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ESSAYS IN PERSUASION

PART

Those of the very highest grade have, indeed,risen slightly, or, at the worst, not fallen by morethan 5 per cent, which has been of materialassistance in some quarters. But many otherfixed interest securities, which, while not of thehighest grade, were, and are, good securities,have fallen from io to 15 per cent; whilstforeign government bonds have, as is wellknown, suffered prodigious falls. These de-clines, even where they are more moderate, maybe scarcely less serious, because such bonds(though not in Great Britain ) are often ownedby the banks themselves outright, so that thereis no “margin” to protect them from loss.

The declines in the prices of commoditiesand of securities have, broadly speaking,affected most countries alike. When we cometo the next category of property—and one ofgreat quantitative importance — namely, realestate, the facts are more various as betweenone country and another. A great element ofstability in Great Britain , and, I believe, inFrance also, has been the continued compara-tive firmness in real estate values:—no slumphas been experienced in this quarter, with theresult that mortgage business is sound and themultitude of loans granted on the security ofreal estate are unimpaired. But in many othercountries the slump has affected this class ofproperty also; and particularly, perhaps, in theUnited States , where farm values have suffereda great decline, and also city property of modernconstruction, much of which would not fetch