15<S PAPER MONRV AND COLD EXCHANGE. 



tion of meat and ])read, all })rices had risen enormously. The 

 British Government, too. in deciding on the occupation of the 

 Cape in 1795 to prevent it falling- into the hands of the French, 

 was influenced by the dissatisfaction which had been caused 

 there by the Dutch East India Company's issue of paper in pay- 

 ment of their debts. In 1792 the Burghers had almost gone into 

 revolt as a result of this grievance. When General Craig ar- 

 rived at the Cape he re]:)orted that little s])ecie was in circulation : 

 paper money " might be procured at the rate of two for one of 

 hard cash.'' This seems to be an exaggeration. The real de- 

 preciation, in terms of silver, at this time was probably about 

 twenty per cent., the figure mentioned by General Clarke in 

 October, 1795, though the quantity of silver paid out by the Brit- 

 ish might have had some influence in equalising values. This in- 

 troduces the difficulty that in considering the fall in the vali;e of 

 the dollar at the Cape we have to' deal with its depreciation in 

 terms of commodities, of bills of exchange, and of silver which 

 was then standard money all over the world. The depreciation 

 measured in terms of any one of these need not be the same 

 as the depreciation measured in terms of the others. Thus 

 there is to-day no depreciation of the British coinage in terms 

 of specie. But, owing to the excess of imports from America, 

 it is depreciated in terms of bills of exchange. We shall see 

 that in the later days of the cartoon, or paper, rixdollar, many 

 held that its depreciation was solely an external de])reciation. 

 Again, the ])renu"um on s])ecie is not an exact measure of the 

 rise in ]3rices. 



When the British forces landed in 1795, attem])ts were 

 made to obtain the good-will of the Dutch by showing that the 

 English would maintain the value of the i)aper money, while 

 the French could only e.xchange one pai)er for another. The 

 commanders ])roiuisecl that the\- would recommend the British 

 Government to use the property of the Dutch East India Com- 

 pany, of which a considerable ])art was detained in England, 

 to lic|uidate the claims of holders. Tlicir advice, however, was 

 not acted upon. The Dutch Commander, Ciovernor Sluysken. 

 was fully aware of the dangerous condition of the paper cur- 

 rency, and was able to obtain the inclusion in the Articles of 

 Ca])itulation of an agreemeiU that 



the Lands ;iiul . Ilousos, tlir i)nii)(.rt.\- of tlic Dutch East IncUa 

 Company in this settlement, sliall continue the security of that part of 

 the mone.\- which is not already secured by Mort^at;e< upon the Estates 

 of individuals hy its having been lent to them. 



The zeal of the (iovernor is shown by the use of "contintie." 

 for the notes had not been secured by anything btit the good 

 faith of the Dutch Company. 



The arrival of the British forces at the Cape had an im- 

 portant etfect on the vahie of ])a])er money. The demand for 

 local products was greatly increased. A year after the occu- 

 pation, ( ieneral Craig re])()rted that the constimi)tion of meat 



