510 THE WORK OF THE STOCK EXCHANGE
significance to currencies and credits, however, the yellow
metal is not included in the ordinary tale of visible imports or
exports along with such less romantic goods as soft coal, ma-
chinery, or wheat, but separate statistics are kept of its “ar-
rivals” and “departures” to and from our ports. The same
practice is also followed in the case of silver—the other
financial metal.
And so this list might be enumerated, to include the thou-
sand-and-one different cases where an international bargain
of some kind has been struck. Two other classes of services,
however, are of sufficient importance to deserve consideration
here—bank credit and securities.’ Just as securities can be
shifted from one country to another through stock exchanges,
so bank credit can be exported and imported by steamer or
even by cable. Both must therefore be included as a final but
important item in the total exports and imports of any nation.
Thus, when a German sells his bonds or stocks to an American,
America may in consequence be said to export its capital to
Germany, and we in turn import the receipt for this exported
capital of ours in the form of German stock or bond certifi-
cates. So, too, bank credit can be shifted between nations by
international banking operations.
The Actual Balance of Trade.—But one feature of all this
bewildering purchase and sale of goods and services carried
on by every modern nation should be clearly noted. In the
long run the total exports of every nation must balance its total
imports. No nation can regularly and indefinitely buy more
than it sells, or sell more than it buys, from or to the rest of
the world. This fact may seem in direct contradiction to the
facts presented by our past pre-war foreign trade reports. Even
14 In enumerating the various items which constitute a nation’s invisible trade, an
initial question of definition exists. Contrary to the prevailing custom, securities and
bank capital in the last analysis should probably not be included in the so-called “inter-
national trade balances’ at all, since they do not represent consumable goods or services,
but rather income-bearing loans tendered as long- or short-term payments for past or
future goods and services. Certainly, a nation is a_ debtor or creditor nation according
to whether it imports or exports a balance of securities and bank credit. Yet, for the
sake of simplicity and clarity, the author has deemed it advisable in the ensuing account
of international trade and finance conventionally to include securities and bank credit as
services in the invisible trade.
