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192 ECONOMIC INQUIRIES AND STUDIES
and one or two great powers such as France, Germany,
and Russia, the commotion at first would probably be
somewhat greater than anything that was indicated
even by what happened in France at the time of the
Franco-German war. At that time all the markets
were steadied by the neutrality of England, in which
lay far and away the biggest market for securities at
the time. A war in which England would itself be
engaged would be one in which the same equanimity
could not prevail in the general markets for securities,
because it is the country of the chief market which
would be concerned.
I should be inclined to assume, then, following the
precedent of 1870, that the outbreak of a great war in
which England itself would be engaged, would depress
the price of first-class securities even more than the 10
per cent. which was the measure of the difference to
France at the beginning of its war with Germany.
The difference perhaps would be not less than about
IS per cent.
In support of the latter view it may be pointed out
that as the war between France and Germany pro-
gressed, and indicated a greater danger for France than
had been at first anticipated, the 3 per cents. quickly
fell to the price of 53, which was the price just after
Sedan and the beginning of the Siege of Paris. Just
for the reason that there would be no outside market
to support prices, such as there was in England in
1870 when the Franco-German War broke out, any
great calamity happening to England must have a
greater effect on the market for English stocks than
the calamities which happened to France in 1870 had
upon French stocks.
On the outbreak of war, then, between England and
other countries, there is fair reason to expect in this
view that the price of first-class securities all round
would fall something like IS per cent.; and my special
contention now is that in English Government securi-
ties in particular, owing to the market at the present