FINANCE  AND  CREDITS  301
lombia,  Guatemala,  Haiti  and  Paraguay.
The  basis  of  exchange  between  countries  depends ­
  primarily  on  the  relation  existing  between ­
  the  gold  value  of  their  respective
moneys,  the  price  paid  being  materially  influenced ­
  by  the  condition  of  the  balance  of  trade
and  the  social  or  political  state  of  the  country.
For  example,  with  the  balance  of  trade  in
favor  of  England,  the  price  of  exchange  on
that  country  would  go  up  a  fraction  of  a  point
or  so,  while  if  a  country  is  in  a  state  of  political ­
  or  economic  unrest,  or  at  war,  the  price  of
exchange  on  it  goes  much  higher  than  if  conditions ­
  were  normal.  For  these  reasons  exchange ­
  in  all  countries  varies  daily,  the  price
for  the  day  being  decided  upon  the  receipt  of
European  cables  from  the  home  institution.
It  will  therefore  be  apparent  that  it  is  impossible ­
  to  determine  a  fixed  rate  of  exchange  for
any  definite  period.  By  buying  when  exchange ­
  is  low  and  selling  when  it  is  high,  much
money  can  be  made,  especially  if  the  sum  involved ­
  is  large.  The  United  States  did  a  gross
business  with  Latin  America  in  1912  of  $326,-