ABSTRACT
We must face hard facts. We cannot finance ourselves by inflationary methods which, if they gave relief for a certain period to an embarrassed Exchequer, would be followed with certainty by a collapse in the purchasing power of our currency, so that the loans we could raise would represent little in buying power. We cannot continue to lose gold in great quantities indefinitely or we shall find ourselves in a position when we should be unable to wage any other war than a brief one. There is a limit to the rate at which we can raise money, and that limit to the best of my judgement, is already reached. We can go on for another six or nine months if there are no further additions, but thereafter, unless something unexpectedly favourable happens, it may well be that the present rate could not be maintained.
