The morning news. [volume] (Savannah, Ga.) 1887-1900, 1898-12-03
SILVER IN THE PHILIPPINES
THE BASIS OF CURRENCY IN AMER
ICA'S NEW POSSESSION.

MCNienn Dollars Freely Used, nnd
About S6,0OO,UOO Local silver Coin
in CircuIntion-siIVer Was often Mt
n Premium over GOId-Amount of
Money Needed Fluctuates-EdNyar
w. Hnriden's Interesting Report.
Washington, Dec. 2.-Mr Edward w.
Harden, who was appointed i'm August
last as honorary commissioner of the
United States TO make investigation Of
the financial and Industrial conditions In
the Philippine Island, has made his report
20 the Secretary Of the Treasury. in the
course of which he says:
silver is the basis of the currency in
the Philippine Islands. There Is no gold
in general circulation and has been none
for more than twenty years. The Mexi-
can dollar of a date previous to 1877, is
current in the islands and it is practically
the only money in general circulation. The
Spanish government, in the summer of
1897, coined 5000 600 of silver In a local
currency which was sent to the island.
These dollars are lighter in weight than
the Mexican dollars. but the scarcity of
money in the Philippine Islands. caused
them to be quickly absorbed. There IS
local note issuing bank called the Baaco
Sspanol Filipino, which has in circulation
notes based on silver, of which there was
outstanding on Sept. 80, 1898, approximately
$2,50O,OOO.
The currency of the islands was origi-
nally gold, in pieces of 81, 81 and ST. with
the. Mexican silver dollar and the old
Spanish silver dollars, the latter circulat.
ing 10 a limited extent only.
Previous to 1875 the silver was often at
a premium over gold. When silver began
TO depreciate in value the gold coin was
rapidly exported and replaced by the Mex
lean silver dollar, which has for a long
time been IN general use throughout the
Orient. Gold became so scarce through the
export of the gold coin, and the silver was
taking It's place so rapidly, that the Span
ish government took steps to stop the ex-
port of the one and the import of the
other. In the spring of 1878 an edlct was is
sued from Madrid prohibiting the import
of all silver dollars bearing a date subse-
quent TO 1877. This law was maintained
until the control of the islands passed 10
the United States.
THE amount of money needed for the
trade and commerce OF the Philippine Is
lands huctuates in the different seasons.
THE fiuctuaton in the demand for mon
ey In different seasons of the year resulted
in widely fiuctuating rates of exchange
and in the continued flow of money either
to or from the Islands.
THE law which prevented the importa-
tion of Mexican dollars of r date subse-
quent TO 1877 proved great hardship 20
the business interests and would have been
a much greater evil had IL not been for tne
laxity of the officials which permitted and
encouraged smuggling 1t was moi uncom-
mon for the dollar to go al premium Of
ten or twelve per cent, and this would inn
mediately start the flow of silver toward
the islands which would be continued un-
til the demand was met, and the rate OF
exchange was reduced to a point which
would cause smuggling to cease being pro-
htable
''The smuggling of silver into the ISL
ands was a recognized Industry. j was
carried on largely by the rich mestizos,
or Chinese half castles. There was a regu-
lar system for the bringing in of these
coins.
After the occupation of Manila by the
American troops permission was given the
banks to import silver freely, and the re-
suit has been to keep exchange rates on
more stable basis. The Spanish gov
ernment keeps no statistics. of currency
or finance and tie bankers can give only
estimates of the most general character.
There was s6,OO0OO0 in Philippine dol
lars coined by the Spanish government
which only small percentage
is now in Manila. II is estimated there
is in circulation sl0,O0O,OO0 Of subsidiary
coins. The estimate of the Mexican dol
lars now In circulation, as given by one
Of the best informed bankers of the ISL
and, is from 900 to S25,000000 This
with the $500 900 of notes of the Banco
Espanol Filipino now in circulation, con-
stitutes the currency Of the Islands This
would make total Of from $0.0OO,OOO &c
$45, 100000 speaking roughly for the en-
tire islands, or, approximately IS per cap
Ira for the total population of the ISL
ands. II must not be overlooked that
these figures are given on a silver basis
and that, therefore, in figuring on our owr
standard all Of these figures must be cut
In two. These banking institutions do the
banking business of the Philippine Islands
aside from that done by the large com
'mercial houses which buy and sell ex.
change, and 10 a limited extent carry on
the business which legitimately belongs &c
banking institutions or the three banks
the two most important are branch con.
Germs, the third being a local institution
controlled by Spaniards and natives.
Under the charter of the Banco Espa.
mol Filipino, II is permitted to issue bank
notes In amount equal 10 three times its
capital stock. The present capital Of the
bank Is $l,5O0,0e9 and It's noie issue may
therefore, amount to Si500,0O0.
on Sept 30, there was In circulation, as
previously stated, approximately s25O0,oOl
of these notes. These notes are issued OF
a silver basis and are payable on demand
TO bearer
1.-THE question Of the future currency ci
the island Is one which Is OF vital i'm
portance to all business men IN the is
lands The best informed men in Manila
are unanimous IN their opinion that undei
present conditions the silver currency Is
the only one suited to the islands. The
natives Of the Philippine Islands are con.
servative to degree in the
matter Of their purpQse and
IL would be a long and tediohs task tc
| .ls.fIs 4Ftf LEX. L.