unprofitable even if it has been conservatively planned. There are also, of course, fraudulent enterprises which are not expected by their promoters to pay a profit on the investment ; and there are probably, also,
1 For the preMnt purpose a, conrem nhich passes tbrongh & liquidation and re&ppean with a rerat«d and reorgnnized capitalization and body nf llabllltlea also has much of the character ol a n«w ioTeilmenl.
220 THE THEORY OF BC8I>'E8S ESTERPRISE
always some ventares entered upon duiing doll times with a view to being beforehand in preparation for better times. But after all has been aaid in qualification of the main proposition, it remains true that some new investment is going on with a well-advised expectation of reasonable profits on the basis of current costs, prices, and rates of interest.'
The rate of interest in times of depression may be unsatisfactory to lenders; it may be discouraging by comparison with the customary range of interest rates during better times. Still, the obstacle to business is not to be sought in an effectual discouragement of lenders, for in point of fact money
' Cf. L. Pohle, BevSlkerungtbniKgvng, Sapitalbitdung und ptrSoddiche WlrltchaJUkriien, who concludes that depremiou la due ui » scarcity ot capital u compared with population ; the raw of iocre&ae of capital Is conceived to fall shortof the ral«ot increase of populatioii, bence periodical deprcMlon.
Cf.. on the other hand, Macrotty, TrutU and the State, p. 133, who finda, by recourse to the (estimony before the Royal Commiaalon on the Deprewion of Tnida and Industry, that there I« at such timea capital constantly seeking investinent and ent«rlaf into competition with what is already Invested. CI. Final Report of the Soyal CotHmiaton on