were still in Seoul. When you add to all these things the tremendous influence which the abortive Nagamori scheme had on all minds, it will be patent that the Agreement of August, 1904, became known at a very unfortunate moment.

Under these circumstances it was not astonishing that I left Tokyo in the month of October, 1904, with the frank confession from those best entitled to know that Japanese policy in Korea had been a complete failure since the beginning of the war, and that great efforts would have to be made to restore things to a satisfactory condition. Korea is admittedly the Japanese South Africa-the grave of all good reputations; for in twenty years no less than fourteen successive Ministers have reigned at the Japanese Legation in Seoul, and in all but a few notable cases have been recalled with besmirched reputations. So distasteful has this office become that only the most determined men can hold it and not become discouraged.

It was with no little curiosity that in November I began a careful study on the main position of the battlefield of Japan's hopes and fears-Seoul-and it required but little investigation to be thoroughly convinced that Mr. Hayashi, the present Japanese Plenipotentiary, is emphatically the right man in the right place. Of medium height, square-jawed and determined, and yet possessing a Muscovite finesse, the Japanese Minister is a man who not only commands everyone's respect, but also their confidence and sympathy. Had his powers been larger and

his position more clearly defined, it is almost certain that much which is even now left undone would have long ago been brought to a successful termination. But the Japanese Government has yet to learn that Seoul cannot be managed from Tokyo.

By December both the nominees of the Japanese Government under the August Agreement had arrived in Seoul and were entering on their duties. For the delicate task of Financial Adviser the Tokyo authorities had selected a Japanese expert of some repute, Mr. Tanetaro Megata; and as Diplomatic Adviser (who it was stipulated should be a European) Mr. Durham White Stevens had been selected. The latter, an American diplomat, commanded the complete confidence of the Japanese Ministry. Originally a secretary of the American Legation in Tokyo, he had been for many years attached to the Japanese Legation at Washington, and had there shown himself a champion of Japan. The two best selections had undoubtedly been made, and by this careful carrying out of the first clauses of the August Agreement there was little danger of the third-the proviso that Korea should not enter into any open or secret arrangements with other Powers-being ignored.

Seeing that so few weeks have elapsed when I write, it is perhaps presumptuous to venture on any criticism of either of these two gentlemen, who sooner or later will have much to do with the welfare of the country; but since it is of the utmost importance that Japan should not only make good

her position in Korea, but gain as well the confidence and goodwill of all classes of the population before the termination of the great war, it is necessary to continue pointing out features which deserve immediate attention. Of Mr. Stevens, a discreet and patient diplomatist, but little has been heard, as the most difficult part of his task, the abolition of Korean Legations abroad, and the negotiations for the reduction of the Foreign Legations in Seoul to the rank of Consulates, is still to be worked out. But of Mr. Megata's manoeuvres all are already talking.

The worst feature in Korea is undoubtedly the deplorable condition of the country's finances. The fiscal disorder which holds sway from Seoul to Stamboul finds its most eloquent expression in the extreme Eastern end of the Asiatic mainland, Korea. Here you find a currency, or rather a collection of mock currencies, which have become so debased that they no longer deserve the name of money. Divided merely into various degrees of spuriousness, the Korean nickel, itself a filthy coin of extraordinary slimy appearance, is far surpassed by the copper cash of the provinces, which are mainly a compound of sand, iron, and dirt, and excite the laughter even of Chinese traders, themselves accustomed to minted atrocities of sufficiently startling character. Above these coins there are nothing but Japanese yen notes, the former silver dollars having been almost entirely withdrawn, and the other native coins being now non-existent. Customs payments

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are made in Japanese yen notes; a Japanese bank, the Dai Ichi Ginko, receives such payments at the treaty ports; the new railways are carrying the money from one end of the country to the other, Japanese traders at inland places, like Taiko and Pingyang, carry all their capital in the same paper money, and lastly all Europeans use them. The moral is clear; there must be something like the former Latin union between Japan and Korea in order to inaugurate the first great step in financial reform. Thus the creation of a National Bank of Korea under Japanese auspices, with branches at all the treaty ports and the important provincial centres, is an absolute necessity; and conjointly with this must come the establishment of a Korean mint charged with entirely changing the coinage of the country. Hitherto there have been plenty of attempts at establishing cash and nickel factories, but the sooner these become distant memories, the better for the country.

With this Korean Bank and Korean mint properly organised, the payment and receipts of the Government can be properly overseen and accounted for and a bona fide yearly budget framed. And this step brings us to another which is worth dealing with frankly in view of the special circumstances surrounding it. It is the question of the Korean Customs and the part they must play in the new scheme of things.

A somewhat extensive reference has already been made to Mr. McLeavy Brown, the Chief Com

missioner of Customs, and the autocratic position he occupies. Commanding the personal confidence of the Emperor of Korea and his immediate entourage, well acquainted with all the mysteries of the Palace, the resolute Chief Commissioner is impregnably entrenched in a position of great natural strength which has been further artificially increased by the undeniable diplomatic gifts which Mr. McLeavy Brown possesses. Jealous of the autocratic power he has wielded for many years in Seoul, he is a second Sir Robert Hart in every respect, and has combated no less successfully than his prototype the many intrigues which have been made to unseat him. When the appointment of Mr. Megata was announced it must have aroused no pleasant feelings, for the Chief Commissioner had been most unfairly ousted from the position of Financial Adviser at a time when he was doing excellent work. But, nevertheless, he was fully prepared to meet the new appointee half way, for Mr. McLeavy Brown, like every other sound money man in the Far East, is an ardent Japophil. Mr. Megata, indeed, intimated in his visit of ceremony that the intention of "reciprocating was an idea which he also entertained. But in spite of this preliminary declaration, it required but a short stay in Seoul to see the new Financial Adviser relapse into the shadow-like attitude which is peculiar to the capitals of the Eastern countries and is the first sign that the "atmosphere" has once more proved unconquerable.

Nor is this attitude so hard to explain. The