The gold supply and prosperity . ination, and onlyfortuitous circumstances avert trouble. At the mo-ment there comes to hand another protest from theLondon Statist against this disregard of conservativeregulations, instancing the present stringency there asa result of the practice. It is not necessary to furnish a complete catalogueof the illy-fortified financial institutions; those citedprove the need and this is sufficiently important tomerit the persistent attention of the best thought of the 90 GOLD SUPPLY AND PROSPERITY day in governmental and financial circles. It may havebeen excusable
The gold supply and prosperity . ination, and onlyfortuitous circumstances avert trouble. At the mo-ment there comes to hand another protest from theLondon Statist against this disregard of conservativeregulations, instancing the present stringency there asa result of the practice. It is not necessary to furnish a complete catalogueof the illy-fortified financial institutions; those citedprove the need and this is sufficiently important tomerit the persistent attention of the best thought of the 90 GOLD SUPPLY AND PROSPERITY day in governmental and financial circles. It may havebeen excusable in the period of slender gold output topermit reserves to shrink; that excuse is now nolonger permissible; and while there are no doubtother channels in which the extraordinary supply ofyellow metal can be used, none would so readily pre-vent inordinate market fluctuations, at the same timetending to avert the disasters following inadequatereserves, which so frequently interfere with the steadyprogress in our economic JOHN B. CLARK Professor of Political Economy, Columbia University Money, Interest Rates and Prosperity .By Prof. John B. Clark 11—T OW many mistakes we should avoid and howmany perplexing tangles we should straighten,if only we could see clearly how money acts in variousconnections. Interest, business profits, wages andprices all seem to depend on the supply of money, andit is instinctive to conclude that the more there is of itthe better off every one is. Quite natural is it to thinkthat, if the volume of the currency were to grow for-ever larger and larger and if this growth were to out-strip the increase of business to be done by means ofof it, so that prices would rise and continue rising tothe end of time, we should have an ideal conditionfor business, and, in so far as business can ensure it,for general happiness. Let us see what would follow such a permanentincrease in the volume of currency. At the outset ofthe movement producers would get a
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