What you have is a WW2-era Japanese military katana blade.  Because huge numbers of blades were made during WW2, there are many different types.  They fall into the following general categories:

A) Machine made blades.  These are NCO blades, and have a serial number stamped into them.  If in good condition and with matching scabbard, handle, etc. (furniture) they might be worth around $800

B) Hand-made oil-quenched blades.  These were mass-produced in large numbers, but are technically hand-made, in that each is hand-forged, and signed by the smith.  But, the "smith" could be a prison inmate, who signed the same of the supervising swordsmith.  All will have arsenal stamps.  In excellent condition with matching furniture, one might be worth around $1500 or even more.  

C) Hand-made water-quenched blades.  These were also made in large numbers, but are fully "traditionally" made, just like Japanese blades of centuries past.  This category can get very tricky.  Some might have arsenal stamps, but many will not.  Some might have been made in very small numbers by highly regarded smiths.  As such, value can vary enormously.   In excellent condition, some might be found for as little as $2000 or so (if an unknown smith or with an arsenal stamp), and others could be worth tens of thousands of dollars.

What you have probably falls into category B, but could conceivably be at the "bottom" of category C. Because it has an arsenal stamp, it is likely an oil-quenched blade, and not a water-quenched blade.  But, it is POSSIBLE that it's a traditionally made water-quenched blade.  The only way to be sure is to do further digging into the actual signature on the blade.  If it's a smith who is listed in various reference works, you could possibly get a better idea of whether this was a well-known smith who would have made traditional blades, or not.

Most likely -in my opinion (and remember that I am not an expert, but merely a well informed amateur) - this is probably a mass-produced and oil-quenched blade.  Because it is not in good polish (and may have been subjected to destructive cleaning/grinding), and it doesn't have the correct war-time furniture, the value is not particularly high - I'd say about $800 maybe.  It's one of those things that is obviously worth holding onto if it is a family heirloom, but probably doesn't have much value otherwise.

The problem is that restoring it (i.e. buying/making new furniture and getting it polished), even if done on the cheap, would exceed the value of the blade.

It might be quite difficult to figure out precisely what the original furniture looked like.  To get a general impression, google "gunto katana" or "gunto koshirae" - as you will see, there are numerous variants of what the furniture could look like.  However, a relatively standard army set would probably be quite accurate.

It is possible - perhaps even likely - that the scabbard you have is the original one.  The handle and hand guard certainly are not, and are probably scavenged from another sword.  If the scabbard is original, then a relatively "easy" way to partly restore it is to have a new handle made.  Fred Lohman's company can do that at very reasonable prices.

While I cannot translate the kanji characters on the tang, there ARE helpful people in the internet who will.  There is a nihinto (Japanese sword) discussion group online that has a specific section for identifying swords.  If you take photos of the entire signature (and other markings) and send it to them, theshould be able to tell you who made it ... and should hopefully also give you an idea of how "good" the smith is.



Here's the board:  http://www.militaria.co.za

Once you set up an account, here's the specific sub forum for translating signatures: http://www.militaria.co.za/nmb/forum/15-translation-assistance/