Page:Bankers and Credit (1924).pdf/172

 put and practically the suggestion of a high Bank Rate was a great improvement on Professor Cannan's bonfire, to be continued till the Bradbury was as good as gold. Nevertheless, there was on the other hand a case to be made for the view that violent action through Bank Rate meant the application, at a time when violent measures were not at all wanted, of a remedy which had been, when gently used, a successful cure for overtrading in different days and under different circumstances. Any bill broker's clerk could have told the Professor that the sudden rise of 2 points in Bank Rate which he desired to see, during the last quarter of the financial year when the big tax payments always leave the market cold and shivery like a fleeced lamb, might very likely have produced panic. A rise of more than a point in Bank Rate was quite abnormal, and might easily have led the City to suppose that all kinds of horrors were upon it. He may have thought that panic was the only way to save us, and this was certainly the view at that time, of certain eminent theorists. But panic is easier to start than to stop.

Without panic Bank Rate seemed at that time most unlikely to produce the desired effect. In old days it had been effective in small doses because profits were finely