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CONTENTS

PAGES

of trade, 247. Gross terms of trade less favorable in 1890 and
1910 than in 1900, 251; net barter terms show similar trend,
252. Direction of the changes consonant with theory, 256.
Contrast with the case of Canada, 257; net and gross barter
terms of trade more favorable after 1900, 258. Relation of gold
flows, circulating medium, and prices more complex in Great
Britain than in Canada, 259. Closeness of the connection
between international payments and commodity movements
1s perplexing, 260.

. CHAPTER 22
TE FrANCO-GERMAN INDEMNITY oF 1871
Amount and character of the indemnity, 263. How the
funds for meeting it were raised in France. How they were
transferred to Germany, 265. Part played in the transfer by
French foreign investments, 266. The French experience in the
transfer of securities not applicable to heavy payments of a nonpolitical
 character. The German government's utilization of
the indemnity payments, 268. The economic effects; sustained
inflow of specie; expansion of circulating medium and sharp
rise in prices in Germany, 269. German part of the transaction
spread over many years, and its effects difficult to unravel, 272.
How does the mechanism of international payments function
when there are exceptionally heavy payments to be made? 273.
Adam Smith’s explanation unsatisfactory, 274; Ricardian
explanation does not tell the story, 275. Explanation suggested
by German experience in the 70’s, 276. A possible explanation
for the Napoleonic period, 277. Importance of the time element
in the processes of international payments again considered, 278.

263-278

CHAPTER 23

THE Untrep States, I. UntIL 1900 .
The balance of trade before and after 1873, 280. Sudden
reversal with the crisis of that year, 282. Chaotic banking and
monetary systems before 1860 complicate the analysis, 284.
From 1860 to 1879 the mechanism contemplated in the Ricardian
theory could not operate, the case being one of trade under dislocated
 exchanges, 285. Even after return to the gold standard,
analysis is obscured by increasing domestic gold supply; by
crop alternations, 287; by silver issues, 289; by irregular movements
 of securities, 290.

+

280-291