CH. 12 LONG-TERM EXPECTATION 159

influence of speculation (in the above sense) is enormous.Even outside the field of finance, Americans are apt tobe unduly interested in discovering what averageopinion believes average opinion to be; and thisnational weakness finds its nemesis in the stock market.It is rare, one is told, for an American to invest, as manyEnglishmen still do, “for income”; and he will notreadily purchase an investment except in the hope ofcapital appreciation. This is only another way of sayingthat, when he purchases an investment, the Americanis attaching his hopes, not so much to its prospectiveyield, as to a favourable change in the conventionalbasis of valuation, i.e. that he is, in the above sense, aspeculator. Speculators may do no harm as bubbles ona steady stream of enterprise. But the position isserious when enterprise becomes the bubble on a whirl-pool of speculation. When the capital development ofa country becomes a by-product of the activities of acasino, the job is likely to be ill-done. The measureof success attained by Wall Street, regarded as aninstitution of which the proper social purpose is todirect new investment into the most profitable channelsin terms of future yield, cannot be claimed as one of theoutstanding triumphs of laissez-faire capitalism—whichis not surprising, if I am right in thinking that the bestbrains of Wall Street have been in fact directed towardsa different object.

These tendencies are a scarcely avoidable outcome ofour having successfully organised “liquid” investmentmarkets. It is usually agreed that casinos should, inthe public interest, be inaccessible and expensive. Andperhaps the same is true of Stock Exchanges. Thatthe sins of the London Stock Exchange are less thanthose of Wall Street may be due, not so much to differ-ences in national character, as to the fact that to theaverage Englishman Throgmorton Street is, comparedwith Wall Street to the average American, inaccessibleand very expensive. The jobber’s “turn”, the high