tion between the leading central rediscount banks of the world 
has already shown a similar power. 
Nevertheless, there are important limitations upon the em- 
ployment of bank credit for such purposes. To begin with, 
it is of only temporary usefulness, for bank credit except in 
special circumstances cannot readily be tied up in large amounts 
and for long periods in foreign countries. Moreover, as in 
the case with international gold shipments, the extent to which 
bank credit can be employed internationally to balance trade 
accounts is limited. For if the banks of a given country should 
attempt to transfer their credit abroad in unlimited quantities, 
violent and convulsive movements in the home money markets 
would soon be produced, to the disadvantage of domestic 
business 16 
516 THE WORK OF THE STOCK EXCHANGE 
The International Shifting of Securities.—In conse- 
quence, to avoid the harmful economic results of over-export- 
ing or over-importing gold or bank credit to right national 
trade balances, the third expedient of shifting securities from 
one country to another must be constantly and extensively em- 
ployed. As a result, the international shifting of securities 
contributes today in a very vital way toward the maintenance 
of balanced trade and exchange rates and the avoidance of 
excessive exports or imports of gold or bank credit; it likewise 
serves as a stabilizing force upon the production rate of goods 
and services, the buying power of currencies, and upon all the 
other items which enter into foreign trade accounts. The 
international shifting of securities occurs most readily, of 
course, in security issues listed upon both a domestic and a 
foreign stock exchange. It is, of course, true that securities 
not so listed are frequently shifted from one country to an- 
other, yet this process as a rule does not occur so readily. 
Thus it came about that in recent years no small part of the 
task of restoring the gold standard abroad really fell upon 
the New York Stock Exchange because of the important part 
TT 15 See Appendix XVIITd.