EQUILIBRIUM DISTURBED.
Before the outbreak- of the Great War in 1914, although a certain amount of unemployment existed in all countries, and although countries differed from time to time in the measure of their relative prosperity, there was a sufficient equilibrium to ensure reasonable stability both in world prices and Foreign Exchanges. This measure of equilibrium was completely overthrown by four years' war. During the War Itself all the belligerent countries of Europe not only piled up huge internal and external debts, but their industrial activities had to be centred almost entirely upon making war munitions, and manufacture for export was, in some cases, at a stand- still, and in all cases was seriously curtailed. In addition, the monetary inflation during the War and the high wages and profiteering in many countries constituted a bad preparation for the conditions which had to be faced when the War came to an end. During the first three years of the War the heavy purchases of war materials from America caused huge shipments of gold to that country, while in addition America during her three years of neutrality gained a march upon the belligerent nations in capturing world markets, an advantage which was still further exploited immediately after the conclusion of, the War when colossal orders poured in • to the States from the belligerent countries (where supplies had run down), while the State, by reason of only having been in the War _ for a year, and having her machinery and plant greatly enlarged, was in a position to take the fullest advantage of the world's-needs- by supplying such needs at famine prices.. . •
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