High rates persisted throughout the decade, with the result that currency in circulation dropped impressively, falling by almost 21 percent from 1920 to 1929. One must consider that high bank rates in a time of falling prices were much higher in real terms, since they had a large deterrent eff ect on investment by creating expectations of falling prices and thus falling profi ts. Th is was the typical defl ationary spiral that haunted Britain for the decade.

Clara E. Mattei, The Capital Order, loc. 1697