CHAPTER 24

TrE UniTED STATES, II. 1900-1914

IN the period from 1900 to the Great War, the foreign
trade not only of the United States but of all countries showed
a comparatively even growth. The advance, tho halted somewhat
 by the crisis of 1907, and not proceeding at the same pace
or in parallel lines in all countries, was world-wide; and it
was extraordinary in extent. Allowance must be made, when
scanning the figures, for the rise in prices; the physical
quantities did not increase as much as did the recorded money
values. But with all needed qualification on this score, the advance
 appears still extraordinary. Something of the same sort
had happened a half-century earlier, in the period from 1850 to
1860. Then too the volume of international trade increased by
leaps and bounds. Then too, after all allowance for higher prices,
the increase in physical terms remained astonishing. In both
periods there was the phenomenon of greatly increased gold
supply : from the Californian and Australian mines in the first,
from the South African in the second. The added gold supply,
it is pretty generally agreed, was the cause, or a dominant cause,
of the general trend toward rising prices. This same cause is also
often referred to as explaining the growth in international trade
and indeed in world-wide production. It is not obvious why substantive
 consequences of such magnitude should ensue from the
mere enlargement of the circulating medium, or rather of the basis
on which the circulating medium rested. More probably, it
would seem that the main explanation is to be found in the accumulated
 effects of improvements in transportation by land and by
ocean, such as were made on so great a scale in the second quarter of
the 19th century, and were again made in its last quarter, com-2092