periods credit is bad, and industry unemployed; very generally
provisions are high in price, and their dearness was one of the
causes which made the times bad. Whether there was or was not too
much loanable capital when that period begins, there soon comes to
be too much. Quiet people continue to save part of their incomes in
bad times as well as in good; indeed, of the two, people of
slightly-varying and fixed incomes have better means of saving in
bad times because prices are lower. Quiescent trade affords no new
securities in which the new saving can be invested, and therefore
there comes soon to be an excess of loanable capital. In a year or
two after a crisis credit usually improves, as the remembrance of
the disasters which at the crisis impaired credit is becoming
fainter and fainter. Provisions get back to their usual price, or
some great industry makes, from some temporary cause, a quick step
forward. At these moments, therefore, the three agencies which, as
has been explained, greatly develope trade, combine to develope it
simultaneously.

The certain result is a bound of national prosperity; the country
leaps forward as if by magic. But only part of that prosperity has a
solid reason. As far as prosperity is based on a greater quantity of
production, and that of the right articlesas far as it is based on
the increased rapidity with which commodities of every kind reach
those who want themits basis is good. Human industry is more
efficient, and therefore there is more to be divided among mankind.
But in so far as that prosperity is based on a general rise of
prices, it is only imaginary. A general rise of prices is a rise
only in name; whatever anyone gains on the article which he has to
sell he loses on the articles which he has to buy, and so he is just
where he was. The only real effects of a general rise of prices are