Many a statesman of an honestly toiling, upward-striving land watches
with anxiety this figure which withdraws from his country undeserv-
edly and inexorably a part of the fruits of its industry, and conveys to
the bondholder unearned and unexpected gain. The crises of recent
times have famished abundant examples in which the paying capacdty
of a debtor country was exceeded and a good part of the capital was
lost along with the interest.
Here I would like to return to a word of Balfour^s already cited (p.
90). Money is said to be also the measure of value of deferred pay-
ments. The longer the period of deferment the graver must be under
present circumstances the consequences of the progressive divergence
of the values of gold and silver. The silver land is loath to buy in
the gold land, but it must be yet far more careful not to incur long-
time gold debt. The almost complete cessation of the emission of for-
eign loans in London in 1891 is a consequence of the experiences in
South America, which, however, have become as instructive to all
other debtors as they are to the creditors who have to bear the loss.
That, and not the success of the gold regime, is at this day the reason
of the cheapness of loan money.
