The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1901-03-10
DOLLARS AND SMALL CHANGE
TT COSTS TO CARRY A DE-
POST IN A NATIVE BANK.
Commercial Interests VIII Soon Lead
to a Native for Improved
Facilities for Travel.
rorresnnnnence Of the -IndInnanolis 1onrnal.

than is the upset OF the present office
holding class. Scientific treatment Of both
subjects have made accessible an under
standing of their shortcomings, perhaps
without leaving concrete impressions OF
what may befall one doing business or hav-
ing occasion to travel in China. One simply
cannot use his own money without paying
heavy toll on it going and coming. While
the native system gets the blame for this
condition. the fact is that the system is
one Of first principles and capable of easy
adjustment, for it is based directly on the
value of bullion. Dollars make the mud
die and they are of foreign Introduction
and growth. Therefore, it will be desirable
TO remove notes during the process of ex-
tracing beams.
Ten kinds of dollars find currency. The
banks established avowedly for the bene-
fit of foreign trade would probably like it
we'll enough If the number were doubled,
for when localities employing a different
mintage meet, trade always involves dis
counts both ways and bank tolls are never
light. If one wishes to trade where he re-
sides, the number of dollars that will en-
able him to complete the transaction may
be insufficient if he waits to think IL over;
VI IL an 1tOSCS al OnCc IA IldN Hnu the
next day that by waiting over night a less
number of dollars would nave represented
the same value. One bows as a matter of
course to the exactions of that puzzle
known as exchange. but when it subjects
him TO a discount of 6 or I per cent. on per-
fectly good money, he concludes. that it is
time to increase profits or to buy bank
stock. That is what happens with letters
of credit and bills of exchange.
They must be turned into taels,
with a commission off, and as
tael accounts are not generally kept, an
other commission must be paid for comput-
ing them to dollars.
a foreign bank in China is so keen for
commissions that it has no hesitancy in dis
crediting itself 10 get them. One expert
ence will illustrate this point. An English
visitor came to Shanghai last May and de-
posted a draft for ESQ. equivalent to some
thing less than 1850 Mexican dollars. 1t
suffered from the usual vagaries of the
abacus, and in June, when he wished to
transfer it to a branch of the same bank at
Tien-Tsin, it had dwindled about Z per
cent. through no expenditure of his own,
the bank having enjoyed it's use for S-per-
cent. loans meanwhile. He informed the
Tien-Tsin branch that he would probably
draw very lightly against it for several
months, thus virtually advising the bank
that Ii was a safe account to let out. He
withdrew $500. and did not touch the ac-
count again until November. when he de-
cided to return TO Shanghai. He had a bal
ance of $500 at Tien-Tsin. and in order TO
have that account transferred back to the
banks branch here he had to pay the Tien-
Tsin branch 4 per cent, or $500. The privi-
lege of keeping on continuous deposit for
six months e600 in two branches of the
same bank cost him ELS, or about $50 Mex
lean dollars.
Had the depositor left his money in
Shanghai he could not have disposed of
drafts on the account without a large dis
count, and as he did not know but that he
might eventually have use in the north for
all of the deposit, he saw no other way to
keep money near linn. Even If he had OBJ
tanned Mexican dollars here for his deposit
he would have needed a small packing case
and a cart to carry the load. Mexican dol
lars were accepted at Tien-Tsin in the sum-
mer only at a discount, although usually
that is the one coin which passes at all the
treaty ports. When he made his Tien-Tsin
NNPONNN an OO0Ao 10 "a OIiy Tia uStQ
in the north, which suffer from 5 to 10 per
cent discount if presented for aymen
anywhere else.
REFORM is PROBABLE.
No computation is possible of profits re-
sulting from exchanges in different
branches of the same banks. The case
cited Is perhaps exceptional, for the de-
position was uncertain as to his plans and
had to take such punishment as the bank
to which he fell victim chose to inflict: but
business houses which have branches well
scattered must put up with high charges
for all sorts of accommodation. Consider
ing the impetus TO foreign trade which set
tied conditions will furnish it is not unlikely
that the banks will assent to the establish
ment of a uniform currency and TO such
other fiscal reform as will make their own
methods less provocative of general COM
plant. Meanwhile their dividend and sur
plus accounts may safely be relied on to
show that they suffer no hardship from do
ing business in a land several centuries be-
hind the times. 1t need not be thought that
the foreign business houses would do with
put the banks in spite of the extortions.
They serve commercial convenience in
many ways. Strides that trade has made
in the last twenty years are largely due to
the facilities the banks have been able to
extend.
The frailty that minimizes benefits and
magnifes mishaps no doubt accounts for
the phrase commonly heard here among
the foreigners that they are done In the
eye in everything relating to money. 1t
would never be supposed from the style
of life in the foreign settlements that the
process worked discomfort. Some one has
said that life here is much like that In
London. only more comfortable and with
blue sky most OF the year. a remark not
devoid of point or truth. What the bust
ness house loses to the bank 1t makes up
from its customers. the native merchants,
who in addition to paying that bill must
give their own bankers, who arrange their
credits or stand behind them otherwise. at
the yearly rate of from 20 to 10 per cent.
for that service. II the native merchants
are to continue in business they must make
profits out Of their customers. n that
is where the eye doing at last falls. Bur-
dams can ba 40 widely dfnfrfbufo6 nwonw