CONCLUSION 295 
5. Future Prospects. 
What, then, is the prospect for the future, immediate 
and ultimate? The present decade may be regarded as 
the close of the first great period in the history of wheat 
production in New Zealand. We have reached a trough 
in the graph, the lowest since the middle ‘‘seventies.”’ 
While there have been periodic fluctuations during the 
intervening years, there was a steady rise from 1870 
until the early ‘‘nineties,’’ then a period of stagnation, 
followed by a gradually falling tendency. The next 
30 or 40 years may witness a similar general movement 
with higher average annual production throughout. 
The present upward tendency of general prices which 
commenced in 1895 is likely to continue, although pro- 
duction in all spheres will be increased greatly; for the 
factors on the money side of the ‘‘equation of exchange’’ 
will probably all increase at a greater rate than the 
increase in production. This is the view advanced by 
Dr. Fisher,* who thinks that the present increase in the 
gold production will reach a maximum in a few years, 
and then gradually decline. But this does not mean 
that prices will fall immediately, for the supply of gold 
may still be in excess of the demand, and in any case 
the yearly addition is but a small fraction of the total 
supply. Moreover, gold is but a small fraction of the 
total circulating media, and, even though credit is based 
upon the amount of gold in circulation, the diminished 
supply of the latter will not affect the total supply 
greatly for a long period, so that a great expansion in 
credit may still continue. Professor Fisher has a mas- 
terly grasp of the subject, and his forecast is based upon 
absolutely reliable facts. 
Now, we have seen clearly in Chapter VII., that in 
normal times New Zealand prices are determined by 
conditions operating in markets which are world-wide. 
Anything which affects prices in the outside world 
*See ‘‘ Will the Present Upward Trend of Prices Continue?’’ 
in the ‘‘ American Economic Review,’’ 1912; and his subsequent 
annual brief articles on the ‘‘Equation of Exchange and Fore- 
eact 7) in tha aamoa ‘6 Review 2? 
