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PART

can still afford to overlook, are now fatal. Theslump of 1921 was even more violent in theUnited States than here, but by the end of 1922recovery was practically complete. We still, in1925, drag on with a million unemployed. TheUnited States may suffer industrial and financialtempests in the years to come, and they willscarcely matter to her; but we, if we share them,may almost drown.

And there is a further consideration. Beforethe war we had lent great sums to the wholeworld which we could call in at short notice;our American investments made us the creditorsof the United States ; we had a surplus availablefor foreign investment far greater than that ofany other country; with no Federal Reservesystem, American banking was weak and dis-organised. We, in fact, were the predominantpartner in the Gold Standard Alliance. Butthose who think that a return to the goldstandard means a return to these conditions arefools and blind. We are now the debtors of theUnited States . Their foreign investments lastyear were double ours, and their true net balanceavailable for such investment was probably tentimes ours. They hold six times as much goldas we do. The mere increase in the deposits ofthe banks of the Federal Reserve System in thepast year has been not far short of half our totaldeposits. A movement of gold or of shortcredits either way between London and NewYork, which is only a ripple for them, will be anAtlantic roller for us. A change of fashion on