It is necessary to go back a little, to the period of Count Matsukata’s initial efforts to pave the way for the introduction of a gold standard. That his financial policy led at first to Japan becoming a silver standard country was owing mainly to the immense difficulty of at once accumulating a large gold reserve necessary for the establishment of gold monometallism. It was deemed advisable to defer this essential, all but vital, alteration to some more favourable time, but Count Matsukata never relinquished for one moment the hope of being able to effect it. When it is remembered that in April 1881, 1 yen in silver fetched on an average 1 yen and 79½ sen of paper, and at one time the proportions were as 1 to 1·815,—the lowest point ever reached,—and yet four years and a half later paper and silver were on a par, the magnitude of Count Matsukata’s achievement becomes apparent. The imperial ordinance authorising the Bank of Japan to issue convertible notes was obeyed when, on the 9th of May 1885, the first of such notes were put into circulation, and the moment was seized by Count Matsukata to urge on the Government, as Minister of Finance, the advisability of taking the opportunity then presented for redeeming the whole of the inconvertible paper, and of entrusting the business of the exchange entirely to the Bank of Japan, to be effected in the ordinary way of circulation, so that the reform might be quietly and smoothly carried out. “If,” he concluded, “these suggestions shall happily receive the August Sanction, not only will the Government be able to accomplish its original purpose in regard to paper money, but the credit of the Government at home and abroad will thereby be assured, the national finance placed on a firm basis, and the future happiness of the people greatly enhanced.” In the year 1884 Mr Matsukata, as he then was, received the rank of _Haku_, or Count, continuing to hold the portfolio of Finance until 1891, when he was appointed Prime Minister, but without relinquishing his post at the _Okurasho_, and he only quitted it, after a service of nearly twenty years in that department of State, when he resigned the Premiership also in 1892. In the office of Premier of the third administration since the institution of Constitutional Government Count Matsukata had for one of his colleagues Count Enomoto, who had represented his country at the Courts of Russia and China, and had previously been Minister for the Navy. He now held, in the Third Cabinet, the portfolio of Foreign Affairs. Count Matsukata’s occupancy of the position of Prime Minister lasted on this occasion from May 1891 to July 1892, there having been a general election in February of that year which had resulted in a victory for the opposition, followed by Cabinet disruption, and the advent of Count Ito, as he was then, to a long lease of power.