ments. Thus the price movements of gold standard countries are very similar (Figure 5), and the price movements of silver standard countries are similar; but the price movements of gold standard countries differ from those of silver standard countries as the ratio of gold to silver changes. Countries of exceptional standards have exceptional price movements. (Figures 6, 7, and 8.) During the World War the prices rose differently in different countries according to their different degrees of inflation.
8. Price Movements Vary with the Money Supply. The price level fluctuates largely with the fluctuation in the quantity of money. (Figure 9.) Great increases in the production of the money metals as in the sixteenth century and in the '50s and again in the '90s of the last century, are followed by great price upheavals. During the Great War the price level in various countries was found to vary with the quantity of money.
9. Kinds of Inflation. Besides the inflation from great issues of paper money, there is gold inflation, such as the United States experienced in 1915-1917; and credit inflation, such as all belligerents experienced.
10. Extent of War Inflation. Outside of Russia this is about threefold, money having increased from 15 to 45 billions and deposits from 27 to 75 billions. Prices have risen accordingly.
11. Money Illusions. Money always seems scarce even when superabundant. The individual always wants more than he has and is apt to think that a whole country would be benefited by more money. He doesn't realize that the more money there is the less it will buy. He keeps thinking of a dollar as fixed.
Some allege that gold is stable because its price is
