It might be asked that, if such is the case, what part could exchange play in this adjustment? Under my proposed scheme, there would be no radical change in the situation so far as international exchange is concerned; China would still remain a silver standard country, dealing with the gold countries. Just as the efforts of the gold countries have always been directed towards getting as high a price as possible for their commodities as also as good a price as possible for their money, the endeavour of China should be to sell as much of her produce as possible and to obtain as much gold for her silver as possible. Neither process could go on in a straight line, and an adjustment and compromise takes place, almost unconsciously, from time to, time. So far, such compromise has not been altogether favourable to China, because she has taken a very small part in bringing it about, and the whole management has been left to the foreign countries and foreign banks. To take a common example: whenever exports begin to be active exchange goes up in a much quicker and higher ratio, than the fall in exchange, when imports are busy; and several payments of the Government on account of its liabilities always bring down the rates to the detriment of China. Now, if the Government took a hand in the regulation of exchange, the least that it could do would be to bring about an equipoise and equal advantage to China as well as the foreign countries. In European countries, the regulation of exchange takes place almost hourly. The quasi-Government banks, like the Bank of England, or the Bank of France, could always put up or down the rates, as it suits them; any action on the part of one country is always counteracted by the other, if it suits the latter. In European countries the quasi-Government banks regulate all finance, especially that of trade and exchange. As there is to be no such central bank in China, the Government or the Treasury, would have to undertake the duty of regulating international exchange. This is certainly not an innovation. In India, the Government has been doing it for a long while; and in the United States it is the Treasury, with the aid of the Federal Reserve Board, that has attended to the problem of exchange, under the operation of the new Federal Reserve Act - on the occasion of the last war.