SINCE the spring of I933 we have had occasion to call attention to the successive stages through which the Administration's program of inflation has progressed. It began, of course, with theextraordinary legislation concerning money, reserve credit, free coinage of silver, and the issue of Treasury notes, which gave definite notice of the policy and started anticipatory inflation of stocks and many commodity prices. But no Treasury notes were printed, no new currency was forced into circulation, and all that happened for some months was an inflation of reserve credit through purchases of government securities, made in the hope of stimulating the expansion of bank credit. But the business world was in no mood to borrow; and the many new, and frequently inconsistent, policies adopted by the Administration confused the business prospect and tended to impair confidence, so that anticipatory inflation was presently followed by a decided reaction in the summer of I933. In the fall, when this reaction had gone to a considerable length, the government began its extraordinary gold purchases at rising prices, which finally resulted in a price of $35 per ounce and the devaluation act of last January. But these measures, like the earlier ones, forced no new money into circulation; and, since they tended to impair confidence, made intelligent business men less inclined than ever to increase their borrowings at the banks: so that the inflation stimulant had not yet begun to work as the inflationists expected. Meanwhile other measures, not of a monetary character and in the mind of the ordinary observer not connected with the inflation policy, had resulted in an enormous increase in federal expenditures for public works, private relief, and other projects believed to be of unquestioned efficacy in stimulating recovery. Generically, these were described as priming the a term which continues to be used in spite of the fact that rivers of public money have been pumped through the Treasury into every state of the Union without starting a natural flow of water through the pump. In this process, little attention was given to the destructive effects of public money upon the valves of the pump, the condition of which depends upon public confidence and the spirit of enterprise. These would be immensely strengthened by the appearance of signs of natural recovery from terrible depression, but very certainly injured when such things as improvement in retail trade or increase in industrial activity are either suspected, or definitely known, to be due, at least in considerable part, to the outpouring of funds from the Federal Treasury. Under these circumstances favorable developments may be of an artificial character, and may be due to an unhealthy process which all intelligent persons know cannot go on forever. Whether any real recovery has occurred, and if so how-much, cannot be determined with any certainty until the outflow of public funds gradually approaches its end and it can be seen that industry is able to take up its normal load and carry on strongly and profitably. Since the government's expenses have been so large, and its revenues have not increased as much as anticipated by reason of the general recovery the Administration expected to bring about, economic conditions this fall, however much they may be above those of a year ago or those existing in the spring of I933, have proved a disappointment; and the entire recovery program is now being questioned as never before, and in part reorganized, although, of course, in such a way as to put the best face upon things and avoid admission of failure. It was under such conditions as these that the Treasury undertook its recent refunding operations. By way of preparation, various subordinates made addresses or issued statements intended to reassure the business world and reestablish confidence. But these inevitably had only a momentary effect, and could reassure only the unthinking or those able to think but unable or disinclined to use their memories. Meanwhile the condition of the bond market had become unsatisfactory, and dollar exchange had weakened; so that government funds were being employed in the purchase of government securities. On one day when the market was particularly weak, an obvious effort was made to 'rig)' the bond market by last-minute purchases con-