,
on account of being paid in the more valuable coin. The result of
the change would be that the merchant or employe would have to pay
double for what he buys, and would receive no increase for what he
sells. While trade would eventually adjust itself to the change,
yet many merchants would be ruined in the process and would drag some
banks down with them.

The Mexican dollar is the standard also in Hongkong and China, and the
whole trade of the Far East has, for generations, been conducted on a
silver basis. Japan has, within the last year, broken away from this
and established the gold standard, but in doing so the relative value
of silver and gold was fixed at 32 1/2 to 1, or about the market rate.

Public Debt.

I was unable to obtain any precise information in regard to the
colonial debt. The last book on statistics of imports and exports was
for the fiscal year 1894, and the last printed budget was for 1896-7,
which was approved by the Queen Regent in August, 1896. Subsequent to
this date, according to the statements made to me by foreign bankers,
the Cortes authorized two colonial loans of $14,000,000 (silver)
each, known as Series A and Series B. The proceeds were to be used
in suppressing the insurrection. Both were to be secured by a first
lien on the receipts of the Manila custom house.

Series A is said to have been sold in Spain and the proceeds to have
been paid into the Colonial Office; but no part of them has ever
reached the Philippines. Possibly a portion of it was used in sending
out the 25,000 troops which came from Spain to the Philippines in
the autumn of 1896.

Series B was offered for sale in Manila, but was not taken. An effort
was then made to obtain subscribers in the Provinces, but with little
or no success. The Government then notified the depositors in the
Public Savings Bank (a branch of the Treasury Department similar to the
postal savings bureaus in other countries) that their deposits would no
longer be redeemed in cash, but only in Series B bonds. Some depositors
were frightened and took bonds, others declined to do so. Then came
the blockade of Manila and all business was practically suspended.

No printed report has been made concerning the debt, and I was unable
to obtain any satisfactory statement of the matter from the treasury
officials.

The exact in regard to the Series A bonds can be learned in Madrid;
but it will be difficult to learn how many of Series B were issu