Recent Developments in World Finance
FINANCIAL statistics, while generally more accessible, reliable, and up-to-date than other classes of economic statistics, present only part of picture of economic situation. They cannot be safely interpreted without a knowledge of other economic events and conditions. The attempt to interpret them by themselves is peculiarly dangerous when currency expansion and contraction, changes in commodity prices, and movements of foreign exchange are as violent as they have been in most countries since close of Great War. The present writer therefore vigorously dissents from so-called dictum of finance that position of a central bank of issue accurately reflects economic condition of a country, barring mismanagement of bank's business; I from view that the depreciation of exchanges of various countries roughly reflects economic deterioration of each; 2 and from conclusion that recent financial facts evidence a European decadence which threatens civilization. I On contrary, one who studies whole evidence from Europe since armistice can hardly escape conclusion that fundamental and important economic progress may take place in face of objectionable policies of government finance, rising public debts, severe depreciation of a currency, and a falling rate of exchange; and that central bank showings may improve and exchange rates may rise without necessarily signifying or even forecasting fundamental economic improvement. The present article, like writer's previous general surveys in this REVIEW, deals primarily with certain financial aspects of world's economic developments. It is written, however, in light of considerable evidence upon fundamentals of agriculture, transportation, industry, and trade which cannot here be set forth in detail. Unfortunately it is difficult for any one person to gather and assimilate adequate evidence of this kind from diverse sections of our still disorganized economic world; and too often one must present a judgment based upon partial evidence rather than a conclusion from a convincing array of facts. Suffice it to say that writer has attempted to obtain a fair perspective, and that readers must supplement and check that perspective by their own.4
- DOI
- 10.2307/1924554
- Volume
- 4 (2)
- Pages
- 62
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