The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1908-04-14
JAPAN'S FRENZY
Of INITIATION
How the War Boom Brought
Things Japanese to The
Verge of Collapse.
advertiser Correspondence. Copyright
1908, by Frederic J. Haskin)

(Advertiser Correspondence. Copyrigh
1908, by Frederic ]. Haskin.)
TOXIC, Mar 25.--When Japan too
unto itself the blessings of western
civilization it was inevitable that tn
curses must be included. Today it i
suffering from having taken a flyer a
frenzied finance. After the war witt
Russia, the Japanese rushed headlont
into a boom. The collapse has come
and the nation is gasping. 1t nigh
have borne the burden of its own folly
without great trouble, but the sins o.
America are also visited upon Nippon
For every American girl who is pout-
ing because that horrid Wall Street
has deprived her of new s4lk gown
there is a sorrowful almond-eyed maid
| in beautiful Japan who n1ourns the loss
of the six cents a day which she earned
| by feeding silk worms. Among the
most marked effects of the recent pan
| ic in the United States was the falling
off in demand for silks. Consequently,
the godoWns of Yokohama contain $780,
600, 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 loss.
The silk grower in the country did
not foresee 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 practically unstable. The silk
grower cannot pay the banker. The
banker must pay his deposltors. From
these things come bank runs, from
bank runs come failures, from failures
comes loss of employment, and from
loss of employment comes starvation.
And this in country where twenty
cents a day is high wages for an able
bodied man.
If there had been money in the coun-
try the temporary cessation of Amerf-
can purchases here would not cause
such serious embarrassment. But Jap
an has never had much money, and
what little it did have has gone into
the great industrial companies organ
lied during the boom which started
q few months after the close of the war
with Russia and which tumb1ed into /
nothingness with the crash of last year
The Japanese government tried in |
many ways to restrain the fever for |
speculation, knowing that the resources
Of the nation were not sufficient to sus- |
ain a half billion dollars worth of new
Industries at this time. But the advice
vas not needed and speculation stopped
,nly when the bubble burst. Now the
seems to forget its role of
+o oil int
uses to take any steps to relieve con-
iitions On the other hand, the bur-
lens of its people are augmented by
he levy of new taxes, although the
var tax has not been lessened after
hree years of peace. And of this tax
money collected from these poverty
tricken people, the government spent
asst year:
On the army and navy-$115, 704,6 $50.
On education-S41 us, 40.
The war with Russia brought to
apan so many hallelujahs and BAN
ais from all parts of the world, that
he japanese were almost convinced
hat there was nothing which they
Guild not do. 1t was natural that they
hould turn to industrial fields and seek
0 astonish the world there as they
ad done in war. Companies were or
anized to exploit the meager mineral
esources of the islands, others to man
facture raw materials to be brought {
rom China, others to take advantage
growing internal business, and still
theirs to push commerce into foreign
ands. Millions were subscribed, and
efore the ink was dry on the papers
{ incorporatin a dividend would be
eclared. This artful dodge deceived
ne innocent lamb of Nippon and he
lshed to his little Wall Street with his
avings. The prices of shares scared
!, the skies.
Then came the Notwithstanding finan
al troubles. Copper, Japan's greatest
lineral product, dropped to the bot
I'M. Then came the silk disaster, and
apan's greatest domestic industry was
aralyZed. The balance of trade in
,06 had run in Japan's favor and it's I
eople boosted that theirs was an ex- :
orting nation. Within a few months
lie exports dropped almost half. The :
ank of Japan pays a twelve per cent Il
lvidend, and is considered thorough !
sound institution. The par value t
{ its shares is 200 yen "a yen is
Iuivalent to fifty cents in American '
loney.1 In a few months the market V
alue dropped from $50 to SIS yen. The l
okio Electric Railway stock, par
alue so yen, dropped from 106 to 50, 7
nd now municipalization of the prop G
rty is in sight. The Osaka Spinning s
ompany has never missed a dividend I
nd it pays twenty per cent annually
Its shares, par so yen. fell from 126 to '
3, in the face of the one-f1fth dividend II
How foolish the payment of such t
ividends is has been proved in the
cry case of this spinning company. {
he japanese cotton spinning mills, of {
curse, use foreign raw material. They
ave excellent mills and they have good ]
abor at next to nothing compared to {
he cost in American cotton mills At
ne time they had built up q good
rade in China, the greatest consumer
f cotton among the nations. But the
loom caused an effort to establish
on larger scale in Japan and
he small weavers were greatly en-
outraged. They bought the Japanese
arms a fancy prices and the spfnners