6 JUNE 1931, Page 30


And when I refer to scientific theories with regard to the causes of depression, I am thinking mainly of those eminent Economists who would attribute the depression as being due in the main to monetary causes, that is to say, scarcity of gold, insufficient credit, or lack of confidence engendered by monetary policy and so forth. Among the Economists who hold this view few have done so more persistently, skilfully and persuasively than Professor Gustav Cassel, who recently expounded his views to an assembly of Bankers in the City of London, the gathering being under the auspices of the Bankers' Institute. At the outset of his address Professor Cassel said one very true thing. After referring to the fact that if essential faults have been committed we must correct them, he summarized some of the faults of which the present generation has been proved to be guilty, those faults not excluding the Great War itself. Having, however, enumerated a number of these alleged faults, including the unnecessary interference of the State with industry and the abuse of the Dole system, Professor Cassel very properly insisted that if there were different causes at work responsible for the depression we must simplify the situation by inquiring whether there are causes of less dominant importance as to enable us to simplify the question by directing our attention in the first instance only to its principal factors. Following that word of introduction, the whole of the remainder of Professor Cassel's -address to the Bankers made it abundantly clear that in his judgement the monetary or gold factor must be regarded as the chief influence responsible for world depression.