International Finance

and trade, we have gone a long way towards seeing the greatness of the se

fying their immediate wants and cravings for comfort and enjoyment It is equally, perhaps still more, true, that we owe them to the brains and energy of those who have planned and organized the equipment of industry, and the thews and sinews of those who have done the heav

h as our forefathers could never have imagined. It is true that at the same time we have benefited others, besides our own customers and debtors. We have opened up the world to trade and other countries reap an advantage by being able to use the openings that we have made. It is sometimes argued that we have in fact merely made the paths of our competitors straight, and that by covering Argentina with a network of railways and so enormously increasing its power to grow things and so to buy things, we have been making an opportunity for German shipbuilders to send liners to the Plate and for German manufacturers to undersell ours with cheap hardware and cotton goods. This is, undoubtedly, tru

assed into the hands of the final consumer. But there is also the indirect advantage that we gain, as a nation of producers and financiers, from the growing wealth of other nations. The more wealthy they grow, the more goods they produce want to sell to us, and they cannot sell to us unless they likewise buy from us. If we helped Germany to grow rich, we also helped her to become one of our best customers and so to help us to grow rich. Trade is nothing but an exchange of goods and services. Other countries are not so philanthropic as to kill our trade by making us presents of their products and from the strictly economic point of view, it pays us to see all the world, which is our market, a thriving hive of industry eager to sell us as as it can. It may be that as other countries,

the resources of other countries, through the machinery of international finance, enable us to sit at home in this inclement isle, and enjoy the fruits of tropical skies and soils. It may be true that if they had not done so we should have developed the resources of our own country more thoroughly, using it less as a pleasure ground, and more as a farm and kitchen garden, and that we should have had a larger number of our own folk working for us under our own sky. Instead of thriving on the produce of foreign climes and foreign labour that comes to us to pay interest, we should have lived more on home-made stuff and had more healthy citizens at work on our soil. On the other hand, we should have been hit hard by bad seasons and we should have enjoyed a much

hey will maintain, towards the improvement in their lot which is so long overdue. It has helped the farmers, put fortunes in the pockets of the shipowners, and swollen the profits of any manufacturers who have been able to turn out stuff wanted for war or for the indirect needs of war. The industrial centres are bursting with money, and the greater spending power that has been diffused by war expenditure has made the cheap jewellery trade a thriving industry and increased the consumption of beer and spirits in spite of restrictions and the absence of men at the front. Picture palaces are crammed nightly, furs and finery have had a wonderful season, any one who has a motor car to sell finds plenty of ready buyers, and second-hand pianos are an article that can almost be "sold on a Sunday." But in the midst of this roar of humming trade, finance, and especially international finance, lies stricken and still gasping from the shock of war. When war comes, the price of all property shrivels. This was well known to Falstaff, who, when he brought the news of Hotspur's rebellion, said "You may buy land now as cheap as stinking mackerel," To most financial institutions, this shrivelling process in the price of their securities and other assets, brings serious embarrassment, for there is no corresponding decline in their liabilities, and if they have not founded themselves on the rock of severest prudence in the past, their solvency is likely to be imperilled. Finance knew

od business and as little as possible disturbance in the orderly course of affairs. Such a cataclysm as the present war could only terrify them, especially those with interests in every country of the world. When war comes, especially such a war as this, financing in its ordinary and most profitable sense has to put up its shutters. Nobody can come to London now for loans except the British, or French, Governments, or, occasionally, one of our colonies. Any other borrower is warned off the field by a ruthless Committee whose leave has to be granted before dealings in new securities are allowed on the Stock Exchange. But when the British Government borrows, there are no profits for the rank and file of financiers. No underwriting

thered by any breath of popular prejudice, is rather a comforting evidence of the slight importance that mankind attaches to the question of its bread and butter. It is clear that a purely material consideration, such as the interests of international finance, and the desire of those who have invested abroad to receive their dividends, weighs very little in the balance when the nations think that their honour or their national interests are at stake. Since the gilded cords of trade and finance have knit all the world into one great market, the proposition that war does not pay has b

sk for the exertion of force on its behalf. As private citizens we all of us want to live at peace with our neighbours, but if one of them steals our property or makes a public nuisance of himself, we sometimes want to invoke the aid of the strong arm of the law in dealing with him. Consequently, although it ca

he War of Steel and Gold," and by other writers, to show that our diplomacy is the tool of international finance, and that the forces created by British taxpayers for the defence of their country's honour, are used for the sordid purpose of wringing interest for a set of money-grubbers in the City, out of a poor and down-trodden peasantry overburdened by the exactions and extortions of their rulers. Mr. Brailsford, of course, puts his case much better than I can, in any brief summary of his views. He has earned and won the highest respect by his power as a brilliant writer, and by his disinterested and consistent championship of the cause of honesty and justice, wherever and whenever he thinks it to be in danger. Nevertheless, in this matter of the Egyptian war I venture to think that he is mistaking the tail for

a firm foot on the banks of the Nile, and sit in the seats of the Faithful, and still that sleepless rock will lie watchin

r taking its seat in Egypt and sitting there ever since. The bondholders were certainly benefited, but it is my belief that they might have whistled for their money until the crack of doom if it had not been that their claims chimed in with Imperial policy. It may have been wicked of us to take Egypt, but if so let

aid they wanted a vote and that Mr. Kruger would not give them one. That acute political thinker, Mr. Dooley of Chicago, pointed out at the time that if Mr. Kruger "had spint his life in a rale raypublic where they burn gas," he would have given them the votes, but done the counting himself. But Mr. Kruger did not adopt this cynical expedient, and public opinion here, though a considerable minority detested the war, endorsed the determination of the Government to restore the disputed British suzerainty over the Transvaal into actual sovereignty. Subsequent events, largely owing to the ample self-government given to the Transvaal immediately after its conquest, have shown that the war did more good than harm; and the splendid defeat of the Germans by the South African forces u

be a good deal more so if mankind had made better progress with the much more difficult problem of using and distributing its wealth. If the rapid increase of wealth merely means that honest citizens, who find it as hard as ever to earn a living, are to be splashed with more mud from more motor-cars full of more road hogs, then there is little wonder if the results of international finance produce

the Six Power Group in China meant that the financial strength of England and France had to be shared, for political reasons, with powers which had, on purely financial grounds, no claim whatever to participate in the business of furnishing capital to China. The introduction to the 1898 edition of "Fenn on the Funds," expresses the view that our Government is ready to protect our traders abroad, but only helps investors when it suits it to do so. "If," it says, "a barbarian potentate's subjects rob a British trader we never hesitate to insist upon the payment of liberal compensation, which we enforce if necessary by a 'punitive expedition,' but if a civilized Government robs a large number of British investors, the Government does not even, so far as we know, enlist the help of its diplomatic service. Only when, as in the case of Egypt, there are important political objects in view, does the State protect those citizens who are creditors of foreign nations. One or two other countries, notably Germany, set us a good example, with the best results as far as their investors are concerned." Germany is often thus taken as the example of the State which gives its financiers the

furthering its political greatness and diplomatic prestige. Man is a jumble of contradictory crotchets, and it would be difficult to find anywhere a financier who lived, as they are all commonly supposed to

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