qualified to judge as to the reasonableness of the general level of prices."
Quite so, and this being so, it should surely have been possible to warn speculators and the public and all other parties concerned that prices are regarded as too high, by some less expensive method than the one which involved selling cheap Treasury Bills at the expense of the taxpayer and making the real producer and trader pay more for money in order to convey a roundabout warning to the speculator which he blandly ignored until a Chinese boycott of Japanese goods upset the silk market and tumbled over the whole house of cards. In old days when Bank Rate went up it meant that a gold drain was occurring or expected and a gold drain meant that there was less money in the country, and that borrowers whatever price they liked to pay, would have to have less. And so it was a very real warning. In 1919 and 1920 there was no question of a gold drain, and rises in Bank Rate, whatever other effects they may have had, certainly did not cause contraction of credit.
Just consider these few facts. Bank Rate was 5 per cent. when the war ended in November 1918. It rose to 6 per cent. in November 1919, 7 per cent. in April 1920 and stayed there until April 1921, then declining
