" JL PAM, chiha THE CURRENCY OP CHINA, (A SHORT ENQUIRY.) BY JAMES K. MORRISON. LONDON : EFFINGHAM WILSON, ROYAL EXCHANGE. HONG KONG and SHANGHAI : KELLY & WALSH, LIMITED. 1895. Price One Shilling. THE CURRENCY OF CHINA. (A SHORT ENQUIRY.) BY JAMES K. MORRISON. LONDON : EFFINGHAM WILSON, ROYAL EXCHANGE. HONG KONG and SHANGHAI : KELLY & WALSH, LIMITED.] 1895. PREFACE. This small book professes no literary merit, and it is hoped any failure in that respect 'will be pardoned. It is written from notes made during some years of practical experience with the money it attempts to describe, and is put before the public with the hope that it may be of some practical assistance to those interested in the subject. ls< January, 1895. ®bc Current!) of China; O Go O INTRODUCTORY. The war which China is engaged in has brought her more prominently before this country than she has been for many years, especially so to the investing part of the public who have recently come forward to her assistance by lending her money. Many of these lenders have little more knowledge of the system of currency in the country to which they are giving their money than they have of the risks (if any) they incur from exchange, to say nothing of war. It is proposed to give the reader some definite information about the measure of value as it pre- vails in certain important parts of China. To enter thoroughly into the subject in an essay of this description would be impossible, as will be readily understood when the vast extent of coun- try comprising the Empire of China is considered, and the fact that the variations and peculiarities of the currency of China are as numerous as the dialects spoken. To the majority of people when the currency of a country is referred to, it is taken to mean lawful money consisting of coin or notes, or both. When, however, the money is neither coin nor notes, 6 things appear somewhat out of the ordinary, and to smack of barbarism and barter. The rupee and the Mexican dollar are fairly well- known coins, but who has ever seen a tael ? The tael is nevertheless the measure of value in the Empire of China, while at the same time no actual coin called a tael exists. Mexican dollars, it is true, pass current in many parts of China, but they are valued in taels either by weight or by count, and further, they are foreign coins. The question then comes, What is a tael ? The usual answer is, “ It is a certain weight of silver, called ‘ Sycee,’ moulded in the shape of a Chinese woman’s shoe.” This, however true, so far as it goes, is not sufficient, and on endeavouring to go further into the matter it is astonishing the difficulty one ex- periences, even in China, in getting anything like a clear or satisfactory answer to the question. No doubt this is owing to the fact that the tael is not an actual coin, and also by reason of the difficulty experienced by foreigners in mastering the Chinese language, necessitating the employment of Com- pradores or Head Chinamen as intermediaries. The question, however, can be answered and the monetary system of China fairly well explained and understood if a little trouble he taken. Like many other things Chinese, a certain amount of mystery hangs about it, the greatest mystery of all being how such a barbarous system could have existed so long. THE CURRENCY OF CHINA. CHAPTER I. The Chinese subdivide the tael as follows : — 10 Cash ... = 1 Candareen. 10 Candareens = 1 Mace. 10 Mace ... = 1 Tael. In commercial dealings among foreigners the tael is subdivided into mace and candareens, but its fractional parts are often simply written deci- mally, and designated cents of a tael. As there is no tael coin, neither are there any coins called mace and candareen. The only coin actually belonging to and current all over China is the well-known cash, a round coin with a square hole. It is supposed to be made of copper, but is so debased by iron, sand, &e., that instead of 1,000 cash being equal to one tael, it takes say 1,350, the ratio varying from time to time. The Chinese claim to have had a coinage even prior to the Greeks. Whether this is true or not is doubtful. It would, however, appear that they really had a coinage — of sorts — a few years prior to the Christian era, which is 8 good enough so far as time goes. During all this lapse of years the description of the coinage seems to have changed from all kinds of fantastic shapes and sizes made of gold, silver, copper, and iron, down to the present cash. All of these coins in their turn suffered and died through the prevailing disease in China — corruption — with the exception of the miserable cash of the present day, and even it is not spared by the “ sweaters ” and debasers of the Flowery Land. The subsidiary silver coins of a dollar now being coined at a Chinese mint, erected in Canton by the Viceroy of the Kwangtung Province cannot — at least at present — he called coin of the Empire of China, whatever they may he in the future. The only other coins which are used in China Proper are the Carolus Dollar, seldom now used in dealings between foreigners and Chinese. Its full weight may be taken as 413'76 grains troy, and its touch or fineness as *896. It commands a very high premium over its intrinsic worth. In the early days of Shanghai as a trading port, the Carolus dollar was used by foreigners as the measure of value there, and as it commanded a very high pre- mium compared with the Mexican dollar — which was the measure of value in Hong Kong — the ex- change in Shanghai on Hong Kong was quoted at a discount. Foreigners afterwards adopted the 9 Chinese tael as their standard of value, but to this day hankers quote exchange in Shanghai on Hong Kong as at a discount, which is incorrect, as the currencies of these two places are now totally different, one being taels and the other dollars. The Mexican Dollar. — As a clean No. 1 dollar — that is, not chopped or defaced, is not discoloured and rings properly, is of certain dies and struck at certain mints in Mexico, and in short pleases the very fastidious and mysterious tastes of the Chinese Shroff’s — is much used in Shanghai for sending to the silk districts. Its price is quoted in Shanghai in taels per 100 dollars, and it should more correctly be looked upon at that port as a commodity rather than as a measure of value. It generally commands a premium over its in- trinsic value, and consequently avoids — except on rare occasions — the melting pot. Its fineness is supposed to be *900, hut the Chinese take it at *898. Its weight when new is about *416^ grains, but the Chinese make it to be 415*745 grains based on 1,000 dollars weighing Canton taels 717 or Chauping taels 734*925. In the British colony of Hong Kong the Mexican dollar in a chopped state is legal tender, but it is taken there by weight, at the ratio of 1,000 dollars weighing 717 Canton taels. From this it will be seen that 1,000 dollars legal tender in Hong Kong may consist of more than 1,000 dollars by count, 10 depending on the condition of the coins, whether badly chopped or not ; thej^ must not, however, be broken. At Canton, Macao (Portuguese colony), Swatow, and the Treaty Ports in Formosa, Mexican dollars are taken at the same ratio of 717 Canton taels to the 1,000 dollars; while at Amoy the ratio is 1,000 dollars weighing Amoy (or Haikwan) taels 720. It has to be remembered that in the case of Amoy the tael there is heavier than the Canton tael. The difference is usually taken by the Chinese at 2 mace 8 candereens, but it is actually more than that. Foochow and Formosa take the dollars even if broken up in pieces. Such are the only coins which can be said to pass in China Proper. Whether any practical good will result from the Canton and other mints recently erected in China, towards establishing a silver coin acceptable all over the Empire, is questionable. The issue of a coin, whether called a dollar or a tael, willingly taken by the Chinese at its intrinsic value, even at the Treaty Ports, would be a great boon not only to the Chinese, but also to foreigners. There are, however, difficulties to overcome, the greatest of these being “ Olo custom ” and distrust. The fate of the American trade dollar, which although intrinsically worth more than the Mexican dollar, is known ; it is never now seen, the Chinese would 11 not take to it, and ultimately circumstances ren- dered it advisable to re-ship all these coins back to America ; the Japanese yen has been no more successful. These coins, above suspicion or re- proach in any way, failed to ingratiate themselves into the good-will of the Chinese. Will a Chinese mint worked solely under the supervision and will of a Viceroy or other Chinese official be more successful ? It is very doubtful, and for the simple reason that the Chinese are very chary of trusting each other in such matters, to say nothing of the opposition from native bankers, melters, and others whose interest it is to keep things in their present benighted condition. The recent decision come to by the Hong Kong and Straits Governments to legalise a British dollar is a move in the right direction. It is to be hoped that its fate will be more lasting than that of the old Hong Kong dollar, which was coined at a mint established there some years ago and afterwards closed and its machinery sold to Japan. If the British Government had not then acted so foolishly, it is reasonable to believe that the old Hong Kong dollar would by this time have driven the Mexican out of the colony, if not also out of Canton and the southern Treaty Ports. Time was not given to prove its success or not, and because the management of the mint was costly, seems to have been a lame excuse for the 12 British Government to have abandoned the issue of its own coin. It is no doubt a far cry to suppose that this new British dollar will find its way into the interior of China and take the place of the Mexican dollar, yet time works wonders even with Chinese “ Olo custom,” and there is no saying how China will look at things Western when she gets her present troubles arranged. That Britain should have to depend on Mexico and Japan for the coinage of two of her principal colonies, as she has done for years, is past belief. Things are now going to be put right, and the colonies referred to have quite enough to do for their new coinage without thinking whether myste- rious China will receive it or not. 13 CHAPTER II. As things are at present the tael is the money of account and the base of all monetary transactions in China. At the Treaty Ports of Ningpo, Shanghai, Chinkiang, Wuhu, Kiugkiang, Hankow, Chefoo, Tientsin, Newchwang, and Ichang, all foreign exchanges are reckoned in taels, and it is in taels foreigners trading at these ports have to measure their losses and their gains. In dealing with this form of money one has to put up with a rude and cumbersome system totally different from what exists in other parts of the civilized world, in so far, that you have not to deal with a coin issued by a State, reliable and of known and constant weight and fineness, hut with rough ingots of silver of variable weight and fine- ness, and in no way vouched for or guaranteed by the Government of the country. To understand what a tael is, it is first neces- sary to know something about the weights in China. It is not within the scope of this paper to enter into the various Chinese weights employed for general merchandise ; it will suffice to say that they are very numerous, and that the equivalents in avoirdupois of certain of these weights are fixed 14 by treaty and adopted by the Chinese Imperial Customs. For the precious metals the tael is the universal weight used, and it is with it we have to <’o. To add to the foreigner’s difficulties, the tael weight at one Treaty Port often differs from that at another port. There are, however, two tael weights which are much used, and it may be well to give their names, their equivalents, and the purposes for which they are made use of. First, the Canton Tael. As its name implies, this tael weight belongs to the City of Canton in the Kwangtung Province. Foreigners have been longer acquainted with it than with any other tael weight, and it is met with more frequently in the different Treaty Ports in China than other weights of the same denomination. Its correct equivalent is 579'84 grains troy, and it may be taken in round numbers at 580 grains troy. Its equivalent in grammes is generally taken at 37‘58, and in Indian tolahs it is 3'221i. It is the weight used in Canton, Macao, and Hong Kong for gold and silver, and in Shanghai it is used for weighing bar silver. In the latter case the tael is taken at the fixed ratio of Canton taels 82‘78 as equal to 100 ozs. troy. This will be found to be equal to the tael being a little over 579’85 grains troy, and not far from the old way of 1,000 Canton taels being equal to 1,208 ozs. troy, which is based exactly on the tael being 579‘84 grains. 15 Second, the Chawping or Shanghai Tael Weight. This tael is in general use in Shanghai for weigh- ing sycee silver and gold, but not for bar silver. Its equivalent is 565*697 grains troy, or say in round numbers 566 grains troy, and it is taken as equal to 36*65 grammes and 3*143 tolahs. When invoicing sycee for shipment in ounces troy, the custom is to do so at the ratio of 84*85 Chauping taels as equal to 100 ozs., which makes the Chau- ping tael about 565*704 grains. The Chauping tael is the Shanghai weight tael, and must not be confused with the Shanghai currency tael, which will be explained further on. The correct equivalent of 100 taels Canton is 102*5 taels Chauping, but at times the Chinese make it Chauping taels 102*4 only, when it suits them to do so. There is another tael which it may be well here to mention, namely, the Haikwan or Customs tael. It is adopted by the Imperial customs at all Treaty Ports in a monetary sense, and it is in this tael all customs duties are paid. Its weight is supposed to be, say, 581*77 grains troy, and it is generally taken by the Chinese in relation to the Canton and Chauping taels at the following ratios : — 100*28 Canton taels — 100 Haikwan taels. 102*78 Chauping taels = 100 Haikwan taels. It will be noticed that the relative weights in 16 grains troy of these taels do not give exactly the above equivalents; custom, however, has adopted them. In a monetary sense the Haikwan tael to the Shanghai currency tael is always taken at the following fixed ratio: — 100 taels Haikwan equal 11T4 taels Shanghai currency. As the tael weight varies in different parts of China, so does the tael currency. At the Treaty Ports differences in the values of the currency taels are met with and often more than one tael is used in one port. This condition of things must remain until China establishes a civilized currency ; and also opens up the country by rail- ways, and thus bring the different provinces closer to, and more under the supervision and power of, the central Government at Pekin. To attempt to go into all these currency taels would be here unnecessary ; if possible it will serve the purpose in view if we explain the tael currency as it is found in Shanghai, the largest Treaty Port in China, and touch on various matters connected therewith. 17 CHAPTER III. The Shanghai Currency Tael. — It is first neees- sary to clearly understand that in Shanghai there is a Shanghai tael weight — generally called the Chauping tael — and there is the Shanghai tael currency. The Shanghai tael currency, as already pointed out, has no existence as a coin, yet it is the money of account. It is only a certain weight of silver, called sycee silver, of a variable fineness within certain limits, but adjusted by the addition of a premium or betterness to a fancied standard, and the product dealt with or worked out in an arbi- trary manner ruled by custom. The standard is called a fancied one because it cannot be found to be laid down by the Chinese (at all events in a definite and clear way) what the standard of fine- ness is on which they work. Before showing the calculation in figures, it may be well to say some- thing about sycee silver — the manner it is made and issued. The word sycee, we are told, is taken from “ Sai-sz,” meaning fine silk; the Chinese, however, call it “ Wan Yin,” meaning pure silver. Sycee as used in Shanghai is cast in ingots or shoes weighing about 50 taels Chauping weight. Smaller ingots are seldom seen there, although in B 18 other parts of China they are met with. The ingots are called shoes from a fancied resemblance to a Chinese woman’s shoe. In former years old sycee was met with containing gold in sufficient quantity to make it profitable to extract it or to ship the ingots to Europe. This is seldom the case now, and never so with Shanghai sycee, which is now generally made by melting down silver bars imported from Europe and America, together with Mexican dollars (generally chopped) and other coins. The melters impress on each shoe their chop or name, and also one or two characters giv- ing reference to some record as to date of casting, weight, and premium. After the shoes are cast they are inspected by the “ Rung Koo,* ” an indi- vidual who cannot be said to be appointed by or connected with the Government of China, but who is selected by the Chinese bankers and money- changers, and paid for his services by a small fee of so many cash on each shoe he inspects. This j)ersonage examines the shoes, weighs, and assays them in a rough sort of way by the touchstone — if he considers such to be necessary — and when satisfied and also pleased with the “ look see ” or * The words '“.Rung Koo ” signify “to publicly value or assay.” Foreigners in China, however, are in the habit of designating the individual (who is appointed by the native bankers) employed in the Kung Koo Choh or “ public assay establishment ” as the Kung Koo. 19 general appearance of the shoe in the way of shape, colour, and lustre, writes on each shoe in black ink in large Chinese characters its weight and the pre- mium it bears. This writing is done in a peculiar style, and it is said to be difficult to copy. The shoes of sycee are then ready to be put into cir- culation. Some Chinese bankers put their chops in red ink on the shoes, but not always. The mode of assaying followed by the Chinese seems to Western ideas rough and primitive, yet the results they arrive at are not, as a rule, very far from the actual fineness of the metal. The “ Kung Koo’s ” valuation seems often to be more a confirmation of what the melters make the fineness of the sycee to be than satisfying himself by actual assay, although at times he will bore holes through the shoes or chip bits off them, and assay them by touchstone. The melter seems to work by rule of thumb ; for instance, when he melts down foreign bar silver — the fineness of which he knows, as it is stamped on the bars, and taken by him in good faith — he adds a certain weight of chopped dollars — the fineness of which he also knows — bringing down the fineness of the mass of metal to what he considers it should be, or to the premium he wishes it to bear. The melter, being responsible for all time and his heirs after him, and having deadly penalties hanging over him, exercises great care, and fraud in this b 2 20 particular is almost unknown. The Kung Koo is also responsible, and while being careful keeps a sharp eye on the melters. So much for sycee making. The method followed for arriving at the value of the sycee in Shanghai currency is as follows : — 1st. The weight in Chauping taels of the sycee is taken. 2nd. To this is added the premium or bet- terness the sycee bears, and which is marked by the Kung Koo on each shoe. 3rd. The combined sum of weight and premium is then divided by '98, and the result is taels Shanghai currency. The calculation in figures is as follows : — Say 60 shoes of sycee weighing Chauping taels 2,992-57 Premium, averaging taels 2'707 per shoe, or say 5*43 per cent. . 162-45 Divided by -98) 3,155-02 gives 3,219-41 taels Shanghai currency. The premium — which represents the fineness of the sycee — ranges from 4 to 6 per cent., or say from 2 to 3 taels on each shoe of about 50 taels weight. The 2 per cent., as mentioned under No. 3, or the dividing by -98, may be put down as 21 “ Olo custom.” Some people consider it repre- sents cost of melting, Kung Koo’s fees, and melters’ profits. This, however, is not correct, and for the following reason : The weight of pure silver — con- tained in sycee no matter of what premium — required to equal say 1,000 taels Shanghai cur- rency is known and in a measure fixed by custom ; and as the Shanghai currency, as it now exists, is considered to be, and accepted as being, based on that proportion of pure silver and its intrinsic value thereby arrived at ; it follows, that the 2 per cent, shown in the Chinese calculation does not in any way affect or lessen the value of the currency, and consequently the melters cannot receive it. This will be more clearly seen further on. There is, however, no doubt that the melters or the native bankers, or some one else, make a very considerable profit out of the manufacture of sycee. Its actual cost of manufacture must be small, as it is only run into roughly cast ingots, and is not a coinage ; further, the conditions under which the Chinese buy bar silver from the foreign banks or other importers of it, together with the price they gene- rally pay for it— which is arrived at in a way favourable for the buyers — all point to consider- able gain. Another explanation of this 2 per cent, is, that it did not originally exist, and that it arose from the act of an impecunious Chinese viceroy who desired 22 to assist the filling of his treasury. As will be shown later on, there seems some reason for this supposition. One thing, however, is clear, and that is, that the 2 per cent. “ custom ” does not noiv in any way affect the value of the Shanghai currency, whatever it may have done in days gone by — say when it was invented. When an amount of taels currency cannot be arrived at exactly in whole shoes, the Chinese arrange the difference by cutting the required weight of sycee off a shoe. The compradores of the foreign banks generally adopt a less trouble- some way of adjusting small balances under fifty taels, by using tael notes issued by some of the foreign banks and subsidiary coins of the dollar or the Japanese yen. CHAPTER IV. Without going thoroughly into the matter, it might be interesting to consider a few points con- nected with this peculiar form of money. First, the standard of fineness of the Shanghai tael currency, and also that on which the Chinese ivork, and on which they add the premium. As the premium added to the weight of sycee varies, the Chinese must have a standard to work on. It seems impossible to get a definite answer from Chinese compradores or bankers what that standard is. One will tell you that the greatest premium sycee can bear is three taels on a shoe, or about six per cent., and as sycee of that pre- mium is pure silver I’OOO touch, the standard must be six per cent, under l - 000. Another will say sycee of six per cent, premium is equal to '998 ; and another — “standard belong hlG^, all same India standard,” the latter gentleman, being of an inquisitive disposition, no doubt picked this up from his foreign employer. Before the amateur financiers in British India closed the mints in that country a considerable quantity of Shanghai sycee was shipped to India. 24 This took place generally in the early spring, when exchange in India was so low as to touch bullion point. As this sycee was sent to the Indian mints and there assayed, melted, and run into rupees, it was possible to compare the actual quantity of pure silver found in any one shipment with the Shanghai currency tael value of that shipment, and thereby arrive at the proportion of pure silver equal to say 1,000 taels Shanghai currency. The out-turns of many such shipments of Shanghai sycee to India, spread over many years, show that 1,000 taels Shanghai currency may be taken to be equal to and contain, on an average, 916| Chauping taels’ weight of pure silver. It has, however, to be remembered that when dealing with sycee, the exactness expected of money — as we here at home know it — is not to be had ; and although actual assays of the great majority of shipments to India support the result mentioned, it must not be supposed that every consignment did. Occasionally a shipment of sycee would assay nearly as much as a half per cent., or say from three to four milliemes, worse than it was expected to do, while, on the other hand, another shipment would give the same differ- ence above the estimate. These large differences in fineness were no doubt rare, although smaller ones were not, and they may be put down to the 25 inability of the Chinese to make or define the fineness of their sycee with the exactness we are _ accustomed to when dealing with the precious metals. Foreign hankers in China, however, seem to consider that experience has shown them that they may reasonably depend on a result which will give 916f Chauping taels weight of pure silver to 1,000 Shanghai taels currency, and on that belief they base their calculations. If this is accepted as a right conclusion — and there seems no reason why it should not be, presuming provision is made for small differences — it would also appear that '916f is the standard of Shanghai sycee. This, however, it must be kept in mind, is only so in relation to the Shanghai tael currency ; and if a coin called a Shanghai tael existed, equalling in value the Shanghai currency tael, it would contain 916f parts of pure silver in 1,000 parts. To issue such a coin actually coined out of this sycee would of course be impracticable : first, because the weight and size of the coins would differ on account of the fineness of the sycee varying ; and secondly, it would have the peculiarity and disadvantage of being coined in a metal of a much higher fineness than is made use of in Western countries, and, being too soft, would not stand the tear and wear a coin would be subjected to. These objections could of course be easily removed if the Chinese 26 gave their conservative minds to the question, and a coin be struck equal in value to the tael currency as it is at present known. Assuming, then, that the standard on which the Shanghai tael currency is based is '916f, a difficulty crops up in accepting that figure as the standard on which the Chinese work their system of pre- mium. To show this clearly let us take a shipment of svcee which carried an average premium of 5‘4 per cent., and by assay in India turned out *986 touch. Now, if we take ‘916j and work the pre- mium thereon, we only get a touch of ‘966166 as against the actual fineness of ‘986 ; the difference is of course due to the 2 per cent, taken as “ cus- tom.” This, however, does not clearly get us out of the confusion. The explanation appears to be, that while the standard on which the currency is really based is ‘916§, to arrive at that on which the Chinese work their system of premium, it is neces- sary to eliminate the 2 per cent. “ custom ” from the calculation. We then arrive at ‘935374 ( i.e ., 916f ^ 98), or say ‘935|, which appears to be the working standard on which the Chinese calculate the premium. Working on this standard, if we take the highest premium sycee can bear to be 6 per cent., we arrive at a maximum fineness for Shanghai sycee of '991f, which is above the aver- age fineness of sycee as now met with, and nearly I per cent, short of being pure silver. If we desire 27 to bring it up to pure silver l’OOO touch, it will require a premium of 6’909108 per cent, (or say 6‘91 per cent.) on the standard named. It may tend to make things clearer, and also serve to further ventilate the subject, if we now endeavour to discover what the standard of sycee could originally have been. As the system of pre- mium adopted by the Chinese must have been founded on the difference between a standard and pure silver, it is evident that the present condition of the currency is not what it was when originally established. If we accept what many Chinese bankers and others state — namely, that the highest premium sycee can bear is 6 per cent., as that maximum premium brings it up to pure silver — we arrive at a standard of ’943396. Although this standard is much too high to be taken as that on which the Chinese now calculate the premium, there are many things in favour of believing that it was the standard on which the currency system of Shanghai was originally founded. If this con- clusion is right or near being so, it will be noticed that sycee, like everything else connected with coinage in China, has deteriorated very consider- ably. It is quite within the bounds of possibility that the present 2 per cent, now made in the calculation did not at first exist ; if it was invented and brought into force when the standard was ■943396, it would of course reduce the intrinsic 28 value of tlie currency tael to '924528 ; or it is possible to suppose that various “ squeezes ” were levied at different periods, gradually bringing down the first-mentioned standard to '935374, and finally the 2 per cent, deduction was made, further re- ducing the intrinsic worth of the currency tael to *916f as it is at present, but leaving the system of premium to be calculated on the previous quality at '935374. Such may have been the early history of Shanghai sycee. Leaving these old days and returning to present times, it will be noticed that the important conclu- sion arrived at is, that the Shanghai currency tael as it now exists is founded on and contains 916f parts of pure silver in 1,000 parts, or in other words, 1,000 taels Shanghai currency will contain 916f Chauping taels weight of pure silver, allowing a certain remedy, better or worse, for Chinese pecu- liarities. The other standard '935374, which may be called the working standard for sycee as a metal, is at all events important to remember, as it facili- tates the calculation of arriving at the touch in milliemes of any quantity of sycee the weight and average premium of which are known. It may be well here to mention, that the premium as given by the Chinese when taken on and added to the standard *935374, gave, as a rule, results a little under what actual assays in India showed the fine- ness of the sycee to be. 29 Second : Weight of Sgcee required to equal a Shanghai tael currency. The actual weight of sycee varies according to the premium the sycee bears. Taking the average premium Shanghai sycee bears to be 5‘38 per cent, or ‘9857, it will be found by calculation verified by actual weighings and experience that such sycee will weigh at the ratio of 930 Chauping taels weight equal to 1,000 taels Shanghai currency, and consequently, that one tael Shanghai currency will weigh 9 mace 3 candereens of silver ‘9857 fineness, and contain 9 mace 1? can- dereeus weight of pure silver. Suppose it was decided by the Chinese Govern- ment to issue a tael coin based exactly on the present Shanghai tael currency, but so made as to stand usage, we might have it weighing 1 Chauping tael or 565‘697 grains troy, of which 916| parts in 1,000 or 518‘555583 grains troy would be pure silver, and 83^ parts or 47‘141416 grains troy would be alloy. Or, to avoid the long fractions, the Chauping tael might be taken as equal to 566 grains troy ; we could then have a coin of that weight, of which '916f or ^§ths, or 518f grains, would be pure silver, and ‘83|-, or j^th, or 47 J grains, would be alloy. The small increase in weight might be looked upon as an inducement to the Chinese to put aside “ Olo custom ” and accept such a coin in place of their present cumbersome system, without 30 it running much risk of the melting pot. Of course the coin would have the disadvantage of being bulky, but the half-tael of 283 grains would not be out of the way. Although Shanghai s} r cee differs in premium or fineness, and consequently varies in weight, to a tael currency, it does so within certain limits. It is seldom seen bearing a premium of less than say 4 per cent, or more than 5f per cent . ; this would mean that the weight of such sycee to equal 1,000 taels currency would be respectively 942-31 and 926‘71 Chauping taels. Suppose sycee bearing no premium was met with, which by the way is never the case, and it was just below bearing a premium, it would require 980 Chauping taels weight of such sycee to equal 1,000 taels currency ; while if it carried a premium of 6 per cent., the weight required would be 924‘53 Chauping taels ; and taking it to the farthest extreme of 6-909108 per cent, (say 6‘91 per cent.) — which would bring it up to pure silver — the weight required to equal 1,000 taels currency would be 916f Chauping taels. In taking these equivalent weights a certain margin has to be allowed. This will show the risk in dealing with a form of money of this description so far at least as foreigners in China are concerned. The danger arises, not so much from a wrong ox- false premium being put on the shoes by the Kung 31 Koo or his certificate or writing being forged, as from the statement of the premium or its trans- lation, as given, being false, and also from the shoes being tampered with after passing the Kung Koo. Third : Similarity of fineness of the Shanghai tael currency to British Indian standard. Accepting the standard of the Shanghai tael cur- rency as '91 6f, it will he noticed that it is the same as that of British India. This similarity, while remarkable, is of great assistance to the foreign banker in China, or, more correctly, was so prior to June, 1893. As elsewhere pointed out, large shipments of sycee were formerly made from China to India, and there melted and run into rupees at the mints. So long as this was done the foreign banks in China had a reliable way of fre- quently testing by assay the extraordinary currency they have to deal with. Now things are different. By the closing of the Indian mints this safeguard is lost to the foreign bankers, and it behoves them to devise some other precautionary measure to have the sycee they handle, and which passes as cur- rency at their ports in China, periodically and properly tested. Trickery is not unknown in con- nection with sycee, and it would not he surprising if the skill displayed in China some years ago in the way of boring shoes of sycee (and dollars also) 32 and inserting lead in place of the silver abstracted still remains in that country. As it is still to be hoped that the Government— if not the present Government, then its successor — will at no distant date reconsider what has been done and re-open the mints in India for the free coinage of silver, it may be of interest to state that when sycee was shipped from Shanghai to India, its estimated out-turn at the mints was based on the following conclusions — namely, the standard or fineness of sycee in relation to the Shanghai tael currency was taken as being ’9161, and conse- quently the same as that in British India ; the weight of the Chauping tael was accepted as being 565*697 grains troy, and that of the rupee, of course, at 180 grains troy, or 1 tolah ; — the result arrived at being that sycee equivalent to 100 taels Shanghai currency would run into rupees 311 - 276 From this had to be deducted : — Mint duty and minting charges ... ... = 2*10 % Average (weight) loss in melting ... ... = *20 2*10% 7*228 Giving rupees ... 307-018 which was found to be a fairly steady and reliable estimate. From it again had to be deducted cost of freight, insurance, and sundry charges for 33 shipping and landing, which vary. As to loss in melting, it was invariably found that all such shipments of sycee suffered considerable loss in weight when melted in India. This loss varied, but one-fifth of one per cent, may be put down as a fair average allowance to make for it. If the Chauping tael is taken to weigh at the ratio of 84'85, equal to 100 ozs. troy, the result would be rupees 314'280, which is little different from that previously arrived at. In conclusion, in accepting sycee as a measure of value the exactness and reliability which Western ideas expect in money is not to be found. Its form does not in any way resemble that of a coin ; it varies in fineness and in weight, and the Govern- ment of China in no way issues it or guarantees its genuineness ; it is unwieldy in form, difficult to handle, and troublesome to check even to the extent of verifying the weight and value of a small quan- tity of it. Notwithstanding all these disadvantages, foreign banks in Shanghai have for many years found it to be fairly reliable, if not quite exact, and also that they can depend on it having a value based on 1,000 taels Shanghai currency being equal to 916f Chauping taels weight of pure silver, or within a fraction of it being so. This says much for the native bankers and melters in China, considering everything. It is, however, not always c 34 safe to trust in the future because everything has been right in the past, especially so in connection with money. With sycee as a form of money, every care should be exercised — more so now than ever. No ordinary system of checking can be exact, still certain precautions can be adopted ; for instance, by comparing the actual weight of any given quantity of sycee, as proved by the scale, with the estimated weight the sycee should weigh, bearing the average premium it is said to bear. It is not professed that such a way of checking will always detect fraud, as it is quite possible to make a shoe of sycee appear to be of a premium it is not — say by removing the silver from the inside of it and inserting an inferior metal to make it the proper weight. It is, however, a fairly good check if pro- perly carried out, and that seems all that can be done, outside the foreign banks having periodical assays made of a few shoes of the sycee current at their port, and looking well to their compradore’s security ; until at least the time arrives when the Chinese Government see their way, or are com- pelled, to put the currency of their country on a civilized basis. 35 The following equivalents will be found not far from the average rates : — 100 Kooping Taels = 109-6 Taels Shanghai currency. 100 Tientsin ,, =105 ,, ,, ,, 100 Hankow ,, = 103 ,, ,, ,, 100 Canton ,, =110-2 ,, ,, ,, In Pekin alone there are many taels ; some of them, with their average equivalents in Shanghai currency, are : — 100 Soong Kiang Taels . = say 102 Taels Shanghai currency. 100 Soong Iviang Kin Taels = ,, 103 ,, ,, 100 Shew Koong Fut ,, = ,, 107-5 ,, ,, 100 Oopo Taels . . . = ,, 112 ,, ,, All these taels and their equivalents are in their monetary sense, and not as taels weight. CHAPTER V. This chapter is added with the hope that the information contained therein may be of interest and use to some readers. Checking Shanghai Sycee. — With reference to the remarks made elsewhere a, bout checking the genuineness of sycee, the following figures may be useful as a foundation for making a table to assist the checking of Shanghai sycee. Premium — Chinese Method. Equivalent in Milliemes. : 1,000 Shanghai Taels j Currency should weigh in Chauping Taels. Nil •985874 980 4 per cent. •9728 942-31 » •9751 940-04 4* » •9775 937-79 4f „ •9798 935-56 5 •9821 983-33 5* •9845 931-11 5J „ •9868 928-91 5f „ •9891 926-71 6 •9915 924-53 6-91 „ 1-000 916-67 As to Bar Silver in Shanghai. — Bar silver for sale in Shanghai should be of a fineness 17j B., or '998. The price obtained varies slightly, but 37 generally rules from Shanghai currency taels lil'10 to 111*15 per 100 Canton taels weight. As in the case of Mexican dollars so with bar silver, a better price can be got from the Chinese for what pleases them in the shape of “look see ” — this is proved by the marked preference the Chinese have for Californian bars, which in appearance are neater cast, have a better colour, and are more regular in shape and size than other silver bars. The silver if under 172- B. will cause difficulty in disposing of it except at considerably below its relative value ; if the fineness is over 17g- B., no better price will be obtained. The price being agreed upon, the weight of the silver is taken by the Chinese buyer as marked on the bars in ounces troy, and then turned into Canton taels weight at the fixed ratio of Canton taels, 82*78 per 100 ozs. troy. This calculation will be found to make the Canton tael a little over 579*85 grains, which is slightly greater than the correct ratio of 1,000 Canton taels equal to 1,208 ozs. troy, based exactly on the Canton tael being 579*81 grains. As to the way the price paid in Shanghai is arrived at, the following seems to be the Chinese way of looking at the matter. The Canton tael weight to the Chauping tael weight is taken at the ratio of 100 of the former as equal to 102*4 of the latter ; then 93 Chauping taels weight of sycee is 38 taken as equal to 100 taels Shanghai currency, and 1 per cent, added for better fineness of the bar silver as compared with the sycee. In figures the calculation would be as follows : — 93)1,024(110-106 to which is added 1 per cent, for better fineness 1-101 111-207 giving a result better than the average price paid for bar silver in Shanghai. The calculation, however, is entirely in favour of the Chinese buyer — first, because the ratio the Canton tael is taken to the Cliauping tael should be 102'5 (not 102‘4), and, in the second place, as 93 Chauping taels weight of Shanghai sycee when taken as equal 100 taels Shanghai currency, should consist of sycee of almost ’986 fineness, it follows, that the difference between that fineness and ’998 the fineness of the bar silver is greater than the one per cent, allowed. From this it will be seen that the buyer of bar silver of not worse than 17£ B, at the price of Shanghai taels 111*15, makes a profit of at least one-third per cent., besides the advantage he gains by taking 100 ounces as equal 82'78 Canton taels, and the probable gain from making no allowance for any chance bars he may get of a little better fineness than 17j B. As to Mexican Dollars in Shanghai. — As pointed out elsewhere, the Mexican dollars used 89 in Shanghai are No. I clean dollars. The bank compradores and native bankers are most parti- cular in shroffing or examining the dollars, and reject many for bad colour, or for being yellow- faced, or chipped, or bad ring, &c. — defects which in many cases are not recognisable except to experts. These No. 1 clean dollars are bought and sold at a tael price per 100 dollars, varying from say Shanghai currency taels 72^ to 74^. The average price may be taken at 73J. At times the Chinese form rings and run the price up, but they are liable to get into trouble with the Chinese authori- ties for doing so. Chopped or defaced Mexican dollars, and dollars which do not pass as No. 1, are only saleable at what the Chinese made their melting price to be. This price varies slightly from Shanghai taels 71 '8 to 71*9 per 100 dollars, weighing 71*7 Canton taels. The melting price of these dollars is arrived at by the Chinese in the following way : — One thousand dollars are taken as weighing 717 Canton taels, which again is taken at 102 - 5 and made to equal 73 4*9 Chauping taels. The touch or fineness of the dollar is taken as being - 898 and 1,000 Shanghai taels currency of sycee 4| per cent, premium or ’980, is taken as equal to 936 Chau- ping taels weight of that sycee. 40 In figures the calculation might be stated as follows : — Taels Shanghai cur- rency (?) jhai cur- j 100 Dollars. $ 1,000 Chauping Taels 'of Touch . f 734-9 Chauping Taels of “ ( -898 Touch 936) (1,000 Taels Shanghai •980) ( currency. Ans. . . 71-94 Taels Shanghai currency. Again the Chiuese buyers scores. The calculation would be more correct if stated in this way : — Taels Shanghai cur- rency (?) . . . . $ 1,000 100 Dollars. 734-925 Chauping Taels •898 of Touch. Chauping Taels 935-56) _ (1,000 Taels Shanghai of Touch . 980 j ~ \ currency This gives Shanghai taels 71'98, and that is when the fineness of the Mexican dollar is taken at only *898 as against "900, which it is supposed to he. There are other peculiar customs in connection with Banking and Finance in China. Effingham Wilson, Printer, n, Royal Exchange, E.C.