82 MODERN MONETARY SYSTEMS 
stances 1, had followed a general course in 1920,2 and by 
the middle of that year the internal depreciation of the 
currency seemed to have nearly equalled its external 
depreciation. 
In 1921 Englis, the Finance Minister, attempted to 
recover the mastery of the exchanges which had been lost 
with the fall of Rasin. At least in October of that year, at 
the time when a new collapse in the mark was taking place, 
all connection between the Czech and German currencies had 
disappeared, the former taking a definite turn towards a rise. 
It should be observed that #his recovery took place at the 
very time when the notes circulation, still legally limited but 
expanding with the volume of commercial bills, reached 
its highest point and exceeded by 4 milliards the amount 
of the notes in circulation before the reform. 
The explanation of this recovery lies, however, in a 
conjunction of favourable circumstances, partly political, 
which revived confidence abroad, e.g., the successful 
mobilisation at the time of the attempt to restore the 
ex-Emperor Charles to the throne of Hungary, and 
the evident return to social and financial order. To 
these were added certain economic circumstances, in 
particular the existence of a large export surplus which 
enabled the Banking Office to accumulate a large stock of 
foreign currencies and even a considerable amount of gold 
and silver coin and bullion, and to intervene more or less 
effectively on the exchange market.? 
The possibility of stabilisation might have been con- 
templated at this stage. But Rasin returned to power 
1 Through the American supply service an ample quantity of foodstuffs 
had been procured, the rate being 18 crowns to the dollar; ultimately, 
when Rasin was first in office, the exchange had greatly improved. 
2 See table showing 28 commodities published by the Czech Ministry of 
Food and reproduced in the above-quoted work of M. Piot, p. 143. See 
also Rasin, 0p. cit., p. 69, and Rist, “La déflation en pratique,” p. 94 ¢t seq. 
8 The stock of foreign currencies had reached 783 million crowns on 
June 30th, 1921, as compared with 14 millions in December 1919, and the 
gold and silver coin and bullion amounted to 555 millions at the same date. 
It may be added that, as the mark progressively depreciated, German and 
Austrian exporters asked of their own accord to be paid in crowns by the 
Czech purchasers, and with the accumulation of crown deposits a favourable 
element was added to the Czech balance of payments. Thus the recovery