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 The Chinese saw fit, on political grounds, to boycott Japanese goods, and there was a quick tumble in the Japanese silk market which reacted on America and brought hope to the hearts of millions of consumers, who for years had been fleeced by the bad finance which had debased the currencies of the world, and now at last saw that lower prices were a possibility. But the trade relations of China and Japan certainly were not influenced by the Bank Rate policy of the Bank of England or the United States Federal Reserve Board.

Very interesting evidence on this point was given by the Hon. Benjamin Strong, Governor of the Federal Reserve Board of New York, before a United States Congress inquiry, held in August 1921, apparently because it was claimed that the policy of the Federal Reserve Board had been injurious to American agriculture. Governor Strong told the inquiring Commission how the speculative tendency had, in 1919, worked up into "a veritable orgy of extravagance, waste and speculation; there was in fact competition to buy anything at almost any price. This culminated in the early summer of 1920. Now the first rumblings of a coming break appeared in March and April of 1920, in Japan, where I happened to be travelling. I was there at the height of their