these expenditures could not possibly be covered by an increase of the income 
of the people. Purely technical methods of covering deficits by new issues 
are therefore unavoidable and lead to a disarrangement of the monetary 
system. In the U.S.S. R., one is beginning to realise the reasons for the 
loss of purchasing power of the Cherwonez-rouble. But since the radical 
removal of these reasons is only feasible in a complete reconstruction of the 
orinciples and foundations of the U.S.S.R.’s political economy (which 
would be tantamount to the complete removal of the “Socialism in a 
country’), it was prohibited — wap to very recent times — to write about 
the above elucidated facts which caused the destruction of the Cherwonez. 
The periodical “Bulletin of the Conjuncture Institute in Moscow’, which 
made the attempt to call the attention of the Government to the cause 
of the danger that threatened the currency, was prohibited at the beginning 
of 1928 just for this reason. In spite of this fact, the reviewer in the 
latest book, the “Economic Review” (June 1928), is compelled to come to 
the same conclusion in regard to the first half of 1927/28, when he says: 
‘The purchasing power of the monetary unit is diminishing.” (No. 6, 
5. 127, 1928). 
The following official figures published (“Ekonomitsheskoje Obosrenije’’, 
No. 8) in September 1928 by Prof. Perwushin, go to show the latest 
state of the Soviet currency in comparison with the previous vear. 
The third quarter of the economic year. 
(April, May, June.) 
[he Increase of Currency 1926/27 . . . . . . 135.7 mill. roubl. 
1921/28 182.8 ,, 
In order to estimate the figures correctly, it must be added that, 
according to the plan, the issue during the third quarter was not to exceed 
125 mill. roubles. 
The Covering for the 
Bank-notes 
The Reserves 
1926/27 
1927/28 
1926/27 
192/28 
30.7 % 
26.4 % 
102.7 
71.8 
The above mentioned Professor finds that the cause for the persistent 
downard tendency of the Cherwonez — in addition to the failure in 
export of grain — is due to the “very difficult condition” of the textile 
industry. This, however, also applies to the whole industry. The constantly 
increasing, badly organised and costly building activity has called forth a 
demand for money, not provided for by the plans, more especially as the