The“cycle“ofexaltation，crisis，anddepressionhasfrequentlybeendescribe。PerhapsaseffectiveadescriptionandanalysisasanyisthatofTugan-Baranowsky，Handelskrisen，chap。
Cf。，however，Cassel，“OmKriserochDaligaTider，“EkonomiskTidskrift，vol。vi，no。2，pp。69-78。
As，e。g。，theeraofprosperity1897-1902tookitsstartfromthedemandforsuppliescausedbytheSpanish-AmericanWar，thoughotherfavorablecircumstancesactedtogiveitvolume。MrCarver，possiblyfollowingsuggestionsgivenbySpiethoff’sdiscussion，hassuggestedthatthelinesofbusinessinwhichthefavorableinitialdisturbancearisesarenecessarilythoseengagedintheproductionof“producer’sgoods“；thereasonforthisbeingthat，inthenatureofthecase，“thevalueofproducer’sgoodstendstofluctuatemoreviolentlythanthevalueofconsumer’sgoods，“inasmuchasthevalueofproducer’sgoodsvariessomewhatasthemagnitudeofthemarginofprofits，whilethatoftheconsumer’sgoodsvariessomewhatasthemagnitudeoftheentiredemandonwhichthismarginofprofitsrestsasanincrement。Thevalueofproducer’sgoods=fdelta，thatofconsumer’sgoods=fdemanddelta。Fromthelikelineofargumentitshouldfollowthattheinitialbreakintimeofcrisismustcomeinsomelineofbusinessoccupiedwithproducer’sgoods。Cf。QuarterlyJournalofEconomics，Mayl903，pp。497-500。Seealsofoot-noteonp。181above。
9。Cf。Sombart，Kapitalismus，volII，ch。I，onthemotiveforcesatworkinadvancingbusinessenterprise。
10。The“intitialdisturbance“herespokenofmayofcoursebeofaprogressiveorrecurringcharacter，andsomaykeepthedifferentialadvantagegoinginaprogressivemanner，as，e。g。，inthecaseofaprogressivedemandforsuppliesduetoaprotractedwarortoaperiodofcontinuedpreparationforwar，suchashasoccurredinAmericaduringthelastfewyears。
11。Thereisapointortwooffurtherdetailinwhatmaybecalledthemethodofprosperityandcrisis，whicharebestdiscussedinconnectionwiththephenomenaofdepression。Thesewill，therefore，betakenuppresently。Theabovecharacterizationofaneraofprosperityandthemannerofitsexhaustingitselfwillserveasadescriptionofthecoursewhichsuchaneratakesundertheregimeofthemorehighlydevelopedbusinessmethodsofthehightideofthenineteenthcentury。Fortheearlier，lessfullydeveloped，businesssituationoftheearlynineteenthcenturythecorrespondingcourseofeventsrunssomewhatdifferent，owing，chieflyatleast，1toaslowerrateoftransmissionofanypricedisturbance，and2tothegreaterrangeandvalueof“outlying“industrieswhichareverytardilyifatalldrawnintotheexuberantmovementofprosperity。Inthisconnectionitisworthnotingthatduringthisearlierperiodofthenineteenthcenturytheproductionofspecificallyproductivegoodshadnotbeencarriedtothepointafterwardattained，eitherinthedifferentiationandspecializationofindustriesoccupiedwiththisclassofgoodsorintherelativevolumeofthisclassofindustries。
12。Theseveralphasesofthissequenceofexaltationanddepressionforanygivenbusinessconcern，maybestatedasfollows:-
Letea=earnings；pr=salepriceofoutput；exp=expensesofproductionofoutput；mar=marginofgainonoutput=pr-
exp；cap=intitialeffectivecapitalization；yp=year’spurchaseatcurrentrates=int=1/int，disregardingrisk；cr=normalcreditextensionongivencap=cap/n=fcap/int。
Thenattheinitialphase，ea=mar=pr-expoutp，cap=eaxyp=ea/int，cr=cap/n，Atthesubsequentphase，ofexaltation，ea’=eadeltaea=mar’xoutp=[pr’=prdeltapr-exp]outp=mardeltamaroutp>ea，cap’=ea’/int=eadeltaea/int>cap，cr’=cap’/n=capdeltacap/n>cr。
Attheconcludingphase，ofdepression，ea’’=ea’-deltaea’=mar’’xoutp=[pr’-exp’=expdeltaexp]outp