TO DISCOVER A STABLE STANDARD 189 
United States dollar, and which thus permits the payment 
at a given date of a sum corresponding to a given number 
of dollars and of the subsequent reimbursement of a sum 
which may be very different but corresponds to the same 
number of dollars, is easier to understand than the system 
which consists of providing at a given moment for the 
payment of a given sum in depreciated currency such as 
the mark, and the reimbursement of the same sum mul- 
tiplied by a coefficient representing the change in its pur- 
chasing power, i.e., the change which has taken place in 
average retail prices. Nevertheless this method of setting 
up contracts figured in gold is less logical for internal 
transactions because the correcting coefficient, instead of 
being based directly on variations in the purchasing power 
of the currency, is, in fact, based on variations in the rate 
of exchange between this currency and some foreign cur- 
rency which has remained at gold par. And we have ob- 
served that the exchange curve and the curve of purchas- 
ing power do not usually coincide exactly. 
In cases of rapid depreciation the same method is ap- 
plied to all kinds of contracts. We have seen that in coun- 
tries, like Poland, Austria (up to the monetary reform of 
1922) and Germany, the commerical world contracted the 
habit of fixing their prices according to the rate of the 
dollar and continually changed the tickets on their goods. 
And so we arrive at the theoretical conception of a 
curious system under which variations in purchasing 
power are neutralised by applying to all debts and credits, 
whether among private persons or as between private per- 
sons and the State, a coefficient varying according to the 
date at which they fall due. 
In practice it will be observed that this adjustment 
works very unequally according to the character of the 
obligations. Returns from che sale of goods will change 
more or less in proportion with the price of those goods 
if the market is not restricted, and the seller, by increasing 
his price, may find some compensation for the general 
decrease in the purchasing power of the currency. He is 
bound, however, to take into account a possible decline