FALL IN CHINESE AND JAPANESE STOCKS.
A week ago I gave a table showing the extent of the fall in leading Chinese and Japanese stocks, even since the end of last month, but that fall has now been greatly increased. The Chinese Loan of 1912, which had then fallen 9 points, now shows a decline of about 13 points, while the Japanese Loan of 1899, which had then fallen ioi points since the end of July, now shows a decline of about 154 points. Many of the leading Japanese loans now show a yield at present prices of nearly io per cent., or of an even higher yield, if allowance is made for ultimate redemption. And yet, up to the moment of writing, there is little disposition to acquire the stocks. This disposition is certainly not attributable to any reflection on Japan's credit over a considerable period of years, for that record is an excellent one, Japan having been punctilious in meeting all her financial engagements. Nor is it even due to a feeling that Japan has an unwieldy foreign debt (even allowing for her adverse trade balance), for a feature of recent years has been the large amount of her external debt which has been absorbed by Sinking Fund and other purposes. The fall in Japanese bonds and the reluctance to purchase at the present level is in fact due to the appre- hensions that the military party in Japan has now complete control over the policy of that country, and apart altogether from any ethical considerations it is doubted whether the financial and economic position of Japan can bear the strain which would be involved by a prolonged war in the Far East.
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