It is significant that the new Ministry's first act was
to prohibit the export of gold and thus to send Japan 4)ff the gold standard in company with ourselves and the majority of the other nations. The late Finance Minister, Mr. Inouye, had striven hard to maintain the exchange value of the yen in relation to the dollar by shipping gold to America. He. had thus, it is hinted, foiled some Japanese financiers who were speculating heavily for a fall in the yen and who were thus exposed to heavy losses. The new Ministry has saved them, if the story he true. From our own standpoint as rivals of Japan in Eastern markets, Japan's departure from the gold standard must enable her to quote lower prices in India and China and thus to compete effectively once more with Lancashire. The new Ministry is credited with the intention of expending large sums on State subsidies for -industry, combined with still higher tariffs. But no such policy can succeed unless the Chinese boycott of Japanese goods is brought to an end by a peaceful settlement in Manchuria.
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