In discussing wealth two important facts must be kept constantly in mind. First, the wealth of an individual may or may not be wealth in a social sense. Second, an increase in wealth may, owing to increased prices, be accompanied by a decrease in the world's supply of commodities. On first thought most of us would say that the wealth of any society is composed of the total wealth of its individual members. Such, however, is not the case. The execution of a real estate mortgage, while it places in the hands of the owner evidence of wealth from which he may derive an income, has not added a single item to the wealth of society. It shows merely that one party has temporarily given up his command over a portion of social wealth, which in most cases of this kind is money. Some forms of individual wealth may even represent a positive decrease in social wealth. Such are government bonds sold to carry on war. Clearly, then, it is a mistake to attempt to estimate the total wealth of any large social group by adding the wealth of its individual members.

Nor does an increase in social wealth necessarily indicate that there has been an increase in the number or amount of commodities possessed by this same society. Here again we are likely to be misled by our first thoughts on the subject. An over-abundance of wheat, for example, though it should make bread cheap and plentiful, might well cause the total value of the wheat to be less than would be the case if but one-half or one-third of the amount had been raised. Conversely, a shortage in wheat might well raise the value of the total crop, also the value of the land on which it is produced, far above the values based on normal yields. In any case, there is no exact relation between the wealth of a social group and its stock of commodities; and for that reason we should not be hasty in concluding that a wealthy community or country is necessarily prosperous.