24 JUNE 1911, Page 3

The question of the causes of the fall in the

price of Consols was once more raised in the House of Commons on Monday. We cannot help thinking that the true explanation is simple enough. The price of Consols, like the price of everything else, is determined by the law of supply and demand. If the supply is increased or the demand diminished, or if both happen at once, the price must inevitably fall. The action of the Government in " raiding " the Sinking Fund and reducing the rate at which the National Debt is paid off has had the effect of greatly diminishing the de- mand for Consols. This we believe to be the principal cause of the drop in their price. The increase in the number of trustee stocks has, of course, also had the effect of reducing the demand for them.