Ml 



DISCOVERY 



It may be said that it is absurd to try and give 

 sonic idea of the importance of the discovery of the 

 rarer metals in so short an article, when each metal is 

 almost capable of yielding a little romance of itself ; 

 but in a magazine for general readers it is hardly 

 the business of a writer to dive too deeply into his 

 subject, but rather to suggest the vastness of the 

 subject with which he is dealing. Of the magnitude 

 of the importance of these rarer metals in our modem 

 life there can be but little doubt, and this is reflected 

 in the enormous number of books which have appeared 

 on the subject in one or other of its branches in prac- 

 tically all languages. The four books mentioned below 

 will give the reader a fuller insight into the various 

 branches of the rarer-metal industry. 



Monographs on Inorganic and Physical Chemistry. The 



Metals of the Rare Earths, by J. F. Spencer. (Longmans, 



Green & Co., 1919. 12s. 6d.) 

 Manuals of Chemical Technology. The Rare Earth Industry, 



by Sidney J. Johnstone. (Crosby, Lockwood & Son, 



1915. 9s) 

 The Mineralogy of the Rarer Metals, by Edward Cahen and 



W. O. Wootton. (Charles Griffin & Co., 1920. Second 



edition just published, los. bd.) 

 Die Darstellung der Sellenen Erden, by C. Richard Bohm. 



(Leipzig, 2 vols., £z 2S. od.) 



Outstanding Economic 

 Problems 



By Douglas Knoop, M.A. 



Head of the Department of Economics in tlic Vniucrsiti; of Slieffield 



So far as this country is concerned, there appears to 

 most people to be one outstanding economic problem 

 at the present time — the problem of high prices. 

 Really the problem is something much wider : it is 

 like a jewel with many facets. The particular facet 

 which we most commonly observe reveals high prices 

 to us. Another facet, however, shows us scarcity. 

 This, for example, is the way the housing problem 

 presents itself to us ; it is not so much a question of 

 high rents, but of shortage of housing accommodation 

 which impresses itself upon us. The aspect of scarcity 

 is also felt, though to a less marked degree, in con- 

 nection with butter and sugar, and with motor-cars 

 and motor-cycles. Scarcity and high prices are always 

 associated together ; the competition of would-be 

 buyers seeking to obtain the limited supplies drives 

 up the prices. But with the principal exception of 

 housing, pubhc attention here is much more con- 

 centrated on the high prices than on the scarcity 



aspect of the problem. This is perhaps partly because 

 effects are more easily seen than causes, but partly 

 because the high prices appear to be out of all pro- 

 portion to the scarcity. This leads u? to examine 

 some other facets of our jewel. One facet reveals 

 that a special reason for high prices can be found in 

 the existence of too much paper money, or currency 

 inflation, as it is commonly called. Another facet 

 shows us the closely related phenomenon of the 

 Government relying too largely on advances from 

 banks, and other forms of temporary borrowing, 

 instead of financing itself by means of tax revenue 

 and long-dated loans subscribed for out of the savings 

 of the citizens. Excessive temporary loans, like 

 excessive issues of paper currency, tend to raise 

 prices. Still another facet reminds us of the fact 

 that, when we try to buy foreign currency in order 

 to pay for goods purchased abroad, our pound in 

 many cases no longer has its old power in exchange. 

 This is particularly detrimental to us in the case of 

 purchases made in the United States — our chief 

 source of supply — where our (paper) pound is worth 

 only about 3I dollars instead of the normal 4j| dollars. 

 Canada and India are two other important sources 

 of supply where our pound no longer purchases as 

 manj' dollars or rupees as was the case before the 

 war. Let us take an example to show how the un- 

 favourable foreign exchanges help to raise prices here. 

 Before the war, an American product selling for 

 5 dollars would have cost us approximately 20s. 6d. 

 Suppose the price in the United States has now doubled. 

 Had the exchange remained normal, we should have 

 been able to purchase the article for 41s. — but actu- 

 ally we shall have to pay something hke 55s. 6d. 



There are still two more facets of the jewel to which 

 attention may be drawn. One shows us transport 

 difficulties : scarcity of shipping, accentuated by 

 congestion at the ports, which prevents us from 

 getting the best use out of such shipping as is available ; 

 and congestion on the railways, which, like scarcity of 

 shipping, prevents goods from being delivered when 

 and where they are wanted. Thus scarcity of goods 

 and high prices are aggravated. The other facet 

 discloses the artificial barriers to trade — such as 

 embargoes and licences. These obstacles to trade 

 have similar effects to defective transport facilities — 

 that is, they increase scarcity and tend to raise prices. 

 Readers may urge that I have omitted to con- 

 template one important facet of the jewel, which 

 would portray " profiteering." I have done so 

 dchberately, because " profiteering " is not a cause 

 of high prices ; it is an effect of high prices, which 

 are caused primarily by scarcity and excessive spending, 

 and in a lesser degree by currency inflation, by un- 

 sound loan and taxation poUcy on the part of the 



