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Show IlmMlW FINANCE IN JAPAN t - , By FREDERIC J. HASKN-- B (C opyriffht. 190.x.) "wiipn Japan look unto itself the LBkcsiiffrs 0I w'J,t(''' civilization it wis BKIfibvitHble that tlic cursi's must bo iii-Eclodcd. iii-Eclodcd. Today it is snlTerm;; from h:iv-Hftar h:iv-Hftar tnlccn .1 Hyor at frc'ti.iod flimnco. Blftcr tlio war "with Hitssia, tIic .lapan-K:a .lapan-K:a mbfl headlong into a boom. The Rollnpse 1ms come and tho nation is Locpin". Jt might have bom? the bur-Htdcn bur-Htdcn ("its own folly without gn.-ar trou- Pblr but the sins of Ansi-ricri aro aim Kvisitci upon Nippon, f-'or every A mum ? 1 K"..aa rirl who is pouting bt'cnusu that 'rh'nrril Wall aticot has .lopiivc-l her of I ,K, fl' n0v silk tjown. there is a sorrowful I 'Eilmond-eveil inuid in heaiitn'til Japan f'vrlio mourns the loss of the six cents a ; f iBvilnv which she earned by fce-linpr Ftlk : 'Tnrins. Among the most marked of- I jK.Pjg of the recent panie in tlu united j f ?tRlei was tin rnlli lifr off in demand for I -'IBlkHte. Consequently, the codowns of Vo-folmnni Vo-folmnni contain o0.000,00p worth of Betray,- nilk at a time, when in :i normal 5BEvcar, I hey would be empty. This silk tHfjj uneulafile at, a profit, and every time MK hale changes hands now it means 'i '.HI flic silk grower in the country did 1HffjK)t foresee the financial crash, neither Jlvliil his country banker. The grower IRjjiedcd ready nioner and the banker ad-IKviiiicCil ad-IKviiiicCil it on the security of the silk. H?Cow the price his f&llcn and the silk 'is practically unsalable. The silk grow-k grow-k mttr cannot pay ihu banker. The. banker frmiist pay his .'.ej-ositors. From these IHthinus come bank runs, from bank runs vHfecnme failures, fioni failures conies lo.s iBJrni rinplo3'mon', and from loss of ern-Br..'iyiueut ern-Br..'iyiueut pom-5 Marvation. And this Ban a country where twenty eents a day BBjU lii?i wagis (or an abl-bodicd man. 'K If there had been money in the conn- ! iBMjry thf tcmrorar." cessation of Atncri-Vjmt Atncri-Vjmt kiin purchases here would not cause fuBj' Wh 8iriou& i mbaiTausment. But .Japan 1 I lias rover hud ur.ieh money, ami what , ! l.Ittle it did have- has pone into thr j 'great industrial companies organized ! ilnring the boom which startod a few ; proonth after the eloso of the war with IJtussia and which tumbled into not h-inuiu h-inuiu with the crash of last vear. file Japanese government tried in many tnavs to restrain the fevr for speculation, specula-tion, knowing that the resources of the tntion were not, sufficient to sustain a. aIf-billion dollars' worth of new in-Jhistries in-Jhistries at this time. But the advice jras not hf-eded and speculation stopped only when the bubble burst. Now tho Cfiveriiinent seems to forget its role of friend to commercial interests and refuses re-fuses to take any steps to relieve eon- ifditious. On the other hand, the bur-Mens bur-Mens of its people are augmented by the jlcvy of new taxes, although the war tax fbas not been lessened after three years jfnf peace. And of this tax money rob alerted from these poverty-stricken poo-jJVile, poo-jJVile, 1 lie government spent last year: On Ijlie army and navy, IojTOI.GoO; ou Bi'ii uea t ion, .? 1,11 S.-l 70. k if; The war with Hussin brought to Ja-Ifiiin Ja-Ifiiin so many hallelujahs and banzais jffroin all p;'rts of I he world, that the XT.ipaiir.se were almost convinced that itlierc was nothing which they could not Tclo. It w.fi natural that they should Jliirn to industrial fields and seek to as-'ttouish as-'ttouish the world there as they had done p war. ( ompnnies were organized to jfxploil the meager mineral resources of Jilie island, others to nianufncturo raw iii.itf rials -to be brought from China, tlothors to push commerce into foreign ,laudh. Millions were .subscribed, and ilii'fore the ink wns dry on the papers j jjlof incorporation a dividend would be KuVkirod. This artful dodge deceived I i J the innocent lamb of Nippon and he rushed lo his little Wall street with his savings. The prices of shares soared to the skied. Then came the world-shaking financial finan-cial troubles. Copper, .Japan's groat-, groat-, est mineral product, dropped to the bottom. Then camu the silk disaster, and .Japan's greatest domestic industry I was jmralyzcd. The balance of trade in I I'JOO had rim in Japan's favor and its peopje boasted that their 's was an ox- porting nation. Within a few months J the exports dropped almost half. The , l'irik ot Japan pays :i twelve pff cenL ; dividend, and is considered a tnorough-; tnorough-; Jy sound institution. The par value of i its shares is 200 you. (A yen is cquiva-I cquiva-I lent to fifty cents iu American money.) , In a few mouths the market value I dropped from S20 to AGS yen. The Tokyo Electric Railway stock, par value 50 yen. dropjicd from IOC to ;!). and now municipalization of the property ! IS sight. The Osaka Spinning company com-pany has never missed a dividend and it pays twenty per cent annually. Its shares, par 50 yen, fell from J2(j" to 79, in tho face of the one-fifth dividend. Tlow foolish .the payment of such dividends is has been proved in the ery case of this sjiinning company. The Japanese cotton spinning mills, of course, use foroign raw material. Thev have excellent mills and the- have good labor at next to nothing compared to the cost in American cotton mills. At one time they had built up a good trade in China, the greatest consumer of cotton among the nations. But the boom caused an effort to establish weaving on a larger scale in Japan and the small weavers were greatly encouraged. encour-aged. They bought the Japanese yarns at fancy prices and the spinners thereupon there-upon allowed their stable business in China lo go by default. Now the East Indian yarns have supplanted the Japanese Ja-panese yarns in I he Chinese market, the honiu market, is dead aud the Japanese Ja-panese spinners are making yarn to store in their godowns. Tho dividends have exhausted the treasury and ruin is imminent. Frenzied finance hns some queer kinks iu it iu this part, of this world. The Japanese business men seem to get at things from a different angle as thoy look on the world from their ob-Jinue ob-Jinue eyes. The cotton spinners had a meeting and discussed the loss of the foroign business. Now. it has been the fashion in Japan to bolster up by a subsidy any business too weak to stand alone. Japanese ships arc subsidized, some of them profitably so. These peo-I peo-I pie have seized on tho idea of a subsidy sub-sidy as a cure for every commercial ill and the subsidized concerns arc legion. So the cotton spinners decided to tax themselves for a private subeidy iu order to give a bounty on every "pound of yarn shipped to a" foreign market! This would, thev said, permit I Item to sell below tho market price. Hut this was taking the thing too far and the scheme din not hold together long. One native newspaper said it was a case, of ''cutting the flesh of the thigh in order to eat. ! aud I hat. view appealed to the spinner when there were called ou to pay their share of a bounty to bo given to some other spinner to reward him for cutting down the price of their own product. The spinning- mills will have lo close down if conditions aro not righted at once. Silk reeling establishments arc already closing and silk production v,-ill bo curtailed next year. Thus far the vast amount of public work going on has kept the most of the people in cm-plovnicml, cm-plovnicml, but. as the people pay the bills through taxes, this is another case of cutting the flesh of the thigh to cat. It may help for a time, but the day of reckoning will come. Among the masses of the people the prosperity caused by the unusual distribution of money during the war is still manifest. This is a point to br i-onsidered in reckoning Japan's fighting spirit. The nalion has a million nieii who would welcome a Avar that they might flock j inlo the army not because of the old samurial fighting spirit, but because as soldiers they have better clothing, bet- I tor food and boiler pay than Ihov could ever hope lo have as working 1 men. The Japanese soldier fares not half so well as the American regular. I The difference in the Condition of the laboring classes of the two countries1 is forcibly illustrated at this point. , The Japanese piny to get into the army ; for the good pay the recruiting offi cor in the United States has to beg imiii Id fillip! A people as poor as this cannot af I ford even one week of idleness. When tin- factories stop in the United States ; it causes much suffering, it is true, but ; when they stop in Japan the word suf- i fering docs not go far enough, it means I starvation. Many of the wisest men iu Japan believe it was a good thing that the j boom burst so soon. If it had gone ou for another twelve months it would, hae involved absolutely the entire capital cap-ital of the country and the wreck would j have been complete. That the crash I eame before it was physically, possible j for some of the people to get their i money up. has helped the situation. ; .As most of the capital thai was in- ( vested was borrowed abroad, the other i nations are much interested. Hut nev- ertholess. black as Japan's financial j outlook is at this time, there i still faith In the face of the panic and the government policy of taking over i transportation properties at its own al i nation whenever it gets good and ready, a British company has put up $5,000 1 OUD for an electric railway to be eight v three miles long. The dismal failure of t lie first great steel making project iu Japan has not del erred other yen turous souls and a new stool company is about to be perfect ed with English money actually in sight-No sight-No nation is more interested iu Jnpnn's commercial prosperity than i the ITnitcd States. Ours is the largest . share of its foreign business, and the financial health of tho two countries is closely connected. Japan has shared ' our moiietarv troubles, although infinitely infi-nitely less able to boar them, and it . i certainly to be hoped thai she will ' share our returning prosperity. Hut as yet there is little hope of a speedy recovery, re-covery, ami the industrial situation in Japan is extremely gloomy. Frivato I finances and credit are strained. Hub I lie finances arc in a tangle that is j causing a storm of protest from every J part of the empire. Hut that is an- i other story. To feel the tragedy of the thing as a Japanese must teel it. one t must imagine himself making pasteboard paste-board boxes for wages of three cents for a ten-hour day. Even the American imagination refuses to work for such wages. Tomorrow Jnp.mesu Business Mcth- ; ode. . i |