for successful candidates at the senior and middle grade intermediate examinations. As an answer to this scheme, of which the Roman Catholic hierarchy very strongly discouraged young persons of their faith from taking advantage, a project was started with much generosity by the Roman Catholic prelates themselves, and developed by a joint committee of ecclesiastics and laymen, for the establishment immediately of at least twelve substantial scholarships in connection with the Royal University, to be held by boys at the Roman Catholic University College in Dublin, and by girls at either of two female schools in that city. They were to be awarded on the results of senior grade intermediate examinations. It was hoped and expected that the number of scholarships would be largely increased by the liberality of the faithful.

Agriculturally the year in Ireland was distinctly satisfactory. The crops generally were well above the average. The potatoes, though there was a groundless momentary scare about them, turned out very well, and all the better, certainly, for the persistent spraying which under the inspiration of the Agriculture Department is, when the need arises, applied more and more widely. Grazing conditions also were favourable and cattle raising took further developments. The linen industry of Belfast had a twelvemonth of activity improving during its course, and appeared to have a cheerful outlook, only qualified by uncertainty in regard to the supplies of flax, especially from Russia. The home acreage in flax, however, reached 46,153 as compared with 44,293 in 1904-a gratifying change from the previously recorded downward progress. The shipbuilding and marine engineering industries of Belfast, though their output was not as large as in one or two recent years, showed the impressive total of twenty-one steamers, 143,477 tons, and 115,281 horse-power-the last figures including the engines for H.M. first-class battleship, Hibernia.

SUPPLEMENTARY CHAPTER.

FINANCE AND TRADE IN 1905.

No year is perfect from the trade point of view, but there have been few years which have upon the whole been so satisfactory as 1905. It has been marked by a revival after the period of dulness which had characterised most industries since the South African War. And the revival has been almost world-wide. Trade is now of so international a character that no country can be prosperous by itself; its prosperity permeates others. Agriculture, as always in the history of the world, is the essential basis of prosperity, and to the abundant products of agriculture we trace the revival of 1905. The enormous American cotton crop of 1904 made it certain that the great cotton spinning and

weaving industry, in which Lancashire takes so prominent a part, would have ample raw material for all its requirements. Then followed bountiful harvests in Canada, the United States and Argentina, and the wave of prosperity began to flow to Europe. Almost every important country has done well. Great Britain, France, Germany, Austria and Italy have had much upon which to congratulate themselves. Canada and the United States have enjoyed the finest industrial years in their history. Russia is, of course, a black spot owing to the war drain and the internal disturbances. Japan must suffer for some years from the financial strain of a great war, but for the moment she enjoys much improved credit, and is coming to be regarded as a "four per cent." country. Athough the war in the Far East caused a large special demand for South Wales coal, clothing, provisions and other stores, and benefited many British and Continental industries, yet war business always has to be paid for rather heavily, since the waste far exceeds the commercial profit. Trade is diverted from its normal course, and the slow return is accompanied by much pain.

In Great Britain the revival began from outside, and was first felt in the foreign trade; in fact, the foreign trade was fairly prosperous in some departments in 1904 when the home. trade had hardly begun to stir itself. In 1905 the British exports passed all records, and during the last six months of the year activity in the home demand for many important products was distinctly marked. The textile trades, especially cotton, have done best, and next to these have come the great iron and steel trades. The total imports of Great Britain in 1905 were valued at 565,279,4021., an increase of 14,240,774l., or of 2.5 per cent. Exports of British and Irish produce advanced by no less than 29,312,4271., or 97 per cent., to 330,023,4671., and the re-exports of Colonial and foreign merchandise showed the highly satisfactory increase of 7,494,240l. to 77,798,5211. The bulk of the increase in exports was under the head of "articles wholly or mainly manufactured," the increase in this item being 26,133,8631. (10.7 per cent.). The cotton trade was responsible for a considerable portion of the increase, since the exports of yarn and cloth far surpassed all records, especially to India and China. Woollen goods and iron and steel manufactures also showed very substantial increases. As against these advances in exports of manufactured goods, the imports of articles in the same general category increased by 7,409,3391. only, of which 1,769,8471. was re-exported. Measured by the partial test of expansion in exports of manufactured goods in comparison with the increase in imports, the year 1905 was one of the best periods in her foreign trade which Great Britain has ever known. But it should be understood that tests of this kind are at the best rough indications of prosperity, and that both the home and foreign trades must be surveyed in detail before any one can offer a trustworthy judgment.

One of the most certain signs of reviving trade is an internal demand for "money," in other words for credit, and this demand was experienced during the greater part of the year, and especially in the latter part. The Money Market had arrived at normal conditions after the long disturbance caused by the South African War, and during the first nine months the Bank rate did not exceed 3 per cent. A foreign drain necessitated an advance to 4 per cent. in September, but the average rate for the whole year was only 3 per cent., so that industrial requirements were supplied on very moderate terms. Cheapness of money is a most important factor in modern trade, which is conducted largely on short credits, and stringency at an inconvenient time may be enough to stifle a promising revival. Had the foreign demand for gold in the early autumn been prolonged we might have seen a serious period of " dear money,' but happily this demand soon became less important, and the Bank of England was able to secure and keep part of the large arrivals from South Africa. The mines of the Rand, which during 1905 yielded no less than 20,800,000l., as compared with 16,000,000l. for 1904, were of the greatest service in adding to the world's supplies of gold, and it is this service-apart altogether from the question of dividends on gold mining shares -which gives to the Rand its international importance. While for various reasons the returns of the Bankers' Clearing House are not a perfect measure of the country's trade, still the expansion in the London clearings of 16.3 per cent. and in the country clearings of 5.2 per cent. affords substantial evidence of the increased business which was passing during 1905.

In the Stock Exchange the year was a chequered one, but on the whole satisfactory. The American Continent had a "boom," or something much resembling one. North, South and Central Americas have been extraordinarily prosperous, and this has been reflected in the prices of railway and other shares and stocks. In Canada the securities of the big railways and of the Hudson's Bay Company have been buoyant, and many of the United States and South-American railways have "blazed "in astonishing fashion. To take one or two examples. Union Pacific common stock advanced by 37 to 155, Reading common by 30% to 71, Argentine Great Western Railway ordinary stock by 25 to 130, San Paulo Railway ordinary stock by 23 to 205, and Antofagasta and Bolivia Railway deferred stock by no less than 167 to 310. United of Havana Railway stock also made a sensational advance of 86 to 209. The whole American Continent, north and south, was practically free from political disturbances, and was able to develop its abundant natural wealth in security.

When from the great advances seen in the West we turn towards home the record is much less exciting. British Government securities were practically unchanged-the price of Consols being 89 at the end of the year as against 881 at the begin

ning. Among Foreign Government securities the features have been the rise of Japan and the fall of Russia. At the beginning of 1905, in spite of considerable victories on the part of Japan, her enemy enjoyed the greater financial credit; Russian Four per cents. stood at 914, while those of Japan were only quoted at 76. But the complete success of Japanese arms, together with the internal disturbances in Russia, reversed the position of the two countries in financial eyes. By the end of the year Russian Fours had fallen to 821 while those of Japan had made an advance of no less than 161 to 923. It is the more remarkable that the securities of Japan should have been in so great demand since her borrowings on account of war expenses were on an unprecedented scale and were immense in comparison with the peace budgets of that country.

It will be of interest here to place on record the war loans raised by Japan at home and abroad to carry on the operations against Russia. At first she was financed abroad by Great Britain and America, while Russia had the support of France and Germany. But when the success of Japan became certain and Russia's finances crippled, both France and Germany withdrew assistance from their European neighbour and were eager to take part in Japan's latest issues. During the war Japan borrowed abroad 82,000,000l. sterling, 22,000,000l. of which carried 6 per cent. interest and the remainder 4 per cent. Immediately after the war she floated a foreign conversion loan of 50,000,000l. at 4 per cent., of which only 25,000,000l. was actually issued, and the balance retained to convert the Six per cents. at maturity in 1907. In addition to the foreign debt 48,000,000l. were borrowed internally-20,000,000l. at 6 per cent. and 28,000,000l. at 5 per cent. If one takes the conversion operations as completed, the total debts contracted on account of the war will stand at 138,000,000l.-foreign 110,000,0001. and domestic 28,000,000l.-requiring an annual charge for interest of 6,100,000l. As a sequel to the war a further domestic debt of 37,000,000l. sterling will be issued. Figures such as these would be large in the case of any country, but when one observes that the normal revenue of Japan, exclusive of war taxes, does not exceed 23,500,000l. per annum, they appear to be stupendous. Nevertheless the principal monetary centres of Europe and America have confidence in Japan's ability to bear this debt and to redeem it in due course.

It was as a commercial rather than a financial year that 1905 will be remembered. One of our greatest single industries--the Lancashire COTTON trade-had by far the most prosperous year in its history. During the "short time" worked during part of 1904 the demand for cotton yarn and cloth outstripped the supply, so that when, towards the close of the year, a bountiful supply of American raw cotton was forthcoming, our spinners and weavers were able to contract a year or more ahead at prices which yielded ample margins of profit. The American crop pro

duced more than 13,500,000 bales (of 500 lb. each), or 2,000,000 bales more than the world's requirements. Raw cotton was therefore both plentiful and cheap during the early months of 1905, and remained so until the prospects of a much smaller crop for the following season caused speculators to force up prices. Our exports of cotton yarn exceeded those of the previous year by 25 per cent. and those of cotton cloth showed an increase of 11 per cent. The profits made by both spinners and weavers in Lancashire were huge. Ninety spinning companies showed an average profit of 19 per cent. on their share capital, and the rush to build new mills caused the equipment of sixtysix factories at a cost of about 7,000,000l. sterling. Whether these new mills will pay is another question; their appearance is already causing the spinners to be afraid of overproduction of yarn, and the advance in the price of raw material during the latter part of the year has made the margin of possible profit rather narrow. For the time, however, the cotton industry continues to enjoy unexampled prosperity, and to this fact must no doubt be attributed the strong opposition of Lancashire to the fiscal proposals of Mr. Chamberlain.

In the other great textile industry-WOOLLENS and WORSTEDS -there was recovery, but not to anything like the extent of that which I have reported in cotton. Raw wool remains comparatively scarce on account of the reduction in the Australian flocks, due to the late drought there, and though the Australian production is rapidly increasing it has not yet caught up with the demand. This demand, both at home and in America, ran up the price of wool, and though business in the woollen centres increased considerably the prices of the finished products have not advanced in proportion to the advance in raw wool. Exports of woollen and worsted yarns and fabrics increased by nearly 2,500,000l. sterling, nearly half the increase being caused by the demand from Japan and China for clothing, blankets, etc., in connection with the military operations in Manchuria. America was a large purchaser of British goods, a feature which was of interest in view of the high tariffs in force in the United States.

The METAL industries did not flourish to the same extent as the cotton trade, but their advance was nevertheless notable. Shipbuilding in British and Irish yards was extraordinarily active, especially just after the close of the Russo-Japanese War, and the actual tonnage of the steamers launched constituted a "record" for British yards. The tonnage was 1,811,000 as compared with 1,376,000 in 1904. A check was caused in the orders of new mercantile steamers by the rapid rise in the price of iron-and consequently of steel ship plates-an advance so great that the cost of new steamers ordered in September was fully 20 per cent. higher than that of corresponding vessels ordered a year before. While some of the new steamers represented large liners-such as the great turbine steamer Carmania -the greater part consisted of cargo tramps which must com