Expenditures of the Russo-Japanese war / by Gotaro Ogawa.

176 ECONOMIC EFFECTS OF THE RUSSO-JAPANESE WAR

for the important centers of the country. A slight decrease
was the next tendency, so that by March, I906, the amount
dwindled to 504,000,000 yen. But in the latter half of that
year a sudden rise in industrial enterprise absorbed an amount
of capital, in October, twice as large as that before the war.
The monthly changes in the amounts of loans by the Bank of
Japan and private banks at important centers of the country
were as shown in the table on page I75.
INFLATION OF CONVERTIBLE NOTES AND SPECIE RESERVE
The issue of convertible bank notes was constantly on the
increase during and after the war. This was partly due to
the fact that bank lending for private enterprises increased
as activity set in again in the business world as the war
developed. The greatest causes, however, were an increase
in government debts, an increase of demands for circulating
capital in consequence of the issue of the exchequer bonds,
and an increase in the amount of issue of the Treasury bills.
The causes of the increase of convertible notes, therefore, can
all be traced to the war. To cite the concrete figures showing
this general trend of affairs, the issue amount of convertible
notes, which averaged 200,000,000 yen during 1903, fell to
I99,000,000 yen in April and May of the following year.
However, after that the figure was steadily on the increase,
through more borrowing by the government and the swelling
of circulating capital resulting from the issue of Treasury bills.
Setting aside as exceptional the amount of 286,000,000 yen
attained at the settlement season of December, I904, the
figure was never short of two hundred and thirty or two
hundred and forty million yen. But the amount of convertible notes circulated in Korea and Manchuria between the
outbreak of the war and the end of April, 1905, is estimated
to have reached 30,000,000 yen; therefore, those circulating
in Japan did not greatly exceed the usual total. At the end
of December, I905, the issue amounted to 312,000,000 yen;
at other month ends, however, the figures always remained
between two hundred and sixty and two hundred and seventy