Ill

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ing or contracting credit; with this difference,however, that Mr. McKenna would look chieflyto the level of employment, whilst Mr. Good-enough would be more influenced by the sta-bility of internal prices. “To sum up myviews on the currency question,” the latter says,“I feel that our aim should be to maintainas nearly as possible the existing equilibriumbetween currency and commodities. . . .”Neither of them, however, would be much dis-turbed by a moderate rise of prices, provided(in the case of Mr. McKenna) that the produc-tive resources of the country had not yet reachedthe limit of their capacity, and (in the case ofMr. Goodenough) that the rise was due neitherto the speculative withholding of commoditiesnor to British prices rising relatively to Ameri-can prices. About our ultimate objective,Mr. McKenna does not speak; but there isnothing in his speech to suggest that he wouldnot be in favour of pursuing permanently thepolicy, which he recommends for the present,of “steering a middle course between Inflationand Deflation,” i.e. of aiming, like Mr. Good-enough, at a general stability of prices withincertain limits, and of deliberately employingmonetary policy to mitigate the evils of thecredit cycle: “Ups and downs in trade we arebound to have, but wise monetary policy canalways prevent the cyclical movement fromgoing to extremes. The speculative excessesof an inflationary boom and the cruel impover-ishment of a prolonged slump can both be