The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1901-07-26

Keen appetite should not be given too
much food otherwise bee may iniure HE
stomach and br 80 again The com
plant raised in certain quarters that the
Bank hcsltHtcs TO make advances nn
such an important staple AZ six is Ike
that OF a greedy patient howaillng tnc
insufncicncy of his diet The excess OF
Imports over exports has continued for
years and the cnluN Of specie knows no
end In this prccarlOus state OF AFFAIRS,
II In but proper for a central bank TO
raise It's rate OF interest and withdraw
It's notes from circulation In order 10
maintain the stability Of the conversion
system and take steps to lead the
economic world gradually back to It's
normal condt ton with the Bank Of
Japan pursuing such a course, other
banking concerns have Of course TO be
cautious spondinEly. ina-much as
they cannot freely utilize the capital OF
the central bank even If they may have
plenty OF good securities or drafts in
hand, while their creditors are apt to
be alarmed by absurd reports and ready
to draw off their deposits at any moment
Every bank has, therefore, to reserve a
large amount of funds against its credi-
tors, so much reducing the amount of
money in circulation. Moreover, tho
credit of individuals usually huctuates at
times. one who could collect million
yen yesterday may not be able to bor-
row half as much today. The necessity
of keeping large amounts of reserve
funds coupled with the uncertainty of
the credit of individuals, renders 1t i'm
possible for any bank to make advances
as freely as at better times. II Is then
too much to say that banks are reluctant
to lend; on the contrary, they are al
ways anxious to lend as much as they
can afford to do If they can only be
cnr tat Of tln Of tlnt doh
BRIGHTER FUTURE IN PROSPECT.
How long the present depression
will last is IA question which every
body naturally asks. Japan's economic
organization is on a very limited scale
as compared with that of Europe or
America. and it's different parts are not
related to one another as closely as in
other countries. This want of close rela-
ton does not make the whole work
smoothly under ordinary circumstances;
but then there Is this advantage, that
the failure of a few banking, Industrial,
or commercial concerns does not tell on
the whole to any serious extent. In a
country where the credit system is not
fully developed, such seems to be always
the case. Many firms apparently doing
well may really be on the verge of ruin,
and the comparative rarity of cases of
bankruptcy may partly be accounted for
by the fact that Japan has not yet ad-
vanced to the stage when single fall
ure may suspend the vitality of the
whole economic mechanism. Be the
theory whatever it may be, the Bank of
Japan firmly sticks to the policy of
Withdrawing it's notes, and other bank
ing concerns have to use the utmost eau
ton in making advances: whIe all firms
whose resources are exhausted have been
doomed to their natural fate, and 1t
seems no>frm of questionable standing
remains in existence-the long continued
depression has so thoroughly swept and
Cleansed the business world This must
be a rude shock to Japan. from the
smartng effects of which the country
may have to suffer for some time to
come. Now that the people have be-
come cautious. however, we may console
ourselves by the fact that the worst has
already come, and the pains which we
are suffering and will have to suffer for
a little time longer are harbingers of
better days, such being usually the way
to recovery. 1t is impossible to say ex-
actly when the longedrfor activity will
again come. but should the silk trade
of this year change to be active Japan
will be, early next year. in the position
of a patient bedriddeR for many days
past who has SO far improved as to be
able to walk in the suburbs.