The Hawaiian star. [volume] (Honolulu [Oahu]) 1893-1912, 1901-05-10
JAPANESE FINANCES.

According to a report from Consul
General Bellows, the financial condition
OF Japan is at present far from encour-
agin~ and her bankers, statesmen. and
business men are exerting every effort
to avert pending panic. The situa-
ton, as analysed by the shrewdest
financiers and statesmen of the En-
pire. shows that the Chinese indemnity
secured at the close of the Japan China
war, together with large national loans.
led to the exploiting of many public
and private undertakings which caused
money to be unusually plentiful anon
the coolie, or laborin~ classes. This in
duced extravagant methods of living
and is assigned as a potent factor in
the large increase of imports. The
amount of indemnity paid by China
proved insufficient for the enterprises
projected and many millions were di-
verted from the customary channels of
trade to carry forward these under
takings.
The large increase in imports was I'M
fortunately accompanied by falling
off in exports during the past year.
occasioned by the interruption of the
Chinese trade, and decreased demand
for silk and other staples in America
and Europe, so that last year the rela-
ton of exports - imports stood in the
ratio of five to six, and So 200, 900 yen
(S24,90O,0 00) passed out of the country
to settle Japan's balance of trade. This
large outflow of specie led the Bank of
Japan to raise it's rate of interest, pro-
duced a glut of merchandise in the
store houses of the importers, and
caused a pronounced depreciation of
stocks, bonds, and securities.
The scarcity of money for CONNER
-cial and industrial purposes is all the
more keenly felt because of the steady
rise in price of all living expenses,
which have increased during the last
few years over rs per cent.
Foreign capital declines to enter the
Japanese market, although tempted by
flattering rates of interest. The Gov
ernment's recent effort to float a for
eign loan has not proved a success,
while school and municipal bonds, bas-
" a
desirable to foreigners because of the
faulty regulations and conditions at
tending their issue.
Both foreign and native banks decline
loans on personal credit. and at the
close IF 1899. the total paid-up capital
of the banks of the Empire. exclusive
of the Bank of Japan, was $119, 900. 600,
q "a
rying loans based on concrete security
to the amount of $125, 900, distributed
as follows: Lands and houses, $50 500,
900; goods, $51,25O. 900; public bonds
1923, 800, 600. From this, it will be seen
that the banks have tied uD in CON
crete investments a larger sum than
their total naid-up capital. and Min
lister Watanabe observes that this fact
is largely responsible for the present
embarrassment felt i'm business circles
The president of the Bank of Japan
at the last annual meeting of the share
holders, said:
Throughout the year under review
Q9OO), the specie reserve Of the banI
steadily dwindled month after month
the excess of imports over exports ant
a financial panic in Shanghai, owing t,
the Boxer trouble, all contributing t,
bring about this regrettable result. TIL
depletion of specie and the increased
demand for money occasioned by tn,
Chinese trouble necessitated the bank
issuing notes beyond the prescribed
limits in June and the succeedine
months.
The closeness of the money market
combined with the dullness of trad,
and violent fluctuations of prices, il
causir- much alarm among merchants
manufacturers, and bankers. and NOR
failures are imminent.