territory and exacting from her pecuniary fines under the name of indemnities. We know by a recent incident that the indemnity exacted from China by this country in respect of the Boxer rebellion was not really required for the ostensible purposes for which it was imposed. A large proportion of it lay at the Bank of England unappropriated, and eventually was attached by a rapacious Chancellor of the Exchequer for the purpose of alleviating the burdens of the British taxpayer. China is determined to have no more incidents such as this in the future, and the Russo-Japanese War has given her occasion for serious thought in the matter as well as pointed an obvious moral. As a result of her cogitations, she has concluded that the most effective means she can take in the direction of preserving the inviolability of her territory and preventing the exaction of periodical monetary tributes on the part of foreign Powers, is to establish a strong and efficient Army and Navy. As a matter of fact, I consider that in so determining China is acting not only in her own interests, but in the interests of the Great Powers of Europe. Not very many years ago that excellent sailor, Lord Charles Beresford, wrote a book entitled, somewhat too previously, "The Break-up of China." In selecting a title for his work Lord Charles without doubt voiced the opinion prevalent, not only in this country but in Europe, at the time he wrote it. The statesmen of nearly all the foreign Powers then seemed to have arrived at the conclusion that the scramble for China was imminent and, utilising their experience from what took place when the scramble for Africa was effected twenty years ago, they began apportioning in advance the territory that ought to fall to their lot. In this matter, however, they were wofully mistaken; the diplomatic physicians of the world may have diagnosed the symptoms quite accurately, but the patient surprised them all in regard to the course of the disease and her recuperative powers. There will be no "break-up" of China, and consequently we are not likely to witness any scramble for China. There has undoubtedly been an awakening of China, an awakening to her danger, to a sense of the extent to which her interests were imperilled. She wants, as I have said, to be severely left alone, and she is determined as far as possible to effect that consummation. The men of light and leading in China know perfectly well that they cannot now, even if they would, shut their country against European trade, European residents, European visitors. They are prepared to accept all these, but they will not have European interference. China is determined to work out her own destiny or salvation, call it which you will, and Japan is both willing and anxious to give her all possible assistance in that direction. The "yellow peril" bogey is, in my opinion, the silliest and most absurd cry that has ever been put forward by responsible persons. CHAPTER XX EUROPEANS IN JAPAN