costs of manufacturing commodities and in the stocks of goods
held by wholesale and retail merchants, a liquidation of busi-
ness debts, low rates of interest, a banking position that favors
an increase in loans, and an increasing demand among invest-
ors for corporate securities. Now all these conditions are con-
ducive to a resumption of business activity, either because (like
the settling of old accounts) they remove obstacles, or because
(like the reduction of mercantile stocks) they promise a larger
demand for wares, or because (like low interest and low manu-
facturing costs) they widen the margin of profit, or because
(like the position of the banks and the attitude of investors)
they facilitate the borrowing of capital. Fundamentally, the
revivals of business must be ascribed to the processes that initi-
ate these favorable conditions.

The one exception in the history of our four countries within
more than twenty years is afforded by the harvest episode of
1891. Unusually large American crops of grain, sold at ex-
ceptionally high prices, cut short what was promising to be an
extended period of liquidation after the crisis of 1890 and sud-
denly set the tide of business rising. But in this single instance
the revival proved both partial in scope and brief in duration,
partly at least because the stresses that had led to the crisis were
not relaxed during the depression. ⁴ Over against this single
instance are set several instances in which revival began quietly
without the occurrence of any propitious event sufficiently
striking to impress itself upon the attention of contemporary
chroniclers; for example, the German revival in 1904-05 and
all French revivals since 1890. The attempt to account for busi-
ness revivals as the result of happy accidents therefore deserves
no more credence than the abandoned theory that crises are
"pathological" phenomena due to some "abnormal" cause. The
quiet processes of business recuperation during dull times are
quite competent to develop into revival without the adventi-
tious help of any "disturbing circumstance."

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