COTTON TEXTILES IN FOREIGN COUNTRIES. 167 



a fair article at a low price is demanded ; and what I have said of cot- 

 tons is equally true of woolen goods. It is a well-known fact in Aus- 

 tralia, that the blankets imported from New Zealand, as from the 

 United States, are of much better quality than those placed on the 

 market from England; but the high cost of the former kinds makes 

 the demand for them very limited. The English blankets have neither 

 the weight, finish, or quality of the American article, and while a great 

 many very mean articles of this class are sold to those who demand a 

 low priced blanket, considerable quantities, fairly good, are also sold 

 to the working classes at remunerative prices and give very general 

 satistaction, especially when their low price is considered. 



BANKING AND METHOD OF PURCHASE. 



The banking system with the United States is an important item to 

 be considered with regard to the importation of American cotton goods 

 as well as of other merchandise. 



There is no direct exchange with New York, the medium being by 

 way of London. The few banks here having facilities for the sale of 

 drafts on New York or San Francisco, payable at sight, charge from 2 

 to 5 per cent., while the exchange by way of London is only J per cent. 

 The direct transactions with New York seldom occur, and when they 

 do they are for very small amounts, the exchange, as I have said, 

 being conducted by way of London. 



The Australian merchant who has no established credit in New York 

 has either to send a bank draft along with his order for the goods he 

 desires to purchase, and thus loses the interest on his money, or else he 

 is obliged to go to his banker here and arrange for a bank credit. 

 When this is done the Australian importer orders his goods generally 

 from a New York commission merchant, who purchases them and 

 charges 2 per cent, for so doing. The colonial bank in the mean time 

 authorizes its New York agent to purchase drafts from the commission 

 merchant on the importer in these colonies for a fixed amount at the 

 current rate of exchange on London. The colonial bank's agent is in- 

 structed at the same time to see that the drafts are accompanied by 

 proper shipping documents, bills of lading, insurance policy, etc. When 

 the bank's agent is in possession of these documents, which virtually 

 amounts to the ownership of the goods, he purchases the American 

 merchant's drafts and an order is given for the shipment of the goods, 

 which may be done either direct to Australia or by way of London. 

 The agent of the colonial bank in New York then forwards the drafts, 

 bills of lading, etc., to the bank agent in London with instructions to 

 write to the bank in Australia and authorize the delivery of the goods 

 upon payment of the drafts and all other necessary expenses not in- 

 oliuled in the draft, such as the current rate of exchange between Lon- 

 don and Australia. 



