Show CAUSED XO SURPRISE Slight Reaction In Silver Was Simply the Usual Course As was not unexpected silver reacted slightly yesterday and closed of a cent below the quotation of Tuesday Still the tendency is upward and the improvement im-provement will without doubt be continuous continu-ous The price at which smelter settlements settle-ments were made was G6J cents Brad streets takes a very hopeful view of the present situation but says the outcome Will depend almost entirely upon Japans future financial policy What that will be is very uncertain It is asserted that the government of that country will utilize util-ize the opportunity to put its currency on a gold basis On the other hand there is In well informed quarters a threat deal of confidence that Japanese financiers will not adopt a monetary policy so alien to the inrooted habits of the people of that country or sacrifice the advantageous position it now holds in regard to exchanges on India and Europe This phase of the matter is well summed up In a published interview with Mr Edward Brush of New York one of the best Informed authorities upon the subject That gentleman is quoted as saying Notwithstanding what has been said to the contrary the Japanese government does not desire to place its currency upon a gold basis neither does it bcliove that it would bo possible for China to arrange with European bankers to deplete the gold treasuries of Europe to the extent of the Indemnity which it will demand It does expect however that this gold Indemnity will be placed to the credit of Japan in tho trade centers of Europe and will be used there as a banking capital to make such purchases of silver war supplies and fitreral equipment as its necessities require re-quire The Japanese government has made during the war internal loans for 250OCOOOf yens in silver As its banking Cicdlt will bring them in only about 1 per cent interest in Europe and as its silver is costing 6 to S per cent in Japan it will certainly be to ths Interest of the Japanese government to buy as fast as can be done judiciously silver with Its gold credit to repay its internal loan The expression of English critics of the belief that Japan nil go on a gold basis Is father to their wish The en deavor of the English government to place India upon a gold basis has so far been a most dismal failure resulting in placing the exchange of India 15 to 20 per cent above exchange of China and Japan This has resulted in largely decreased eased xportaiions from India and largely increased ernortations from Japan Should Japan place her finances non a gold basis she would immediately lose this advantage and nlaco it in the hands of her principal rival China which must continue upon u silver basis The Japanese arc anoarentlv shrewd enough to see this situation and to govern them eeves thereby |