The Bemidji daily pioneer. [volume] (Bemidji, Minn.) 1904-1971, 1920-10-14
PRICE SLUMP HITS j..
JAPAN HARD BLOW
Government Helps Keep Prices
Up But Day Of Reckoning
= Is Only Postponed

Tokyo (by Henry W. Kinney, by
maiD While it is generally expect
ed that Japan's business, which is still
very much depressed, will revive con-
siderably with the, beginning of next
year, it seems that it will be neces-
sary to. take far more drastic steps
to bring this about.
Following the great drop Of prices
which took place some months ago
and the great slump in the export
trade, a great congestion of goods
has occurred. This is seen very strik-
ingly in the large ports, such: as Yoko-
hama and Kobe, where warehouses
are; crowded to- the roofs with goods,
ordered during the boom, when every
importer figured that merchandise he
ordered would increase materially in
value while in transit. This had be-
come so common that merchants had
come to look thereupon almost as a
fixed law of trade. Consequently
when the slump in prices occurred,
thousands and thousands of tons Of
goods ordered mainly for speculation,
arrived, their prices on arrival being
considerably lower than when they
had been ordered. The consequence
was that in many cases the consignees
refused to accept delivery, while in
other they were unable to secure the
necessary funds from the banks, as
these became extremely tight the
moment the bottom dropped out of
the market. = !
Some little relief has been obtained
in some cases by reshipment of re-
Gently imported goods to foreign
countries, and many ton of merch-
andise made the trip back to Amer
lea after it had been landed on the
docks of Yokohama or Kobe. The
warehouses remain. crowded, how
ever, and the existing glut becomes
daily greater as the output of jap
anese factories continues to add
thereto. To offset this the leaders
Of many Industries have restrained
their production by operating only
part time or by closing altogether:
Thus the cotton mills run only sixty
per cent capacity. ..
!, Theaone step which seems obviously
necessary, namely, to get rid of the
glut by selling the accumulated goods
at lower prices, even at loss\ if
necessary, is the one step which the
business community will not. take,
and in this attitude it is upheld by
the government, which has advanced
tremendous sums to this and that in
dustry for the purpose of keeping up
the utterly abnormal situation. While
this may postpone the day of reckon
ing, it will, Of course, be impossible
for the government to advance funds
forever, and the only real effect will
be to make it take just so much long
er for business to get back to a sound
basis. In the mean time concern
after concern is going under, some
of them large ones. The government,
which is run almost exclusively in the
interest pf big business, is doing what
it can to encourage various combina-
tions for restraint of competition and
Of prices, with the result
that the general public sees little
benefit from the slump in prices. =,
AS a--direct consequence of the
in export and import bust
ness, shipping is suffering. During
the war, when freight rates scared,
Japan built hundreds of tons of ship
ping, but: her great merchant fleet
is beginning, to become a white ele-
plant on her hands. Freight rates
have gone down to rock bottom, and
charters with them. An ever increas-
ing number of vessels are being
laid up.
All these conditions have not failed
to have their effect on the labor
as many workers have been
altogether including
many seamen, while others work only
part time. In the same way the mid
die class is being seriously affected,
as many Of the largest corporations
are discharging employees, mainly in
clerical positions, by the hundreds.
The losses caused by the slump, have