ESSAYS IN PERSUASION

PART

I76

interposed their guarantee. They stand betweenthe real borrower and the real lender. They havegiven their guarantee to the real lender; andthis guarantee is only good if the money valueof the asset belonging to the real borrower isworth the money which has been advanced on it.

It is for this reason that a decline inmoney values so severe as that which we arenow experiencing threatens the solidity of thewhole financial structure. Banks and bankersare by nature blind. They have not seen whatwas coming. Some of them have even wel-comed the fall of prices towards what, in theirinnocence, they have deemed the just and“natural” and inevitable level of pre-war, thatis to say, to the level of prices to which theirminds became accustomed in their formativeyears. In the United States some of them em-ploy so-called “economists” who tell us evento-day that our troubles are due to the fact thatthe prices of some commodities and someservices have not yet fallen enough, regardlessof what should be the obvious fact that theircure, if it could be realised, would be a menaceto the solvency of their institution. A “sound”banker, alas! is not one who foresees dangerand avoids it, but one who, when he is ruined,is ruined in a conventional and orthodox wayalong with his fellows, so that no one can reallyblame him.

But to-day they are beginning at last to takenotice. In many countries bankers are becomingunpleasantly aware of the fact that, when their