etait

a peu pres ce qu'il etait au

moyen

age; en realite, la pression inevitable des circonstances et

du developpement du mouvement avait deja pousse

merce dans de nouvelles voies

ouvert

et

la

le

com-

route a une

nouvelle reglementation de la monnaie et du credit, questions

qui ne furent completement resolues qu'au siecle sui-

vant et par lesquelles

une evolution

le

mouvement mondial s'engagea dans

imposante.

si

Nous n'avons pu donner, en

rapides,

qu'un

speciale que la

dam, ont eue

apercju

superficiel

HoUande,

comme

citant ces quelques

et

de

la

donnees

signification

tres

specialement la ville d'Amster-

centre financier dans le

mouvement

mondial des temps passes. Dans un chapitre suivant, nous

tacherons d'exposer la signification

monde

financier de nos jours.

d'Amsterdam dans

le