CONTENTS 
§ 3. BANKS AND PRICES . \ 
X1 
PAGR 
« 79-85 
Economy of currency effected by banks : . 79-80 
Not to be measured by the magnitude of deposits . 80-81 
Deposits do not form an addition to the currency . 81-3 
Banks do not control prices except in a very limited 
and temporary sense  . 83-5 
§ 
THE EFFECT OF ** COVER ”’ ON THE VALUE OF 
PaPER CURRENCY . . 
When the paper is convertible 
When it is inconvertible 
+ 
$s. 
“ SCARCITY OF COMMODITIES ”’ AS A CAUSE 
oF Higa PRICES . . 
85-9 
85-7 
87-9 
89-91 
A diminution of commodities other than money would 
be a reason for diminishing, not for increasing currency 8g 
Fluctuations in the plentifulness of commodities are 
negligible " 89-qg1 
PART III. THE RECENT HISTORICAL 
EXAMPLE 
§ 1. PRICES RECKONED IN GOLD 
. 92-3 
Have risen in consequence of diminished demand for 
gold 
92-3 
§ :. PRICES RECKONED IN PAPER . . .93—107 
Booms created by the optimism of private persons 
are short-lived, because such persons cannot create cur- 
rency to pay with . . . ‘ . . 
But governments maintained by liberal creations of 
paper currency the boom which was started by the 
promise of enormous expenditure on the War. . 06-8 
The supposed advantages of this were delusive 98-9 
And the disadvantages enormous . . C9~-101 
Reintroduction of limitation of currency in Great 
Britain in 1920 . 101-7 
93-6