Possibility of break in relations between China and Japan over excessive demands by latter; improvement of Japanese-Soviet relations; authorization of North China-Manchuria air service; unlikelihood of neutralization of Shanghai; defeat of pro-Japanese forces in Suiyuan; German-Japanese accord against Communist International and setback to Japanese-Soviet relations; Japanese-Italian agreement on Ethiopia and “Manchoukuo”; Japanese demonstration at Tsingtao by temporary landing of marines; forced detention at Sian of Generalissimo Chiang, December 12–25; surrender of Chang Hsueh-liang, a ringleader in Sian mutiny; settlement of Chengtu and Pakhoi incidents.