money shall be concentrated in the hands of the central government. The power of the viceroys, however, is too great to allow of their privileges being taken away abruptly and without their consent.

Fortunately for the future of China, the viceroys in several of the leading provinces are now men of ability, foresight, and patriotism, and are themselves likely to aid powerfully in giving China the benefits of a national monetary system. Through reorganization of the taxes and perhaps the payment of commissions in distributing the new money, some compensation for taking away the right of coinage can be made, which will prevent heavy loss of revenue by the viceroys in the early stages of the new system. The local bankers, who make large profits by the exchange of the silver sycee and the copper cash, might also oppose the new system if similar compensation were not made to them in the distribution of the new currency.

The attitude of the foreign banks doing business in China is an important factor

in the introduction of a new monetary system. They have made great profits during the last few years by the fluctuations in the exchange with European countries and with the United States. It might seem that the foreign bankers would hesitate to renounce these profits and would oppose the introduction of a uniform monetary system. The more the subject has been discussed, however, the more the bankers have realized that enlightened self-interest, as well as sound public policy, demands a system which will reduce the fluctuations of exchange to the usual limitations between gold countries. On the Commissions appointed to meet the Mexican and American Commissions at London, Paris, Berlin, and St. Petersburg sat representatives of the great banks doing business in the Orient-the Hongkong and Shanghai Bank for Great Britain, the Bank of IndoChina for France, the German-Asiatic Bank for Germany, and the Russo-Chinese Bank for Russia. These gentlemen all agreed that the gold standard for China

was ultimately desirable and that measures should be taken as soon as practicable to put it into effect. They appeared to be influenced by the consideration that what tended to China's industrial development would eventually benefit those who conducted her banking business.

If the new standard were to go into effect within ninety days throughout the Empire, undoubtedly losses to the banks would occur, so heavy as to cause them to hesitate from motives of self-preservation to see it established. It is clear, however, that even if difficulties give way with unexpected ease, its introduction must be gradual. Introduced probably at first in the cities of the coast, where coin is already familiar to the people, it will be extended through one coast province to another, and will then make its way into the interior, as the people there find how much more convenient are coins of uniform size and ascertained value than the silver bullion which has to be weighed and assayed every time it is used. Exchange between the cities on the coast

and the interior will continue to fluctuate, and the banks will continue to derive profits from this source and from others related to the introduction of the new system while they gradually readjust their methods to the new economic future of China which will grow out of the extension of railways, the introduction of foreign capital, and the extension of her import and export trade.

What is meant by introducing the gold standard into China deserves explanation. Upon its face the proposition appears to many persons to be impracticable. If China were to acquire a gold currency of $3 per capita, which is about one-tenth the monetary stock of the people of the United States, her population of 400,000ooo would require $1,200,000,000 of gold. This would mean a draft upon the world's gold resources equal to one-quarter of the entire existing stock. The rich nations of Europe and America would undergo a monetary crisis if such a demand were successfully made upon them; and the financial resources of China would be ut

terly incapable of making such a demand successfully upon nations so strong financially and so vitally interested in keeping their gold. In short, China could not get the gold.

How, then, is China to set up the gold standard? Can she have a gold standard without a gold circulation? If this question had been asked a generation or two ago, without the experience of other nations in recent years, it would probably have received an emphatic negative. Fortunately, however, the question has been answered in many lands under diverse conditions in a manner which justifies a decisive answer in the affirmative. British India has to-day a gold standard without a gold currency; the Netherlands have had for thirty years a gold standard without a gold currency. Belgium is in nearly the same position. France has now a considerable stock of gold, but since 1875 she has maintained at gold par several hundred millions of silver. The United States have done the same thing. Their $650,000,000 in silver, if sold in the bul