104 THE COMPANIES ACTS

unproductive project should be able, by bidding a
high price for capital, to forestall the demand of the
more useful producer. And with regard to the issue
of foreign securities, there is this to be said, that
foreign securities placed in London have the same
effect upon foreign exchange as the import into
England of goods shipped from any country ; that
is to say, for the time being they turn the exchange
against us. On the other hand, it is a well-known
commonplace that imports of securities have to be
balanced by exports of goods or services; and as
the times when our export trade is most active are
those when most foreign securities are being placed
in London, it follows that any restrictions placed
upon the issue of foreign securities in London will
hinder rather than help that recovery in our export
trade which is so essential to the restoration of our
position as a creditor country.

Moreover, our rulers must remember this, that
in War-time, when all the letters sent abroad are
subject to the eye of the Censor, it is possible to
control the export of British funds abroad; but
that in peace time (unless the censorship is to con-
tinue), it will not be possible to check foreign invest-
ment by restricting the issuing of foreign securities
in London. If people see better rates to be earned
abroad and more favourable prospects offered by
the price of securities on foreign Stock Exchanges,
they will invest abroad, whether securities are issued
in London or not. As for the curious suggestion
that the profits of industrial companies are hence-
forward to be limited and the whole balance above