Reply.

This article presents the author's views regarding the critique by professor Clarence L. Barber on his article "The Cyclical Turning Points in an Open Economy: Canada, 1927-1939." The author argues that much of the disagreement between him and Barber and arises from differing treatment of the basic statistics. Barber has worked from seasonally corrected data, whereas the author has preferred the original series. In addition, in some of his citations Barber seems to prefer annual averages, whereas the author has stressed the monthly details. Barber is also unconvinced that the declining prices in the pulp and paper industry could have been significant, particularly since the value of production and exports continued to increase. However, following the 1928 newsprint price war the Canadian index of the prices of securities of paper companies dropped from 160.0 to 97.1, while the entire index of Canadian stock prices rose from 177.0 to 227.3. The price drop put pressure on profit margins, and led to widespread bankruptcies in the industry after 1929.