But civilized nations are not hermit nations. They live by mutual help, by mutual trading. They deal with each other and they deal on the system of barter, in the absence of an international currency. Gold is a species of barter and passes from nation to nation in all respects like an ordinary commodity. Imports are paid for by exports, and exports pay for imports. When, however, a country imports more than it can pay for in exports, it must either cease to import, or pay for the excess in gold, securities, or some other form of payment. If it has to pay in gold it may be living beyond its income and be paying for its exports out of capital. If the gold be hoarded and the paper currency be multiplied and inflated an automatic rise in prices results. This is tantamount to a depreciation of the paper currency, for this currency can then purchase less. What is called the credit of the nation falls. That is to say, belief in its soundness weakens. This encourages imports from foreign countries and discourages exports, and the indebtedness to foreign countries increases. Should this go on indefinitely, the country will get deeper and deeper into debt and nearer to insolvency. It will have to pay for its imports with its gold, or stop importing. And if it stops importing, it might stop importing vital products. Powers of production and consumption will necessarily weaken, and that country will get into the plight Germany has got into. In time its credit and currency will become so debased that foreigners will not risk exporting commodities, lest they should lose more than they gain, for the debtor country’s paper will become of less value. In the case of Russia, her currency also became depreciated in terms of sterling value. This arose from a different cause. Russia’s exports to England and other countries were stopped by the closing of the Baltic Sea and the Dardanelles. A little went by the Archangel route, but, of course, it was wholly inadequate. Russia, therefore, was unable to liquidate her national indebtedness by her exports, and the exchange went so greatly against her--that is to say, the rouble became so greatly depreciated in terms of our gold currency--that it was impossible for Russian merchants to get remittances to send to this country to liquidate their indebtedness here.