64 MODERN MONETARY SYSTEMS 
of 1920, and 122 milliards at the end of 1921. It might 
be supposed that, given this complete absence of assets, the 
German financial system must have had an unfavourable 
influence on the value of the mark ; but after having de- 
preciated by 50%, at Amsterdam at the end of 1918, and 
by nearly 90-89, at the end of 1919, the mark was nearly 
back at the latter rate at the end of December 1920, with 
a depreciation of 92-109, as against 94:79, in January of 
the same year and 87-59, in June.l Even internal prices 
which had only been recorded in Germany since 1920 had 
varied little in the course of this year; the index moved 
from 1446 in August to 1437 in December, after having 
reached 1506 in November, and remained at a lower level 
during the first seven months of 1921 (official index of 
wholesale prices). 
The connection commonly supposed to exist between fluctua- 
tions in the exchange, the note issue and prices is therefore 
not apparent during this period; the comparative stability 
of the exchange may, however, be partly attributed to 
certain steps taken by the Reichsbank and the German 
Government.? 
But although, as has just been shown, the note issue in- 
creased very considerably between 1918 and 1921 with- 
out any appreciable fluctuations in the exchange or in 
internal prices, it is no less remarkable that, from the 
second half of 1921 onwards, the exchange rates and 
prices rose concurrently and far out-distanced the note issue, 
which, in spite of the activity of the Government printing press, 
never increased in proportion to the rise in prices. Whereas 
on June 30th, 1921, the percentage increase in prices was 
only 2:19, of the corresponding figure for the previous 
quarter, the note issue having increased by 59 the 
position is reversed as soon as prices begin to follow the 
exchange. This is shown by the table on p. 65. 
Thus the monetary crisis in Germany shows on the 
whole that the internal price fluctuations were narrowly 
1 The loss on New York was rather more than 959%, at the end of January 
1920, 89%, in June, and 94'1%, in December. 
2 See Rist, Revue d’ économie politique, 1921, p. 73.