EXTRACTS FROM LETTERS.
Tim PRICE OF FERTILIZERS.—Mr. A. M. Gray, 08-70 Fen- church Street, E.C. 3, writes that Lord Bledisloe in his letter of October 27th is incorrect in saying that the price of fertilizers has been raised by the Safeguarding of Industries Act :— " The three principal fertilizers, superphosphate, sulphate of ammonia and potash, are now quoted at prices approximately equivalent to or below the levels of 1913-1914. Super- phosphate, for example, is within 2s per ton, on an average, of the pre-War price, and this, despite the fact that the cost of manufacture is anything from 75 to 100 per cent, higher now than it was nine or ten years ago."
DEPIATION AND th•roireLormENT.—Mr. G. S. Sneyd (Bray, Hessenford, Cornwall) writes :—" To attempt to return to the gold currency and the free gold market, to the pre-War standards of wages, prices and currency values in face of the post-War standards of debt and taxation was about as reasonable as it would have been in the reign of Edward VII. to have attempted to return to the wages, prices and currency values of the reign of Edward I. The gap in years is small in the one case but the gap in financial conditions is more or less of the same order.
What was required was to stop inflation and to balance the Budget by economy in Government expenditure. I* should have been recognized :-
1. That it was neither necessary nor possible to return to a gold currency and a free gold market.
2. That taxation and a balanced Budget arc the true 'backing' of currency.
3. That purchasing power, as shown by the index figure of prices, and not gold, is the true measure of value of currency.
4. That a scientifically controlled paper currency can maintain a stable purchasing power and can meet all the requirements of a sound currency as well as or better than gold."
Mr. T. B. Johnston, of Messrs. Pountney and Co., Ltd., Bristol, writes : "The Prime Minister has condemned inflation in unsparing words, but he went on to say, Now I believe theoretically ; in fact, I am sure that theoretically in the course of time matters would adjust themselves. They would adjust themselves the more swiftly if there had been in the world such a growth of world trade as occurred, for instance, at the time of the great gold discovery.' But what did that great gold discovery mean ? Nothing more nor less than the inflation which he so unsparingly condemned, and which Ile admits resulted in a great growth of world trade, and conse- quently employment. There he put his finger on the real cause of unemployment. The late Sir Edward Holden, in a speech that he made at the Liverpool Bankers' Institute in 1907, when he was defending the banks against the charge that they were not helping industries as they might, ended by saying : 'it is therefore clear, generally speaking, that the business of the world is carried on by means of loans, that loans create credits, that the stand-by for the protection of credits is gold, and that therefore gold (i.e., legal tender) controls trade '—and consequently the employment of labour. To-day legal tender is currency notes ; therefore the amount of currency notes available as legal tender now controls trade, and by restricting these notes, which are the basis of credit, unemployment has been caused."
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