The Anaconda standard., 1898-12-03
Harden Reports on Conditions in
the Philippines.
SILVER IS THE CURRENCY
The Natives viii Take Fifty-Cent DOL
lar In Preference to an American
Dollar-Islands Must Be Kept
on O Silver Basis.

cial and Industrial conditions i'm the
Philippines. has made his report to the
secretary of the treasury, in the course
OF which he says:
silver is the basis of the currency in
the Philippines. There is no gold in
general circulation and has been none
for more than 20 years. The Mexican
dollar of a date previous TO 1877 IL cur
rent in the islands and IL Is practically
the only money In general circulation.
The Spanish government. i'm the sum-
mer of 1897, coined 5000 900 of silver in
a local currency which was sent to the
islands. These dollars are lighter In
weight than the Mexican dollars. but
the scarcity of money I'm the Philip
pine islands caused them to be quickly
absorbed. There is note issuing bank
called the Banco Filipino which has
in circulation notes based on silver. OF
which there was outstanding on Sept.
30, 1898, approximately s2,500.0 900. Pre-
vious TO 1875 the silver was often at a
premium over gold. When silver began
10 depreciate in value the gold coin was
rapidly exported and replaced by the
Mexican dollar, which has for a long
time been in general use throughout
the Orient. Gold became so scarce
through the export of gold coin and the
silver was taking it's place so rapidly
that the Spanish government took steps
the import of the other. In the spring
of 1873 an edict was issued from Madrid
prohibiting the importation Of all sill
Yer dollars bearing a date subsequent to
1877.
For the ordinary needs Of the coun-
try little money is used, as the credit
system Is in vogue throughout the ISL
ands and there is, therefore. no great
amount of money needed for the pay
ment of wages to the laboring classes.
The law which prevented the importa-
tion of the Mexican dollar of a date
subsequent TO 1877 proved a great hard
ship to business interests and would
have been a greater evil had IL not been
for the laxity Of the officials which per-
mitted and encouraged smuggling. 1t
was not uncommon for the dollar to go
to a premium of 10 or II per cent. and
this would Immediately start the flow
of silver toward the island, which
would be continued until the demand
was met and the rate of exchange was
reduced 20 a point which would cause
smuggling to cease being profitable.
The smuggling of silver into the ISL
ands was a recognized industry. 1t was
carried on largely by the rich 'mesti-
zos,' or Chinese half castles. There was a
regular system for the bringing i'm Of
these coins. The result of the Spanish
laws was to make money dear during
the season when there was big de-
mand for currency, and the producers
as well as the merchants and bankers
have been robbed from year to year
through the effects Of the law in force
The Spanish government kept no
statistics of currency or finance and
the bankers can only give estimates Of
the most general character. The most
careful estimate of the currency of the
islands is therefore likely to be incor-
rect. There are 100000 people i'm the
islands, according to the estimate Of
the Spanish government. of whom only
a small fraction live in the territory
contiguous to Manila and Iloilo. When
money once leaves these centers IL
passes out of the knowledge of bust
ness men and IL Is impossible there
fore to form any correct idea of the
amount Of money now in the islands
There is 81. 900 I'm Philippine dollars
coined by the Spanish government and
sent out a year ago. of which only a
small per centage is now in Manila.
1T Is estimated there Is in circula-
tion sio.0O00 600 Of subsidiary coins the
10-cent. 2O-cent and 50-cent pieces.
which have been recoined from Mexi-
can dollars by the Spanish government.
The estimate of the Mexican dollars
now in circulation as given by one Of
the best Informed bankers i'm the ISL
ands, is from s20. 900 900 to s25. 600 O0O
This. with the s. 500 600 of notes of the
Banco Espanol Filipino now i'm circu-
lation. constitutes the currency OF the
islands. This would make a total Of
$40 900 900 to si5. .oO0. 900 speaking roundlv
for the entire islands. or approximately
s. per capita for the total population OF
the islands. II is not to be overlooked
that these figures are given on a silver
basis and that therefore in figuring ou-
own standard all of these figures must
be "'It In two. Three banking institu-
tions do the banking business of the
islands aside from that done by the
large commercial houses which buy and
sell exchange and to a limited extent
carry on the business which legitimate
ly belongs % banking institutions.
Under the charter of the RanCo Es-
panol Filipno. II is permitted To issue
bank notes I'm an amount equal To three
times its ca nifal stock. Its present cap
ital Is $500 Goo. and its note issue may
Therefore amount TO 81 500 600 on Sept
30 there was In circulation. as previous
lv stated. approximately 81 500. 600 Of
these notes They are issued on sill
yer basis and are payable on demand
to the bearer.
''The question Of the future currency
of the island Is one which is Of vital
importance 20 all business men I'm the
islands. The best Informed men in Ma
Mia are unanimous in their opinion
that under present conditions the silver
currency Is the only one suited TO the
islands. great deal of the trade of
the Philippines is with China and
Japan and the straits settlements. In
dia and Australia. In China, Japan
and India the whole trade is on a silver
basis. though Japan has adopted the
gold dollar. which is approximately
worth only 30 cents and its currancy
therefore I'm effect Is on a silver basis
the same as China and India.
"The natives of the Philippines are
conservative To degree in the mat
ter OF their currency and II would be
a long and tedious task to educate them
to a dollar which would be worth twice
that now in circulation. notwithstand-
inc these Americans have a force ot
1900 soldiers in Manila who are paid
In gold. the people Of the islands will
have nothing but silver. All Of the SOL