The most fortunately situated combatants in Europe are Russia and Great Britain. The former, covering half the area of Europe, has almost limitless resources, and is much more easily capable of being self-supporting than any of the other Great Powers engaged in the war. This country still has the seas open to it.[1] The State subsidy to marine insurance has encouraged overseas trade, and the re-establishment of the remittance market has removed an obstacle to the flow of exports and imports. Still, it is true that the financial world cannot recover all at once. "It is like a man whose nervous system has been shattered by a great shock. Tonics and stimulants may save him from complete collapse, but real recovery is a matter of months and even years."[2] Further, the work hitherto done and the services performed for Germany and Austria are now no longer called for; our allies in the west of Europe are suffering acutely from the immediate economic effects of the war and the large destruction of capital; our neutral customers have not escaped scot-free. It would seem, therefore, that in spite of the British command of the seas, production must necessarily be seriously curtailed and that, therefore, the volume of unemployment must be very considerable. On the other hand, though production in France, Belgium and Russia may diminish in many directions, what goods they do produce for export will find no market in Germany and Austria-Hungary and a proportion of them will find their way to this country. Such commodities will not only be valuable as food and raw material for industry, but will set up a flow of British goods in payment for them. Further, the production of commodities needed for the prosecution of the war, will increase the volume of employment. Goods of all kinds are required not only for the British armies but for the Allies generally. The manner and extent to which these factors have influenced unemployment will be considered presently. [Footnote 1: According to an Admiralty statement, corrected up to Sept. 23, 1914, 12 British ships had been sunk by German cruisers, 8 had been sunk by mines, whilst a few fishing boats had been destroyed. British ships detained and captured by Germany numbered 86, with a total tonnage of 229,000. On the other hand, 387 German vessels had been detained or captured, the total tonnage being 1,140,000. According to _The Times_ (Oct. 9, 1914), up to date 1.6 per cent of the tonnage registered in the United Kingdom had been lost. The figures for Germany and Austria were 18 and 13 per cent respectively. The Committee which prepared the State War Insurance Scheme estimated that the loss during the first six months of the war might be about 10 per cent of all British steamers employed in foreign trade.] [Footnote 2: _Round Table_, Sept. 1914, p. 704.]