Looking back on that amazing adventure of inflation, one must ask oneself the question what would have happened in Germany if its Government had endeavoured to stabilise its finances by not issuing money beyond its real backing, and trying to balance its Budget according to sound methods. It is my opinion that the illusion of German prosperity would have been more rapidly dispelled and that their default in the payment of reparations would have happened earlier. Foreign speculators would not have been “bitten in the ear,” German speculators would not have made profits over exchange gambles; but the Allies would not have received more payments, and there would have been widespread unemployment and revolt among the German people. They were between the devil and the deep sea, and though they chose the devil of inflation, it postponed the plunge into the deep sea for a year or two more. In fairness to Germany, it must be remembered that she did make very heavy payments in money and kind, amounting all told to more than £400,000,000 sterling—that is to say, nearly half the amount of the British debt to the United States of America, which the British people, richer than Germany at the present time, find an almost intolerable burden, although they are paying only £30,000,000 a year to reduce it. In Germany’s post-War state it was a drain upon her dwindling capital which she could not sustain at anything like that rate, and with or without inflation it crippled her. The Dawes Report was an acknowledgment of that fact, although it took into account the immense sums of money secreted abroad. Previous default had caused the French occupation of Düsseldorf, Duisburg, and Frankfurt, arousing a flame of hostility in German minds. But when France marched into the Ruhr against the will of the British, and without their co-operation, the whole of the German people, without difference of class or political opinion, denounced it as a violation of the Peace Treaty, and as a sentence of ruin, not only to Germany herself, but to the whole of Europe. THE OCCUPATION OF THE RUHR