THE UNITED STATES, III. AFTER 1914 321 
doubtful at the date of writing (1926) whether the country’s 
trade had settled to really permanent conditions. I hesitate to 
comment on the rapidly shifting situation; whatever is written 
on the subject now (1926) will be behind the times from the moment 
of publication, and will need to be supplemented and revised in 
view of what develops during the years following. The analysis 
which follows is designed mainly to show how long the post-war 
conditions in the United States retained an unusual character 
and how little they lent themselves to explanation on the lines of 
the general theory of international trade. I will begin by con- 
sidering In turn the several items in the international account. 
While there were still temporary and erratic movements, others 
of permanent significance can be traced. 
The temporary movements were mainly caused by the still dis- 
turbed conditions of European countries. Uneasiness about the 
monetary and political prospects led to anomalous transactions of 
considerable volume. Characteristic among these was the outflow 
from the United States of its paper money, much of it in small 
denominations. Being a thing stable and reckonable, this was 
used or hoarded in Germany, Austria, and other countries with 
disorganized currency. For the time being its outflow was equiva- 
lent to an export from the United States. Before long — by 
1923 and 1924 — the paper straggled back; and its back flow 
became in turn equivalent to an import item. Similarly, uneasi- 
ness concerning the future caused foreign investors and property 
owners to transfer funds to the United States. Sometimes they 
bought American securities outright; sometimes they left 
“money” to their credit on the books of banking houses. These 
operations (most marked in 1923) were equivalent in their effects 
to the making of loans by Europeans to Americans. They brought 
an offset for the time being to the loans which were made at the 
same time by Americans to Europeans. This flurry became less 
marked after 1923. On the other hand, the European borrowings 
which had begun during the war and had been maintained even 
thru the period of greatest uneasiness, were resumed on a larger 
scale by 1924, and quite offset the effects of this flight of capital.