quickened, but so also was that of money by discoveries of gold and the development and expansion of the use of credit instruments in the shape of bank notes, bills of exchange and cheques. During the first quarter of the nineteenth century, as Mr. Keynes tells us,[1] "The very high prices of the Napoleonic Wars were followed by somewhat rapid improvement in the value of money. For the next seventy years, with some temporary fluctuations, the tendency of prices continued to be downwards, the lowest point being reached in 1896. While this was the tendency as regards direction, the remarkable feature of this long period was the relative stability of the price level. Approximately the same level of price ruled in or about the years 1826, 1841, 1855, 1862, 1867, 1871 and 1915. Prices were also level in the years 1844, 1881 and 1914. If we call the Index Number of these latter years 100, we find that, for the period of close on a century, from 1826 to the outbreak of war, the maximum fluctuation in either direction was 30 points, the Index Number never rising above 130 and never falling below 70. No wonder that we came to believe in the stability of money contracts over a long period. The metal gold might not possess all the theoretical advantages
- ↑ Monetary Reform, p. 11.
