in the loyalist ranks than in the rebel ranks, and German ammunition and guns were freely served to the imperialists. After the battle of Hanyang, two Germans were found among the imperialists’ dead, and two of the imperialists’ wounded were Germans, one of them a colonel in the German army. The Japanese trusts, the princes of the Choshiu and Satsuma clans, who control the House of Peers and the Genro Council, and thus run the government by veto, did not want a republic in China. They feared it would bring about the control of the budget by the House of Representatives and real popular government in Japan, which country is now absolutely controlled by the aristocracy; for the Japanese Diet is no more representative of the overtaxed people than is the Russian Duma. They feared also that if the Chinese pope-emperor could fall, so could the Japanese pope-emperor who was no more holy. The German syndicates were also anxious to maintain their confiscatory privileges in Shangtung province, which were obtained from the Manchus. Dictator Yuan always preferred German instructors in his Pechili, Honan and Shangtung armies. On November 27th, Yuan Shih Kai, the premier-dictator at Peking, had poured out the treasures of the Manchu empress dowager’s private chest, and well paid and well armed troops were rushed to Hankau. Generals Feng and Wong Chou Yuen had 30,000 modern drilled and equipped men, and the divisions were heavily supplied with precise artillery. Hankau City and Hanyang arsenal across the river were bombarded mercilessly, and the imperialists of Wong’s bloody third division, under cover of this artillery practise, crossed the Han River thirty miles up and flanked the left wing of the rebels, whose old Armstrong artillery, using percussion shells, was no match for the modern three and four-inch guns of the imperialists, who had the arsenals of the north and the Germans at Kiaochou to draw on. Neither was the rebel infantry equal, as half of their regiments had been drawn back to Nanking, 400 miles away, by river. The best the rebels could do was to oppose 15,000 men, with weak artillery, to 30,000 excellently equipped imperialists. The result was that the all-important Hanyang arsenal and world-wide known iron works were lost, and Generals Li and Hwang Hing had to retreat to Wuchang, the rebel capital across the Yangtze River, which is a difficult place to defend, as its flanks and rear are vulnerable. The result of this great reverse was that the lukewarm viceroys in the northern provinces, who had gone over to the rebels’ cause in the first flush of success, began to declare again for the Manchus. Shangtung province went back, and Yuan Shih Kai by the telegraph on this day got his own province of Honan to return to the imperial fold. Both of these are northern provinces. Premier Yuan now began rushing reinforcements down the Grand Canal and railway to Yangchow and Pukow, nearly opposite