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THURSDAY, MAY 19, 1938
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AUSTRALIA'S CHOICEST
BUTTER
HSUCHOW REPORTS CAUSE EXCITEMENT
Contradictions In Japanese Victory Claims
-JAPANESE
HSUCHOW CLAIMS
Shanghai, To-day. According to Japanese claims received in Shanghai, the Ja- panese have captured the whole of Hsuchowfu except for the southern section, where fierce hand-to-hand fighting is raging. -Reuter.
CITY VIEW OF WEAKENING OF
CHINESE DOLLAR
London, To-day.
Confirmation Of ITALO-FRENCH Entry Still Lacking NEGOTIATIONS
Shanghai, To-day.
Great excitement has been aroused here by Japan- ese claims to the capture of Hsuchow, although there is strong disposition to regard the re- ports as premature.
J
+
SUSPENDED
Paris, To-day.
Franco - Italian negotiations
have been suspended until fur- yesterday evening.
ther, notice, Trans-Ocean learned
The French Charge d'Affaires,
Japanese statements are themselves contradictory. The communique claiming that Hsuchow had been entered at three points, was followed by a statement by the Japanese spokesman to the effect that "the Chinese defence is very stub-ceived yesterday by the Italian born so that a decision in the battle for the pos- session of Hsuchow will probably be delayed."
It is known that the area sur- rounding Hsuchow is honeycomb- ed with pill-boxes, capable of en- filading fire and holding up mass infantry assaults for a consider- able time.
The Japanese allege, however, that Chiang Kai-shek's highly
CHANGPING RETAKEN
Chengchow, To-day.
M. Blondel, was to have been re-
Foreign Minister, Count Ciano,, who, however, sent a notice to
M. Blondel that he could not grant the interview.
When M. Blondel inquired whe- ther the conversations could be held on Thursday, he received the answer that Italy would resume negotiations with France · only when the smuggling of arms and ammunition over the French fron-
trained troops have been with- Changping, northwest of Pei-tier had ceased. - Trans-Ocean.
*
stated that Chinese Peace Preser- of Tientsin, have revolted against, Cen- vation Corps units in eastern the bogus government. Hopei and Yungtsing, northwest tral News.
In a leading article on the de-drawn to Kweiteh and Kaifeng ping and east of Nankow, has fault OR the Shanghai-Nanking and that the troops left in the been recaptured by the Chinese. sector, probably some 150,000 Another report received here Railway bonds and the weakness are recruited mostly from the of the Chinese dollar, the "Finan- provincial armies.
"CITY WALLS” cial News" says that any assump-
At noon to-day a communique tion that the Chinese economic stated that the west and north system is becoming so impoverish-stations in Hsuchow were in Jap- ed that further prosecution of the may be soon impossible, is certainly premature.
war
anese
occupation, while the troops from Pawangshan 'are at the gates. Japanese reports con- tinue to refer to city walls, which] the Chinese deny exist.
The most that the weakening of The reports say that fighting the dollar means is that the on the remaining fronts is of Government will have to pay more minor importance, since the Jap- for supplies of war material, and anese supreme command is con- it cannot mean that the end of Chi-centrating all available resources nese resistance is near.
on the attacks against the west outskirts of Hsuchow.
All signs point to a protracted struggle lasting, perhaps, years, and the implications in this for the economic system of Japan are very serious.
TOKYO BUDGET DEFICIT
The size of the Budget deficit is already staggering, and although totalitarian economy can bear tremendous strain, it cannot inde- finitely finance expenditure of such magnitude,
#
The implications for China, too, are far-reaching. Fighting a long war on guerilla and partisan lines might well lead, especially if the Chinese ultimately are successful, to recrudescence of nationalist feeling and emergence of a more united China-Reuter.
The position along the Lung- hai Railway west of Hsuchow ap- pears to be that the Japanese in- | filtrations which reached the line have been effectively disposed of. Reliable information on the exact situation at Hsuchow is still lacking. Our Own Correspon- dent.
CLOUDY, SHOWERY
The Royal Observatory reports that a weak anticyclonic area has developed to the north of the Yang- tao Valley and a depression is mov- ing eastward across the Sen Japan.
of
Pressure continues to be low over. Indo-China.
Local forecast;-S. to E winds, moderate; cloudy, showery,
Be sure the name
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