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 the part of buyers of Treasury Bills made it necessary to tempt them with the bait of the lower price that is implied by the higher rate of discount. The export of gold having been forbidden, save under licence, fear of a foreign drain on the Bank of England's Reserve could not be alleged as the cause of this eccentric movement.

Bank Rate was thus recognized as a moral weapon to bring back to its senses a country given over to an unwholesome fever of speculation. Rapid deflation was the order of the day. Contraction of credit and currency was to be secured by rising rates for money and was to bring about a rapid fall in prices that seemed to great minds to be the logical sequel and correction of the previous rise. The ideal aimed at had been very forcibly expressed by one of our most distinguished economists, Professor Cannan, who had observed in the Introduction to his Paper Pound of 1797—1821, published in 1919, that "when the scales at last fall from the eyes of the people of Europe, groaning under the rise of prices, they will no longer cry to their Government, 'Hang the profiteers,' but 'Burn your paper money and go on burning it till it will buy as much gold as it used to do!

To minds mathematically inclined and