NEWS OF THE WEEK
THE Japanese advance on Nanking continues steadily and it is now thought possible that, despite Marshal Chiang Kai:Shek's• announcement that. the city _would be defended to the last, the_ capital of his Governnient may be abandoned, without resistance.: Nanking is strongly defended and is capable .of a, prolonged resistance ; but the Japanese advance to the south threatens to cut off food supPliei and the only line , of .retreat... Marshal -qhiang Rai-sheit may therefore be- wise to retire front -the city . and withdraw with his forces intact to Hankow. Indeed, such tactics may well be China's onbr chance of Piolonging the war and of seriously embarrasiiniTaPiti.-, At Shipihai the problems of transfer- ring audio:vit.-3i. from China to Japan • have alreadi become difficult. Thejaipanese are now-in a position to control the Chinese mistonis; whose revenues are assigned to the service on China's foreign loins; and .though as' yet there:has. been no interference, it is possible-that the service on-the loans may be stopped as a means to securing British and American assent to the terms Japan means finally to impoie on -China. Local complications have -been- caused: by: a Japanese attack on an American tug front :which the American flag was torn down ; but America does not suffer alone as Italy, Japan's ally, in the-anti-Comin tern -pacts endured a similar insult. Twenty-four hours later the Stars and Stripes were re-hoisted by the Japanese, with apologies.
