American students will welcome this volume as an able analysis of problems of credit and of the business cycle from the English point of view. The first three chapters contain most of the theoretical material in the book and give the author's views on money and credit. The chief function of money, he believes, is not to serve as a medium of exchange but as a " money of account " or what we in this country would probably term "standard of value " or "pecuniary unit." Credit, especially in the

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... m of bank notes, would supply society with a satisfactory medium of payment but would not provide a stable standard of value. When gold is brought in to give us a stable standard of value, new problems are introduced. Chief of these is the problem of holding the credit in manageable or redeemable ratio to the gold. A banker is a dealer in debts and credits. While in law a debt is payable in money, yet in actual practice nearly all debts are settled by entries on the books of the bankers. This holds true not only in the same city, and not only in the same country, but internationally as well. Bank credit, in the author's view, does not serve chiefly as a medium of exchange, but as an aid to production and merchandising. Originating in production, this credit is extinguished in consumption. Consumers' purchasing power is largely supplied out of credits which the bank furnishes to manufacturers and merchants. In the discussion of the quantity theory the author holds that little is gained by introducing the "velocity of circulation" and "total money transactions" (V, V', and T). "The quantity theory is not in strictness concerned with varying conditions at all, but merely with the determination of the value of the monetary unit when all other conditions are fixed." The next group of chapters deals with foreign exchange and testifies to the author's familiarity with the practical aspects of foreign banking. The next section (chapters viii-xii) deals with financial and business crises, and shows the important r6le which credit plays in the ups and downs of 517