24 JANUARY 1931, Page 19

SAVING AND SPENDING

-[To the Editor of the SPECTATOR.] Sni,—The note--,-Spending and Saving—in this week's editorial commentary, touches on a topic of puzzlement to a large number of us, unversed in economic principles and their workings, who cannot see how thrift and rigid abstinence can stimulate trade revival.

I, for one, had thought that, difficult as economic arguments are to follow, I had understood Mr. J. A. Hobson's article in the Manchester Guardian, and that he had forecast, or at least provided for, the future. He appeared to explain the recurrent waves of trade depression as being mainly the outcome of so large an application of profits during trade prosperity to the production of materials and machinery for more production that a glut of goods is brought about at last ; the " saving which is the traditional fuel of fresh enterprise " has been

piled on too heavily and choked the boiler. • Then is it profligate to rake out the ashes and let so►uc of the fuel burn away ? Is it not necessary ?

The economic machine is so complicated that no doubt those who understand it could push the metaphor further and show the wheels within wheels.which controvert this simple truth— that over-stoking cannot be remedied by more stoking.

For the .moment, to us simple children of common sense; it does look as if Mr. Hobson and Mr. Maynard Keynes were right.—I am, Sir, &c., - - - Neb House, Otd Oxted, Surrey: R. E. KENT.