But these exciting episodes had no direct bearing on the fortunes of the war. Its ultimate outcome was likely to depend partly on the cohesive and combative power of the British Empire, partly on the attitude of the greater neutral nations, partly on the economic pressure exercised on Germany by the British Navy, and partly on the ability of Great Britain to adjust her trade to the new conditions imposed by the loss of her best customer and of the sources of supply of the components of many of her manufactured goods. On all these the outlook as the year closed was encouraging. The unity of the Empire had never been more conspicuously manifested, and, as the year closed, it was seen to extend even to the Sudan. Recruiting at home, in spite of the pessimists, was not officially regarded as unsatisfactory, and the difficulties in the equipment of the three (or more) new Armies were apparently being overcome. Meanwhile numbers of men past the military age or unable to enlist for other reasons were serving as special constables or organising themselves into bodies of auxiliary troops. There were signs that Italy and Roumania might soon be fighting on the side of the Allies in order to share in the heritage of the tottering Dual Monarchy; the sympathy of the great mass of the neutral nations was estranged from Germany, and the complaints of British interference with their trade were not regarded as giving ground for apprehending serious friction, even in the case of the American Note (_post_, For. Hist., Chap. VII.). At home, serious crime had become rare, and the economic outlook was unexpectedly hopeful. The sufferings predicted by Sir Edward Grey (p. 171) had not as yet been experienced; and unemployment, owing to the demands set up by the provision of the new Armies, was far less than it had commonly been in time of peace. It was seriously felt only in the cotton trade, in a few luxury trades, and in some of the fishing ports, owing to the interruption caused by the war and the loss of the German market for herrings. Pauperism in England and Wales had risen rapidly at the outset of the war; it had subsequently declined to a point only a little above the exceptionally low figures of a year earlier; in London it was actually below them. Doubtless this temporary prosperity was mainly due to an essentially unproductive consumption which would bring its own penalties; but it seemed probable that some compensation might be found for war losses in the capture of certain branches of German trade. A movement for the production in Great Britain of goods for which British consumers had hitherto been dependent on German or Austrian industry had been favoured by the Patents and Designs Act, through which British consumers were enabled to ignore the patent rights of alien enemies, and was energetically aided by the Board of Trade, which collected and supplied the fullest possible information as to the means of carrying