THE WORK OF THE STOCK EXCHANGE

tures. Constant attempts have been made to attain this ideal
through budget systems and the like, and on certain rare occasions
 an approximate equilibrium between income and expense
has temporarily been achieved. But, at least in the hazardous
world of today, only a relative success in exactly balancing the
government's books without a remaining surplus or debt seems
practically possible; for both the expenses and the revenues of
modern government are necessarily variables. Wars in particular
 may quite unexpectedly make necessary vast increases
in governmental expenditure, while the actual sums to be realized
 through the various kinds of taxation in turn depend
upon the veering course of economic development, business
prosperity, and other uncertain factors. In the absence, then,
of an ability consistently to pay the current expenses of government
 out of its current taxation revenue, methods have
naturally had to be devised for financing the sudden financial
needs of government in excess of the amount of its current
income.

Financing with the Printing Press.—QOne age-old fallacy
looking to this end—the printing of large quantities of irre-Jeemable
 paper money—deserves passing comment here. To
those innocently or wilfully ignorant of the intricate and delicate
 mechanism of modern currency, such an inflation of the
money system may seem a simple and obvious panacea. Their
line of reasoning runs.somewhat as follows: “The government
 needs money—money is produced by the printing press—
therefore we should print what we need.” While this is not
the place to inquire into the complexities of modern currency
sufficiently to explode this superficial but tremendously dangerous
 economic fallacy, it is enough to state that every government
 which has followed this primrose path of financing
has in the end discovered it to be not only a highly dangerous
but a completely futile expedient. Never in history was the
disruptive effect of fiat money on the whole economic structure
of civilization illustrated on so extensive a scale, with such