The Kinetic Theory of Economic Crises 71 



an egregious error to mark them out as solely responsible for 

 credit fluctuations. The financier is but a leader, not an autocrat. 

 He is powerless without cooperation. In order to secure this, he 

 must offer sufficient inducements. If the bonuses, the capitaliza- 

 tion of prosperity-income, of good-will, bring on inflation, is that 

 more to be laid at the door of leaders of finance than of the in- 

 vesting public which refuses to join the procession of progress 

 without such inducements? The financiers are the prime movers 

 in progress, but they can only act within and through the existing 

 conjuncture. The largest concerns are those that set the example. 

 The induced currents of "credit" acquire a high tension in the 

 independent circuits of high finance and are finally discharged 

 through optional connections with the primary circuit, or even 

 across non-conducting spaces. The whole industrio-financial 

 body is finally coerced to join the movement upwards, on princi- 

 ples of normalization familiar to students of society ; all prices are 

 forced upwards in order to meet the rising tide of expense. La- 

 borers, common carriers, hotels, as users of the prime necessaries 

 produced by the corporations, put up prices in order to cover their 

 rising expenses. The most striking example is offered of the 

 all-compelling power and irresistible action of the social mind. 



In recent decades, covering as they do a series of successive 

 environments, exchange has normally been effected on the credit 

 plan. The movement towards the crisis has consisted in an 

 exaggeration or abuse of that plan. The definition of credit as 

 "set-off" makes prominent the simultaneous or spatial feature. 

 Along with this goes a temporal feature. Normal credit is not 

 only of a certain standard value but it represents a normally long 

 production process. Credit must exist of a certain length in order 

 to allow those transportations of merchandise from place to place 

 which are necessary in order to fulfil physically operations of 

 sale and delivery. When delivery is effected, set-off may occur. 

 It can not occur sooner, for the flow of bills can not, on the aver- 

 age, be faster than the flow of goods. 



Similarly, payment of loans can not occur faster than produc- 

 tion turns goods out. The roundaboutness of the process limits 

 the length of the promise, on the one side; distance and rapidity 



71 



