bargains are made in consequence; commodities are more sought after;
and, in consequence, prices rise more and more.

The rise of prices is quickest in an improving state of credit.
Prices in general are mostly determined by wholesale transactions.
The retail dealer adds a percentage to the wholesale prices, not, of
course, always the same percentage, but still mostly the same. Given
the wholesale price of most articles, you can commonly tell their
retail price. Now wholesale transactions are commonly not cash
transactions, but bill transactions. The duration of the bill varies
with the custom of the trade; it may be two, three months, or six
weeks, but there is always a bill. Times of credit mean times in
which the bills of many people are taken readily; times of bad
credit, times when the bills of much fewer people are taken, and
even of those suspiciously. In times of good credit there are a
great number of strong purchasers, and in times of bad credit only a
smaller number of weak ones; and, therefore, years of improving
credit, if there be no disturbing cause, are years of rising price,
and years of decaying credit, years of falling price.

This is the meaning of the saying 'John Bull can stand many things,
but he cannot stand two per cent:' it means that the greatest effect
of the three great causes is nearly peculiar to England; here, and
here almost alone, the excess of savings over investments is
deposited in banks; here, and here only, is it made use of so as to
affect trade at large; here, and here only, are prices gravely
affected. In these circumstances, a low rate of interest, long
protracted, is equivalent to a total depreciation of the precious
metals. In his book on the effect of the great gold discoveries,
Professor Jevons showed, and so far as I know, was the first to