120

WAR  BORROWING

through  1911;  lower  than  the  rates  in  the  three
years  from  1912  through  1914  and  higher  again
than  the  rates  of  the  two  years  1915  and  1916.
The  first  of  these  intervals,  1908-1911  was  a  period
of  business  depression  following  the  crisis  of  1917;
the  second,  1912-1914,  although  of  mixed  quality
was  on  the  whole  a  period  of  business  revival  and
financial  activity;  the  third,  1915-1916,  was  a  period
of  war  convulsion  and  feverish  adjustment  to
wholly  abnormal  conditions.
The  cost  of  commercial  capital  in  the  United
States  during  the  period  of  our  actual  belligerency
has  thus  been  greater  than  in  the  last  preceding
period  of  business  depression,  less  than  in  the  last
preceding  period  of  business  activity,  and  greater
than  in  the  highly  exceptional  years  immediately
preceding  the  entry  of  the  United  States  into  the
war.
Just  as  the  capital  strain  suffered  by  the  business
world  is  evidenced  by  the  relative  altitude  of  the
prevailing  money  rates,  so  the  recurrent  jar  and  dislocation ­
  to  which  the  capital  markets  are  exposed
appear  in  the  frequency  of  variation  of  such  rates
from  a  normal  range.  If  the  upper  limit  of  the
normal  range  of  the  money  rates  in  the  United
States  be  taken  as  six  per  cent,  the  presence  of  dislocation ­
  will  roughly  be  evidenced  by  the  frequency
with  which  the  prevailing  rates  exceed  this  limit.
In  the  following  table  are  shown  for  each  year  beginning ­
  with  1908  the  number  of  weeks  within
which  or  some  part  of  which  the  quoted  rates  of  call
and  time  money  rose  above  six  per  cent.: