The Washington herald., 1908-04-08

| Tokyo. Feb. 23.-When Japan took unto
itself the blessings of Western civilizs-
ton, it was inevitable that the curses
must be included. To-day it is suffering
from having taken a flyer at frenzied
finance. After the war with Russia, the
japanese rushed headlong into a BOOM
The collapse has come and the nation is
gasping. It might have borne the burden
OF its own folly without great trouble,
but the sins Of America are also visited
upon Nippon. For every American girl
who is pouting because that horTid Wall
street has deprived her OF a new silk
gown, there is a soTrowful almond-eyed
maid in beautiful Japan who mourns the
less Of the cents a day which she
earned by feeding silk worms. Among the
most marked effects OF the recent panic
in the United States was the falling of
in demand for silks. Consequently. the
/ g0downs of Yokohama contain so, ,o0o, 900
worth Of raw SILK at a time when. in a
normal year. they would be empty This
silk is unstable at a profit, and every
time a bale changes hands now it means
a loss
The silk grower in the country did not
foFesee the financial crash, neither did
his country banker. The grower needed
ready money. and the banker advanced
it on the security Of the silk. Now the
price has fallen and the silk is prac-
tieally unstable. The silk grower can
not pay the banker. The banker must
pay his depositors From these things
come bank runs. from bank runs come
failures, from failures comes loss Of en-
ployment and from loss OF employment
comes starvation. And this in a country
where 20 cents day is high wages for an
abIe-bodied man.
II there had been money in the coun-
try the temporary cessation Of American
purchases here would not cause such Sc
rious embarrassment. But Japan has
never had much money. and what little
II did have has gone into the great in
dustrial companies organized during the
boom which started a few months after
the close of the war with Russia and
which tumbled into nothingness with the
crash Of last year The japanese gov
ernment tried in many ways to restrain
the fever for speculation. knowing that
the resources Of the nation were not suf-
ficient 70 sustain 500 10000 worth Of new
industries at this time. But the advice
was not needed. and speculation stopped
only when the bubble burst. Now the
government seems 10 forget its role of
friend 10 commercial interests. and re-
fuses 10 take any steps 10 relieve cOndi-
tions. On the other hand the burdens
OF its people are augmented by the levy
Of new taxes. although the war tax has
not been lessened after three years Of
-F 81 gr.-fF til
from these poverty people, the
government spent last year:
On the army and nav. SIS 704 $50
Un euoat1on- 4Ile4iO
The war with Russia brought TO japan
so many hallelujahs and banzais from
all parts of the world that the Japanese
were almost convinced that there was
nothing which they could not do. 1t
was natural that they should turn TO
industrial fields and seek to sstonish the
world there as they had done in war.
Companies were organized to exploit the
meager mineral resources Of the islands;
others to manufacture raw materials to
be brought from China: others to take
advantage OF growing internal business,
and still others 70 push commerce into
foreign lands. Millions were subscribed,
and before the ink was dry on the papers
of incorporation a dividend would be
declared. This artful dodge deceived the
innocent lamb Of Nippon, and he rushed
to his little Wall street with his savings
The prices OF shares scared to the skies
Then came the Notwithstanding financial
troubles Copper, Japan's greatest min
eral product, dropped to the bottom.
Then came the silk disaster, and Japan's
greatest domestic industry was peralyzed,
The balance of trade. in 1906 had run in
Japan's favor, and lis people boasted
that theirs was an exporting nation.
Within a few months the exports
dropped almost half. The Bank
of Japan pays a 12 per cent divi-
dend and is considered thoroughly
sound Institution. The par value OF It's
shares is 200 yen. "a yen is equivalent
to % cents In American money! In a
few months the market value dropped
from $50 to 5ss yen. The Tokyo Electric
Railway stock. par value 50 yen. dropped
from 1o6 to 81. and now municipallzation
of the property is in sight. The Osaka
Spinning Company has never missed
dividend, and it pays 20 per cent an
nuaIly It's shares. par 30 yen, fell from
i26 to 7s, In the face Of the one-fifth
dividend
How foolish the payment of such divi-
dends is has been proved in the very case
Of this spinning company. The japanese
cotton spinning mills. OF course, use for
eign raw material. They have excellent
mills and they have good labor at next
TO nothing compared to the cost in Ameri-
can cotton mills. At one time they had
built up a good trade in China, the great
est consumer OF cotton among the ma
tons. But the boom caused an effort to