" " 17.5 " "
" 5.0 to 2.5 " " 19.0 " "
" 2.5 to 0.0 " " 20.5 " "
]

[Footnote 9: The complete application of the new rule is deferred for
a period of three years from the passage of the act.]

[Footnote 10: See on "piping" provision, sec. 2, above.]

[Footnote 11: See sec. 7 above.]

[Footnote 12: Several other features of the law well merit
description. Among these features are measures for developing bankers'
acceptances, open market operations, the gold clearing system of
the Federal Reserve Board, and the clearing of checks and parring of
exchange.]

CHAPTER 10

CRISES AND INDUSTRIAL DEPRESSIONS

Sec. 1. Mischance, special and general, in business. Sec. 2. Definitions.
Sec. 3. A feature of a money economy. Sec. 4. European crises. Sec. 5. American
crises. Sec. 6. A business cycle. Sec. 7. General features of a crisis.
Sec. 8. "Glut" theories of crises. Sec. 9. Monetary theories of crises. Sec. 10.
Capitalization theory of crises. Sec. 11. The use of credit. Sec. 12. Interest
rates in a crisis. Sec. 13. Dynamic conditions and price readjustments.
Sec. 14. Tariff changes and business uncertainty. Sec. 15. Rhythmic changes
in weather and in crops. Sec. 16. Remedies for crises.

Sec. 1. #Mischance, special and general, in business.# Every separate
business enterprise is subject to chances which suddenly decrease
its profits and the prosperity of its owners; such are fire, flood,
illness of its owners, unfavorable changes in prices of materials
or of the products.[1] The interests of many other persons in the
neighborhood may be so bound up with an enterprise that its losses may
mean unemployment, lower wages to workingmen, and bankruptcy to local
merchants and to banks. Sometimes misfortune and disaster affect whole
communities. The lack of cotton while the Civil War was in progress
compelled the factories of Manchester to close in 1864, and the
earthquake and fire in San Francisco in 1906 left a quarter of a
million people homeless.

But a change of business conditions is constantly occurring that is of
wider extent, that is of less accidental and of more rhythmic nature,
and that appears to be the effect of slowly working and more general
causes. The enterprise of a modern community, as a whole, "general
business," moves along, in a wavelike manner, going through a somewhat
regular series of changes that is calle