Anyone who ig familiar with the conditions "existing "in the local financial market Will be aware of {the largo" volume of liquid funds seeking profitable " employment in Shana "These funds ave provided for the most part by the Chinese themselves, and do not represent to from those countries abroad where any extent a transfer of capital
money rates are now at an unprecea low level. During recent years there has been a considerable influx of Tandy to Shanghai" from the interior, either because of the existence of banditry or because investment, in agriculture is no longer profitable. It is interesting [struction scheme domestic bonds put into effect atthe time of the Fapanese hostilities at Shanghai a year and a half ago. Market quota tions of government domestic bonds have a chan fallen o lo ha gar prisingly high yields have been Sbtainable on this class of invest ment. During the past year, when oan service was regularly "main tained, and no new issues of domestic bonds' were made, market _quotations naturally improved but, the yield on the bonds still made prof table for those banks that were red to. hold this class of relatively fixed de-
It is possible to argue that in such circumstances the government Should be able to. Borrow on more favourable terms, bat this argument Sverlocks a number of Amparant consideration that are clearly the minds of Chinese investors." At fil timer the percentage of the Rovernment's total revenue devoted "military and. other sampreductive expenditure is 30 high. het any. Sppreciable'deline ip revenue Teceipts, or any new political ci That may involve increased expend ture of the same kind, is quickly effected in domestic bond "quota: Tons. "Moreover, itis lo than two Year ago that the iterant rate Sutstanding bonds was by govern out decree reduced frame eight to six per cent, while the period, of Fetemption, fixed. at the Mime. the Donds were offered for subscription ens roughly doubled. eeause of the damage done. to the government's credit by" improvident financial methods tu the past, and because of The continual neeréainty regarding Future' developments, ancial loans Became impracticable, fo. that. the government has in. feet years been forced to resort to Short-period treasury bills repayable monthly instalments, The price fat which. these treasury Bills could purchased. in the bond market nave not only: a relatively high jo-[Great yield but also the chance of considerable capital prest, provided finan service was regularly maine or a reasonably short period For this reason "many!
Stance' in the government bon fnarket instead of investing their the st "tend money, more, permanently in com-Reveal and nduntnentenisen, jones marker inthe shares. of in part may explain why Ghiveserowned business under~ takings has grown we in, Shanehal ings hus in Shanghai, land why it impracticable to develop 2
(Continued on pane 236. blent conference was called, but, Unfortunately, certain quarters did Know its real significance and it failed. ery undenliale, continued, ang, that nui expenditure now. formed the main item in the national budget. The Government revenue for the year 1933 was ted at $680,000,000 and expenditure, at $800,000,000. The annual deficit was estimated at $148,000,000.
The Communist Menace Owing to the antiCommunist campaign in Kiangsi, and the sup pression of bandits elsewhere, the Hefcit probably would. be much meger. TI the Communist or any ther groups attempted to di and onder by the Use of armed
fis day to protect. the. people," mus force, the Chine Gpverament ith fextormuate such elements, who not nly endangered the security of the Government. and the Kuomintang, out of the entire nation. ite there: fore hoped the whole country would assist the Government. in the anti-{Gonmmunist campaign, At the same time, the Government's. policy fneveasing revenue and" reducing expenditure must proceed simultane: fous changes: churia and. Jehol, while available: the nati anal con and Supplies. greatly. exceeded domestic amazing progress in educational, consumption, and it. way feared industria 1, commercial and materint hat the balance may. find its: way went of every Kind. to'iiliet tref in' China, hho continued, that he wa tne 13 was a matter of deep regret,
the statement The, Chinese, delegate, wonportd hich, he said) was, identical Yecond an. can measure. Of Dry: gress In the political sphere, though the views of {he Chinese Gov There, ha, ment thou been some ogress, and ight it could rightly be The Italian delegate made that real progress—if tess servations on the serious position in been hoped: beea the Par East. ma towards stability of govern-ring the past six years, that the full text, of Mr.
The Japanese delegate
Text read from the printed page and cleaned; old type leaves the occasional error.