TRADE CORPORATIONS IN CHINA. 725 



there are only five in Peking, have to be authorized by the Gov- 

 ernment. A religious motive may be at the bottom of this restric- 

 tion, the large cattle being reserved for the imperial sacrifices. 

 Moreover, the killing of animals has been interdicted at different 

 times, and even now the slaughter houses are ordered closed, as 

 an act of public penitence, in times of drought. 



The loan houses also need an ofticial authorization. They pay 

 a tax on their operations to the local authorities, and are divided 

 into three classes, according to the importance of their business. 

 Those of the first class receive deposits from the authorities of 

 various sums, on which they pay interest, the administration rea- 

 soning that by helping them increase their capital and enlarge 

 their business it will be doing a philanthropic work and assisting 

 the people. These loan offices are not at all like our pawnbrokers' 

 shops, but are a credit institution, to which the middle class as well 

 as the poor Chinaman has constant recourse. Being conducted on 

 equitable terms and serving their convenience in various ways, they 

 render great services to the Chinese people, and have become neces- 

 sary to their life, and this explains the departure of the Govern- 

 ment from its usual policy of non-interference to supervise and 

 favor them. China has, further, large and small capitalists, and 

 numerous credit establishments very much like ours. They may 

 be classified as exchange offices, banks, and banks of discount. The 

 last are at Peking, where they were founded a few decades ago by 

 some men from Chan-Si. Their single industry is trading notes 

 in all China and some of its dependencies. They have no monop- 

 oly, for some of the larger banks and more important traders were 

 all doing the same; but they have regulated the business, extended 

 it to more places, and have almost entirely suppressed the trans- 

 portation of money in bulk. 



The banks of exchange perform a variety of functions on a 

 restricted scale, charging two per cent for exchanges, issuing notes 

 without any supervision, and lending money at two per cent a 

 month in normal times. They are not, however, always able to 

 pay their notes at sight, and it is well, therefore, not to keep them 

 too long. In the provinces a bank usually accepts only its own 

 notes. In Peking some well-known signatures are accepted every- 

 where after examination by an expert, who places his seal on the 

 note he declares good, charges a fee for each verification, and is 

 responsible for his mistakes. 



The large banks, by accepting or refusing the notes of any 

 house or by throwing money or sapiques on the market, rule in the 

 corporation and have the whole fate of the market in their hands. 

 The four Hengs, by the amount of their reserve, the solidity of 



