From the David Reimer Chop Marked Trade Dollar Collection , PCGS Registry Set
Extremely rare 1878-CC ( Carson City Mint ) US trade dollar with chopmarks .
It is ironic that after centuries of dependence upon foreign silver coins for trade , finance and commerce , when China began minting its own silver coinage in 1889 , the Chinese still looked to a foreign standard silver coin . Gullberg writes , “ The chaos of dealing with dragon dollars — each had its own weight and fineness — convinced banks to adapt an internationally acceptable coinage .” Beginning in 1895 , that coin was the British trade dollar .
Struck from 1895 to 1935 , the British trade dollar was produced at the mints in Bombay and Calcutta , and for a few years in London . It was legal tender in Hong Kong where it was illegal to chop the “ standing man ” coin , as the Chinese called it . However , it was chopped throughout mainland China . It also circulated in the Straits Settlements and elsewhere . In total , over 270 million of them were minted . The British trade dollar was supported by banks and other commercial entities which sent silver bullion to Bombay , Calcutta and London to pay for its production .
Different factors contributed to its success . The year 1897 saw the end of the Mexican Eagle dollar ’ s primacy in China , for its design was changed and the Chinese avoided it . That same year saw Japan go on the gold standard and end mintage of its silver yen coin , which had served as a trade dollar in Hong Kong and China . Japan had struck its own trade dollar from 1875 – 1877 . The Saigon dollar , which the French produced as a trade coin starting in 1885 , ended its run in 1903 ; it had circulated widely in Hong Kong and China .
The successful US trade dollar had ended in 1878 . Thus , the British trade dollar had become the standard silver coin , as did the earlier Carolus dollar , Eagle dollar and US trade dollar .
The Silver Purchase Act of 1934
In 1934 , pressure from mining interests in Nevada and California resulted in the United States passing the Silver Purchase Act . This involved purchasing huge amounts of silver on the open market . This policy resulted in the price of silver rising steadily , which made economic conditions in China problematic . American government actions caused volatility in the bullion markets and — contrary to views that a rise in silver would benefit China — it caused serious concerns . In 1934 , over $ 250 million worth of silver specie was exported from China ; Hong Kong also saw great quantities of silver currency depart .
Chinese banks had reduced cover for their note issue and rumors spread that the Chinese government was considering devaluation of silver dollars . The United States continued its silver purchase policy into 1935 , which caused further financial and currency problems for China . The Chinese government announced in November 1935 that it was abandoning the silver standard . Silver specie in circulation was to be placed under strict government control , and dollar coins replaced by an inconvertible note issued by the central bank . The Annual Report of the Royal Mint wrote of this change in monetary policy as “ an
act of statesmanship which is all the more remarkable in view of the age-long traditions which for centuries have kept that great Empire in bonds as close as those of Holy Matrimony with silver .”
December 1935 saw Hong Kong end its silver standard in a similar manner to that of China . Production of the British trade dollar ceased in 1935 , marking the end of the rich , long history of international silver coins in the China trade .
Eric Brothers has been a frequent contributor to The Numismatist , the publication of the American Numismatic Association ( ANA ), since 2006 . Several of his articles have covered financial history , including “ Alexander Hamilton and the Panic of 1792 ” ( January 2021 ). Brothers recently began contributing articles to ANS Magazine , a publication of the American Numismatic Society in New York . This is his third article for Financial History .
Brothers , Eric . “ The United States Trade Dollar : A Rousing Success Story .” The Numismatist . February 2022 .
Clancy , Kevin . “ The Story of the British Trade Dollar .” Coin Collector . December 1 , 2020 .
Ding , Chiang Hai . “ The Origins of the Malaysian Currency System ( 1867 – 1906 ).” Journal of the Malaysian Branch of the Royal Asiatic Society . Vol . 39 , No . 1 ( 209 ), pp . 1 – 18 . July 1966 .
Fetter , Frank Whitson and Herbert M . Bratter . “ China and the Flow of Silver .” Geographical Review . Vol . 26 , No . 1 , pp . 32 – 47 . January 1936 .
Gullberg , Colin James . Chopmarked Coins : A History ; The Silver Coins Used in China 1600 – 1935 . iAsure Group JEAN Publications . China . June 2014 .
Irigoin , Alejandra . “ A Trojan Horse in Daoguang China ? Explaining the Flows of Silver in and Out of China .” Working Papers No . 173 / 13 . Department of Economic History , London School of Economics . January 2013 .
Rose , F . M . Chopmarks . Numismatics International : Dallas , Texas . 1987 .
Von Glahn , Richard . “ The Changing Significance of Latin American Silver in the Chinese Economy , 16th – 19th Centuries .” Journal of Iberian and Latin American Economic History , Vol . 38 , No . 3 , pp . 553 – 585 . Universidad Carlos III de Madrid . 2019 .
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