Estimate of the Situation: Pacific - Far East Note by Sec.

and possible division among the United Nations, which would enable her to conclude a satisfactory peace. Although Japan will continue to use caution in the employment of her air power and especially her battle fleet, we believe, nevertheless, that Japan now intends to make vigorous efforts to resist any further Allied penetration of the line Kuriles-Bonins-Marianas-Palau-Vogelkop. Her ground forces will offer maximum resistance at all points with little regard for losses, her air power will be committed to a scale of defence proportionate to the strategic importance of the area, and her battle fleet will attack should local circumstances develop which seem to offer opportunity for an effective blow.