The Wanganui Chronicle. "NULLA DIES SINE LINEA." FRIDAY, MARCH 13, 1910. TRADE CYCLES.

Wanganui Chronicle, Volume L, Issue 12465, 18 March 1910, Page 4

The Wanganui Chronicle. "NULLA DIES SINE LINEA." FRIDAY, MARCH 13, 1910. TRADE CYCLES.

Jbb use and fall of trade, with its at- I tendant consequences of prosperity and depression, is a subject of universal in. I .terest, and it is dealt with in a very! interesting.manner in an article in the-! London "Spectator" on trade cycles! and unemployment. The.-writer,- who] signs himself "Economist"-points out I that some statistics appearing in the' mojonty report of the Royal \ Commission on the Poor Laws » in which the general industrial characteristic of , e ach ™" 7 3515 +n IQA7 • • year from fl ! ; °7 1S glven > s«PPIy for th. fi-t time data by which to m easut tne accuracy o* the accepted .theory .hat trade undergoes "cycHcal movement,. Th lS theory was expounded | by the great political economist W S Jervons; in his. "Investigations in Cm'iency and Finance," wherein he indulged m speculations on the connection between the maximum crises and sunspots. He found certain, parallels between the maximum appearance of spots in the sun and the maximum 01 mdustria 1 activity and, pursuing his lesearche,-, over a period of nearly two centuries, he suggested that the* cycle between the twin lnaximums 'referred ' to was slightly more than ten years. It is asserted by. the writer; in the 'Spectator" that whatever may be the case as regards sun-spots, the in the Poor Law Commission's reportseems to show that ''within every ten or eleven years since 1815 there has been a'time of deep depression and a time of active trade, and that ths* movement between the recurrence of these points has described, an almost' constant flow and ebb." It is obvious as the Christchmch "Press"-points out, that such a movement may be affected by conditions outside the normal circumstances of trade such as wars, the failure of the supply of raw material from abroad, as in the case of the Lancashire cotton famine in the 'sixties, the birth o:< death of great industries,1 a revolution in fiscal policy, such as occurred When England adopted Free Trade, uirusually, good or bad.harvests,1 and so forth.' it is claimed,, howefer, that the trade of ■■.-.Great Britain has been subjected to no outstanding disturbance during the last two decades, and that during ihat period the cyclical movement has been more definitely marked than ever. Thus, says, the writer, "from 1887 to 1896, the cycle runs: revival, marked revival, prosperity, prosperity, decline, depression, depression, settled dap:ession, revival, slow revival; and from 1897 to 1906 it mils: Prosperity, prosperity, great prosperity, culmination of' prosperity, slowebb, slow ebb, depression, distress, revival, prosperity. It we trust to history, then, the cyclical movement is part and parcel of the normal system of industry." If this is so, the "Press** argues, "it seems inevitable that the cycle will continue to become more definitely marked, partly because industries, by the p:x>cess of subdivision that has occurred and is still going on, tend to become more and more interdependent, so that failure in one affects the whole, and partly because, owing to this close "connection, the contagion of depression spreads quickly from one to the other. It is not easy to suggest a remedy for a condition of affair that may, apart from external and temporary disturbing influences', possess ah most the inflexibility of a law of Nature. But at least its ill effects may be mitigated if il; is% remembered that, a-enersilly speaking, the ebb of.a tide equals its flow. If the tide of trade rises to an abnormal height of prosperity, we may expect an unusually strong ebb towards depression. The old warning that in time of peace w re should prepare for war applies in this case, and if nations and communities and individuals" acted on this sound advice there would be less reason to fear times of trade depression and unemployment, because preparation would have been made to meet them."