A Human Necessity
A History of Financial Speculation. By R. H. Mottram. (Chatto and Windus. 15s.) MR. R. H. Morraam is in the fine, if select, tradition of English "banker-authors." He is in the line of succession from Bagehot and Leaf, even though his is a very different kind of talent.
He has now, for the first time, turned his pen away from the field of fiction and has applied it to his other speciality, that of finance, and he could not have conceived of a better subject than .4 History of Financial Speculation. The pub- lishers are right in their preliminary " puff " when they say that The habit of speculation is so integral a part of human nature that its history covers infinite ramifications of man's
enterprise—is, in fact, a history of the world as seen through one particular spy-glass." Mr. Mottram has conceived the subject on such broad lines that he has attempted little less than this. He begins with a long chapter which can be truly called a metaphysic of speculation.
"Thus we find that Speculation varies inversely as the control which any of the larger religious systems have been able to maintain over certain peoples. Where, on the other hand, religious observance has been pruned back to some direct appeal from the individual to God, Speculation has become dominant, because such forms of religion can only be maintained by very vital types —witness the Jews, the Parsees, the Quakers. Further evidence is afforded by the marked manner in which the Irish become materially prosperous directly they move outside their island parishes. Of all the millions who have repeated the beatitude, 'The meek shall inherit the Earth,' how many have reflected upon its exact meaning I The truth contained in these six words
is plain enough in :the pages of - history. The Speculator _never inherits the fruits of his effort. Absorbed, like the artist, in hia effort, the truer he is to type the more certain he is to die in harness. Humble populations succeed to the benefits. Of these three religious denominations that have set on foot the system of credit upon which the modern world exists—and credit is perhaps the greatest achievement of the Speculative faculty—we see every day the Quaker fortunes dispersing, the Parsee becoming more obscure, the Jew yielding up his nationality."
Mr. Mottram's general thesis, if we understand it rightly, is that Speculation, which he defines elegantly and tersely as "dealing in fluctuating values," is the fundamental character- istic of the epoch which in Western Europe stretches between the decay of Feudalism and the present moment. For, except in America, Mr. Mottram considers that the age of speculation is drawing rapidly to a close. It will be replaced either by the public monopoly created by Socialism or by the private monopolies created by the great Trusts. In each case monopoly eliminates the fluctuations in values with which the speculator dealt. Standardization is the order of the day. The necessity to feed, clothe, and house ourselves asserts itself, as it did to primitive man, but on a new level which Our capital accumulations make possible for us. But this is not true of the United States.
"In the United States has been created the arch-type of Speculator who will suffer neither scruples nor obstacles in the attainment of monopoly. Yet so broad is the field there, so many the competitors, that no financial institution has reached the monopoly of those to be found in England or France. The situation in North America, in fact, must go beyond the scope of this history. In Europe, Economics in general, Finance in particular, Speculation especially, are ossifying into certain types from which it is unlikely they will depart. In North America all predictions have been set at naught, all rules overrun. The spell of prosperity which suc- ceeded the post-War slump has had variations and breaks, but no definite downward curve is, at the time of writing, visible. The economic filling-up is proceeding apace, the necessity for importing is increasing, but the possibilities of the Continent well outreach the view of any living person. It is only with regard to the Old World, therefore, that this history can in any sense be complete:"
It would be beyond our scope to speculate, in the other sense of the word, on Mr. Mottram's view, but it is certainly interesting.
Most of the rest of the book is devoted to a historical survey of the subject. We recommend especially Part III. Mr.
Mottram has taken for his chapter heading Tom Paine's splendid definition of Credit. "Credit," said Paine, "is suspicion asleep." The story of Law is a fascinating one and Mr. Mottram's defence of this brilliant and, so far as we can see, merely premature financier is most remarkable. Sub- sequent Parts deal with the mid-Nineteenth Century, which Mr. Mottram calls "The, Golden Age," with the Imperialistic Nineteen Hundreds, which he calls "Utopia Limited," and there is a more theoretical last chapter on "The Nature of a Bargain." This last chapter has very definite implications
which the modem statesman might Well ponder. He tells us in his preface that the banks—" the great machines for the maintenance and allocation of wealth expressed in credit" have, in his view, reached relative finality and that
"Such machinery, while capable of readjustment and certainly of improvement, is not susceptible of any further considerable development ; [moreover] with more intelligent use, it is now, subject to the above reservations, ready for the service of mankind, which thus stands at the opening of an era of definite possibilities."
The book is so delightful that it seems ungracious to criticize, but, if Mr. Mottram will take it in good part, we would ask him when he is dealing with a subject such as this, which needs exposition, to write more simply. His style is often amusing and epigranunatic, but we feel that it unduly slows up the reader by a certain turgidness. One is rewarded, however, every now and then by a delightful epigram. For example, he tells us that Credit "began its existence with a National Debt, that millstone without which no true credit system seems to be able to keep its head above water."
Previous page
