AGEICULTUEAL DEPRESSION, 1873 TO 1887 119 



labour disputes, reductions of wages, and the discharge of 

 operatives. The following year brought no increase of 

 trade, but rather diminished both wages and confidence. 

 Throughout 1877 prices fell; trade shrank and financial 

 disasters became general. But the full extent to which 

 the commercial prosperity of the country was undermined 

 was not suspected till the colossal failures of the Glasgow, 

 South Wales, and West of England Banks in 1878. The 

 country has not yet recovered the blow, although trade now 

 stands on a sounder footing through the drastic purging it 

 has undergone. 



It is impossible to determine what proportion of the 

 existing commercial depression is directly due to the di- 

 minished and diminishing supply of gold. But a diagnosis 

 of the disease detects characteristic signs of a crisis arising 

 out of the gradual decrease of monetary stock. A sudden 

 exportation of cash may produce a short crisis as severe as 

 it is transient. A slow reduction of the stock of money 

 blights and paralyses trade, produces languor, and stifles 

 energies. One puts a pistol to the head of commerce, the 

 other drains its lifeblood. And these signs are accom- 

 panied by an exceptional demand for gold, and a palpable 

 falling off in its supply. Within this period the paper 

 currencies of the United States and European nations 

 were replaced by specie payments. In 1871 the German 

 Empire, which had hitherto adopted the single silver sys- 

 tem, adopted the single gold standard with a subsidiary 

 silver coinage ; America hoarded stores of gold in order to 

 resume metallic money; Sweden, Norway, and Denmark 

 substituted gold for silver in their currency. This drain 

 upon the gold of the world, in addition to the ordinary 

 consumption through wear and tear or works of art, was 

 not met by an increased supply. On the contrary, Sir 



