In this way and on the recommendations of Count Matsukata the needful redemption was brought about, and at the close of 1885 the difference between the value of silver and paper money had almost disappeared. Notice was given by the Government, therefore, that on and from the 1st of January 1886 specie payments would be resumed. The actual amount of specie held at that time in the State coffers was of the value of £4,500,000 sterling. The adjustment of the paper currency thus accomplished prepared Japan to reap the benefits of a scientific system of coinage. The rate of interest fell,—commercial and industrial enterprises began to expand,—the volume of the country’s foreign trade increased greatly. Count Matsukata had rid his nation of one serious impediment to its progress, but in the process Japan had become _de facto_ a silver standard country. Sooner or later, as he well knew, she would have to enter the international economic community, and to do this she would have to adopt a gold standard. Prior to 1873 the price of silver had not shown any great variations, the ratio between gold and silver having been as a rule 1 of gold to 15½ of silver. Count Matsukata attributed the immense fall which took place in subsequent years to a number of causes, (_a_) the vastly increased annual output of the metal, (_b_) the action of the German Government in selling large quantities of silver when unifying the coinage of the Empire, (_c_) the adoption of a gold standard by the United States of America, and (_d_) the various limitations imposed on the coinage and in other forms by Continental nations. None of the measures adopted were sufficient to check the fall. In 1879 the ratio became 1 to 18,—in 1891 it was 1 to 20·92,—in 1892 it was 1 to 23·72,—and in 1893 it had become 1 to 26·49. But this was eclipsed by the figures for 1897, which at one time were as 1 to 39·70 and the average for that year was but 1 to 34·35. In Japan the consequences were most serious, for the price of commodities rose rapidly and a spirit of speculation became rampant.