earlier stages of a given period of inflation a liquidation could be brought on only by some relatively violent disturbance, whereas at a higher phase of speculative inSation a relatively alight disturbance would suflBce.
Now, it takes some time for such a speculative movement to bring on so large a discrepancy between capitalization and eaming-capacity as may not be adjusted by other means than a widespread and severe liquidation.' Hence a rough periodicity in the recurrence of these seasons of buoyancy and of collapse in capitalized values. Other factors, and varying ones, have, no doubt, been present in each of the historic crises of the nineteenth century, and these other factors would have to be taken due account of in any history of crises, and even in any theory of crises, which aimed at anything like an exhaustive treatment ; but the factors here pointed out seem to be the characteristic and constant ones in the sequence of crises within this period, at the same time that they are the factors which are in a peculiar degree connected with that process of business management in modem industry which is the objective point of the present inquiry.
Since the seventies, as an approximate date and
' The ■peoolatiTe moremeiit reqnirea time, because tbe fnflaUoti la a oamatatiTe one and is carried out uniuteutionally and In a ■ nncotuidouBly,
THE THEORY OF MODEBN WELFARE 251
as applying particularly to America and in a less degree to Great Britain, the course of affairs in business has apparently taken a permanent change as regards crises and depression. During this recent period, and with