The Peking correspondent of the Times described in the issue
of Wednesday a remarkable instance of the recklessness of the Chinese Government in borrowing money. The recent conclusion of the loan by the Five Powers group was delayed by the negotiations for a smaller loan from an Austrian group of bankers. The latter loan has fallen through for the present, but it is very instructive to know what the Chinese Government seriously proposed to do, and apparently are still prepared to do. In order to raise £1,413,000 of ready money they were prepared to make themselves liable for £3,200,000, which would have been repayable in a short time. It is true that besides the ready money they would have got twelve torpedo boats from a Trieste yard and six destroyers from a German yard, but they would have had no use for these vessels, and, of course, only agreed to buy them because the purchase was a condition of the loan. (The old- fashioned moneylenders used to give £50 in cash and the rest of the £100 in " old sherry" and pictures by and after Rubens and Van Dyck.) The German Government appears to have given wise and straightforward advice to the Vulcan Company of Stettin, and the German part of the contract was refused. But if China should persist in borrowing in this way her financial enslavement could not be postponed indefinitely.
