entirely abritrary taxation levied on business enterprises in towns — the 
‘transport-tax”, the tax on current cash levied in every household, the tax 
for municipal administration, the single impost on reconstruction work, 
etc. — all led to the circumstance that in Moscow and in large towns, 
65 0 of trade enterprises, as well as business agencies and small trade under- 
takings were closed in the autumn of 1924, which had originated in the 
early stages of the mew economic policy. 
To this time also belongs the final formation of the credit system still 
in existence at the present time. The credit system of the country consists of 
a State bank with a number of branches, of a bank for foreign trade, of a 
State bank at Moscow, of a Central Co-operative bank, of the Co-operative 
bank of the Union, of the Commercial and Industrial bank, of the bank 
for granting loans to agriculture, and of the Electro bank. Of all these 
banks, the following are at present of essential importance: The State Bank, 
the Industrial Bank and the Co-operative Bank of the Union. 
There were still a whole series of companies granting reciprocal credits 
and a few large private banking concerns, as well as a foreign commercial 
bank in which the Soviet Government was interested with capital. All these 
credit institutions, however, are now closed. 
The State bank, the Industrial bank and the Co-operative bank have 
received their capital from the Government, principally out of the balances 
of the nationalised values. Among their staff they have a certain number 
of experienced bank officials and leading personalities, whom the Govern- 
ment chose and selected with care, when it was preparing its monetary 
reform. 
The Commercial Exchange and the Stock Exchange, which originated 
during the first period of the new economic policy, degenerate later on into 
purely statistical boards of registration. 
The State industry continued to work at a loss, and experienced during 
this time, the pressure of the central power which insisted upon a reduction 
of demands made on the State budget: the Government attempted to build 
up a sort of State budget and began to reduce the subsidies paid to the 
industry; the trusts, on their part, begin to compensate themselves for the 
lotations from the State, by increasing their prices. In consequence of the 
pressure of the taxation screw and of the foreign trade monopoly, an 
wrresistable decline in prices for agricultural products begins at the same 
lime. Already from the beginning of 1923 arises a strongly marked disparity 
of prices between the urban and rural economy, — a new breach between 
town and country, — in this instance, in favour of the town. This is the 
so-called “price-shears” about the development of which, a detailed analysis 
will be given later when speaking about the present state of the Russian 
Q 1