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benefits a nation as a whole unless it directly benefits the individual citizen, whereas an ancient canon of logic affirms that what is true of the whole is not necessarily true of the parts. Again, it is asserted that all Europe is obsessed with the idea that conquest greatly benefits the conqueror; while another chapter is devoted to showing that the small states of Europe are safe merely because no one could profit by conquering them. Evidently Europe cannot at the same time be obsessed with the idea that conquest is profitable, yet refrain from conquest on the ground that it is unprofitable. Again, there is no evidence of familiarity with other writings on the economics of war, nor indeed with economic principles in general, aside from certain commonplaces about the financial interdependence of all countries. This is in fact the fundamental defect of the book: the problem is seen merely as it might appear to a trader on 'change. The basic matter of production is wholly ignored; the laws of increasing and decreasing returns are not even mentioned. There is consequently no suspicion that the interests of two manufacturing countries competing for the same markets are in irreconcilable conflict; yet this is the fact which underlies most modern wars and rumors of wars, especially the growing tension between England and Ger

many.

University of Minnesota.

EDWARD VAN DYKE ROBINSON.

NEW BOOKS

HOENIG, A. Der Ers und Metallmarkt. (Stuttgart: F. Enke. 1910. Pp. viii, 450. 10.80 m.)

HULL, G. H. Industrial Depressions. (New York: F. A. Stokes Co. $2.50.)

JUROWSKY, L. Der russische Getreide export, seine Entwickelung und Organisation. Münchener volkswirtschaftliche Studien. Stuttgart: J. G. Cotta Nachf. 1910. 4.50 m.)

LEENER, G. DE. Le commerce au Katanga: Influences Belges et etrangères. Missions dans le Katanga. Instituts Solvay. Travaux de l'Institut de Sociologie. (Brussels: Misch et Thron. 1911. Pp. xviii, 143. 3 fr.)

Relations with Rhodesia and the part taken by European countries in the development of this district.

MARX, A. Die französische Handelsgesetzgebung. (Bonn: Carl Georgi. 1911. Pp. xv, 390. 5 m.)

PAUJOL, A. Code de commerce d'Haïti, introduction historique, notions de procédure civile et commerciale et lois les plus usuelles. (Paris: A. Pédone. 1910. 12 fr.)

VOIGT, L. Luigi Fontana-Russos handelspolitische Theorien. Münchener volkswirtschaftliche Studien. (Stuttgart: J. C. Cotta Nachf. 1910. Pp. vii, 96. 2.50 fr.) ZWIEDINECK-SUDENHORST, O. V.

Sozialpolitik. Teubner's Handbücher für Handel und Gewerbe. (Leipzig: Teubner. 1911. Pp. vii, 450. 9.20 m.)

Accounting, Business Methods, Investments, and the

Exchanges

Stocks and Shares. By HARTLEY WITHERS. (New York: Dutton and Company. 1910. Pp. 371.)

The principles governing operations in the stock market have been less adequately treated in financial literature up to a recent date than the science of currency and the money market. This arises partly, no doubt, from the comparatively recent development of stock exchange operations on a large scale and partly from the fact that the combination of expert knowledge and literary capacity to treat the subject is rare. Even where the capacity might exist, the time or the disposition is usually lacking. The expert stock operator is too busy to write books about what he is doing; and the writer of such books is not infrequently a person who has been driven to writing because he has failed on the stock exchange.

The connecting link between the practical and the literary side of the subject is naturally furnished by the financial men on the daily papers. Among those who have shown a happy faculty for combining a knowledge of sound principles with such a treatment of financial subjects as brings the reader in touch with the actual life of Wall Street and Lombard Street, is Mr. Hartley Withers, the financial editor of the "London Times." Mr. Withers is already favorably known to students of financial matters by his clear and entertaining volume on The Meaning of Money. In that work, he presented an account of the operation of the London money market which in some respects supplements the classic analysis of Bagehot a generation ago. The new work, Stocks and Shares, is the companion volume to The Meaning of Money. Written in a lucid and easy style, it combines a description of the mechanism of the stock exchange and of dealing in securities with some shrewd hints in regard to trading and speculation.

From the standpoint of the American reader, the chief benefit of the descriptive portions of the work lies in their explanation of the terms used by the arbitrage and exchange houses which deal with London, and with the incidental light which is thrown on the motives which influence speculators and the factors which determine the rise and fall of security prices. It would be worth while for the untutored politicians who throw into the legislative hopper every year measures against sales of cotton futures and short sales of securities, to read what Mr. Withers has to say on "the beneficent bear" and similar topics. One of his lessons is summed up in the following language:

In fact, there is nothing more immoral about selling stock that one has not got than about buying stock that one does not propose to pay for, and it has already been shown that the existence of a bull account is a source of weakness to a market, since it means that there are a large number of people who want to sell, while the existence of a bear account is a protection and support, since it implies that if any bad news is received, there are a number of folk waiting to close commitments by buying back stock of which they are short.

There is an important distinction between the science of money, about which so much has been written, and the science of stock exchange speculation. This lies in the fact that by reading only one may get a fair idea of monetary science, while reading till doomsday would hardly in itself fit one to go successfully into the stock market. In monetary matters, certain results may be reasoned out from given causes along comparatively simple lines. In the stock market, while there are always fundamental economic principles in operation, the effort of the successful operator is directed primarily to discovering hidden currents or tendencies, in advance of their discovery by others, and in so balancing conflicting human motives as well as financial tendencies as to do better than others in such calculations. In such a contest, accuracy of judgment in regard to both the seen and the unseen is the vital factor. From books one can learn of a few combinations and possible pitfalls, but he cannot learn, as he practically can in the case of monetary science, what he should do in a given situation. For the purpose of defining these combinations and pointing out these pitfalls, such books as that of Mr. Withers have a certain value, and his is among the most readable and practical which has come from the press.

CHARLES A. CONANT.

Die Preisbildung an der Wertpapierbörse, insbesondere auf dem Industrieaktienmarkt der Berliner Börse. By DR. PRION. (Leipzig: Duncker und Humblot. 1910. Pp. xii, 216. 7 m.)

In this monograph we have an excellent exposition of the principles underlying valuation or forming of prices with special reference to actual conditions on the Berlin stock exchange. Incidentally it will open up to American students of money markets and monetary problems a good view of German experience with those affairs, especially since 1871, when the nationalization of Germany brought new economic, as well as political, life to her. people. The problems have been much the same as we find in American experience: an exceedingly rapid growth in wealth and population; the creation of enormous values, which shifted, easily perhaps, into the hands of the few; and finally speculation, and stockjobbing of all kinds, evils which the old laws and conditions had not contemplated. But the highly centralized power of the government of Germany did not keep its hands off stock market affairs as we in democratic, individualistic America have done.

According to Dr. Prion the old law of supply and demand, especially in mechanically fixing prices, is to be given up; in its place he puts denkende und handelnde Menschen (thinking and profit-seeking men) as determining factors. From this point of view he marshals the material, arranges its presentation, and draws conclusions. In the first part, which deals with the inner structure of the Exchange, we find a good exposition of the elements of the Berlin Market. The personal factors are described under the captions of Speculators, Investing Public, and Banks and Bankers. With these speculators, large and small, professional and unprofessional, the "initiated" and the "lambs," as well as with the banks and brokers, we are familiar in America. Under technical market factors are discussed "Termingeschaeft," i. e. dealing in futures, and "Kassageschaeft," or regular cash business. The formation of the classes of the "Baissiers" (bears) and the "Haussiers" (bulls) is brought out as well as the part that these play in fixing market prices.

The economic factors in valuation are well handled; first, a discussion of the value of stocks in general, how the value is built up from their dividends or the incomes from them; and second, the influence of the Geldmarkt and the Kapitalmarkt (loan-fundmarket) upon the fixing of the prices of stock.

In the Second Part we have an application of these general principles with especial reference to the course of affairs in the Berlin money market. The price formation of stock values on the market, using the market for "Industrials" in particular, is traced during the period of rising prices in 1889-1890, the crisis of 1890, and the consequent depression from 1890 to 1894; then, during the second period of rising prices through the flurry of 1895 and the period of the Stock Exchange Law of 1896, followed by six years of prosperous times up to 1902; and finally a lower but steadier level of prices on up to 1907. Five excellent charts showing the rise and fall of market quotations, the capitalized dividend value, etc. accompany this part of the text.

The conclusions reached are that the market values of Termingeschaeft (contracts for future delivery) varied much more widely from their true worth than did the market values of Kassageschaeft (regular cash business). Also during the critical periods of 1890 and 1895 the fluctuations were more violent in Termingeschaeft than in Kassageschaeft. After the Stock Exchange Law of 1896 the market values adjusted themselves more nearly to their real worth. A critical survey of economic literature discloses that these conclusions are at variance with the other leading authorities, as Cohn, Spietthoff, Bachmann, and others. On Market Reform, Dr. Prion concludes that the improvement in price formation on the stock market is due to the coming-in of the more conservative and responsible big men and institutions as factors in the money market. To attain the most perfect market conditions possible, however, there must be placed before the whole public a complete knowledge of market forces and market conditions, even in the Hochschulen and Volkschulen. Thus the people at large will be acquainted with the fundamental principles of "Geld,” "Kapital," "Verzinsung," "Anlage," "Kredit," etc. As an exposition of stock market conditions in Germany this book is eminently worth while.

Stanford University.

NEW BOOKS

D. F. GRASS.

BISHOP, W. G. A short course in business training for normal schools, high schools, teachers, and independent students. (Chicago: The University of Chicago. 1911. Pp. v, 183. 90c.)

CARNEGIE, A. Editor. Business. (Boston: Hall & Lock Co. 1911. Pp. xiv, 401.)

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