136 
POLITICAL ECONOMY 
However briskness of trade may have been 
initiated, it is certainly true that once it has 
appeared an increasing demand is made upon 
banks for money. Business men are anxious 
to get the means of undertaking yet more of 
the profitable business that is being offered 
and increase their earnings. There is conse 
quently a larger demand for overdrafts and 
a larger offer of bills for discounting ; and it 
is undoubtedly a fact that when the means 
of prosecuting further business are readily 
furnished avenues are opened for over-trading. 
Moreover the rise in prices which the aug 
mentation of money naturally brings about, 
according to the quantity theory of money, 
itself tends to stimulate production. Banks 
are, therefore, placed from time to time in a 
position in which they can either urge on the 
business community in a speculative career 
which culminates in disaster or apply the 
curb and prevent it from rushing into 
danger in its excitement. Banks are in 
creasingly realising how they are placed 
in this matter and recognising their obliga 
tions. One difficulty, naturally, is to decide 
at what point good trade which is sound 
becomes over-trading which is unsafe ; and 
there is another difficulty in that banks 
may have to persuade themselves to sacri-