224 ECONOMIC PRINCIPLES

goods in value largely exceeding her exports to those
countries; France exports to England to a value largely
exceeding her imports from that country. To establish the
chain, we need only to assure ourselves that England is
entitled to claim payment of balances from China and India.
With the former country, there is a trade-balance due, for
exports to China from England exceed imports from China.
In the case of India, the direct trade with the United
Kingdom leaves some balance of merchandise exports to
India over imports thence, but to this must be added the
annual payments due, for interest on British capital invested
in India, and for payment of civil servants, and of officers
and men serving in the army in India, in so far as their
pay is remitted to England, or pensions are drawn there in
respect of Indian service. Some part of the balances due
from India and China are received through France. Other
cases of apparently one-sided trade may be found to which
a similar explanation applies.
It is sufficiently obvious that the apparent trade balances
are not liquidated in money. The aggregate of the differences
between the imports and exports of the United Kingdom, for
the five years ending 1902, would have required for its payment
 the greater part of the world’s monetary stock of gold,
a stock many times greater than the stock of the British
Islands, which is estimated at an amount not greatly exceeding
 100 million pounds. In place of a payment of gold to
foreign countries, however, the record shows that nearly
39 million pounds in value of that metal was received in
the five years, over and above the gold exports of the same
years.