FINANCE AND CREDITS 301 
lombia, Guatemala, Haiti and Paraguay. 
The basis of exchange between countries de 
pends primarily on the relation existing be 
tween the gold value of their respective 
moneys, the price paid being materially influ 
enced 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 politi 
cal or economic unrest, or at war, the price of 
exchange on it goes much higher than if con 
ditions were normal. For these reasons ex 
change 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 impos 
sible to determine a fixed rate of exchange for 
any definite period. By buying when ex 
change is low and selling when it is high, much 
money can be made, especially if the sum in 
volved is large. The United States did a gross 
business with Latin America in 1912 of $326,-