Page:Japan by the Japanese (1904).djvu/406

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JAPAN BY THE JAPANESE

in excess of the above legal limit. These notes are subject to a special tax. The rate of the tax is to be 5 per cent. or more. In the German system this rate is fixed at 5 per cent.; but in the Japanese system only the minimum rate is fixed, and the power of discretion is given to the Minister of Finance, who may charge any rate above 5 per cent., according to the state of the money market. This is quite an effectual measure to alleviate any stringency of the market, and at the same time to secure the immediate withdrawal of superfluous notes when the necessity is over.

This system of note issue seems to be particularly well adapted to meet varying demands of trade in a country like Japan, where, on account of her geographical position, specie cannot be called in from abroad to respond to the immediate need of the market.

The following figures show the outstanding amount of notes issued at the end of the respective years:

00,000,000Yen.
1885
…          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …
 005,400,000
1890
…          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …
 153,875,236
1895
…          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …
 209,607,448
1900
…          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …
 228,570,032
1901
…          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …          …
 214,096,766

The kinds of business transacted by the Bank of Japan are mentioned in its by-laws as follows:

  1. The purchase or discount of Treasury bills, bills of exchange, and other commercial paper.
  2. Dealing in gold and silver.
  3. To make loans upon gold and silver coin and bullion.
  4. To make collection of bills for banks, corporations, and individuals who are the regular customers of the bank.
  5. To receive deposits and accept the custody of objects of value and documents.
  6. To made advances on current accounts or loans upon the securities of Government bonds, Treasury bills, or other bonds and shares guaranteed by the State.

Besides these, the bank performs a number of important services for the Treasury without compensation. Not only does it receive and pay out public revenues and expenditures for the State, but it also manages all operations concerning public debts and public deposits. The withdrawal of the Government and national bank notes has also been dealt with by the bank. In fact, certain parts of the bank are closely united with the various departments of the Treasury.

Bills and cheques in modern forms are new things in Japan. For the last twenty years the Government, as well as the bank,

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