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is made with the state of things thirty years ago, the present burden is not to be considered unreasonably heavy. The reasons for the opposition in the Diet to the successive measures of increased taxation have been political rather than financial. It may be safely asserted that in maintaining the equilibrium of State finances after the war with China the taxpaying capacity of the people has not been unduly strained.

It is true that great economic distress prevailed in the country in 1901; but it was the reaction of the expansion of enterprises that came about after our victory over China. That a period of expansion is followed by a period of depression is not an uncommon economic phenomenon; only in this case the reaction had been aggravated owing to the lack of experience on the part of the promoters of business enterprises, and to their refusal to listen to the warning of prudent and far-seeing men. It is only of recent date that commercial notes came to be widely used among us, and those who have not quite realized the conditions of this system have succumbed to the temptation of abusing their credit. The failure of a number of banks produced an undue sensation in certain quarters. As a matter of fact, the failing banks were all small ones that had been recently established, and whose organization and management had been defective from the outset, and there was not one instance of the failure of a bank of long standing and established credit. All this shows that the distress of 1901 was the result not so much of the exhaustion of economical vitality as of the imperfection of method. Thus, the general economic situation was never so grave in reality as a cursory observer might conclude from the apparently alarming symptoms. This distress will have served to eliminate unsound elements from the economic world. If the lesson furnished by it is taken to heart by business men, as it will certainly be, a healthier development of the abundant national resources may safely be looked to in the future. The depression has passed the culminating point, and the balance of foreign trade has been turned in favour of our country. We need not, therefore, entertain misgivings about the carrying out of our financial programmes, even if they have had to be postponed for a time.

To establish gold monometallism in place of a de facto silver standard is indeed a thoroughgoing change, and the influence of that change on the future economy and finance of the country will doubtless be great and far-reaching.

The coinage system in vogue at the time of the Restoration (1868) was based on the system that was first established in the 6th year of Keicho (A.D. 1600), and since that time, for more than 260 years, no change has ever been introduced into the system. Yet, owing to growing financial distress, the Shogunate