Modern monetary systems

Bibliographic data

Monograph

Identifikator:: 1753210836

URN:: urn:nbn:de:zbw-retromon-128414

Document type:: Monograph

Author:: Nogaro, Bertrand http://d-nb.info/gnd/117039713

Title:: Modern monetary systems

Place of publication:: London

Publisher:: King

Year of publication:: 1927

Scope:: XII, 236 S.

Digitisation:: 2021

Collection:: Economics Books

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Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Part I. Modern monetary systems and their operation

Collection:: Economics Books

86 MODERN MONETARY SYSTEMS the influence of the exchange showed itself to be stronger than the contraction in purchasing power.” We confess that we do not share his surprise ; for we have always admitted that the quantity of money, whether real money or money of account, which is required for an increase of transactions due to a rise in prices will inevitably create itself. But the experience in Czechoslovakia is peculiarly instructive in that it gives some indication of the machinery by which media of payment spontaneously multiply. It must be remembered, of course, that the fiduciary circulation of Czechoslovakia, although strictly limited under the law of 1919, was nevertheless capable of expansion through an increase in the bank holdings of commercial bills, and that, as we have already seen, it did in fact increase by 509%, between February 1919, when it was stamped, and the end of 1921. But this increase is admittedly small compared with the rise in prices which nearly trebled during the same period. Therefore we must not only take into account the discounts and advances by the Banking Department which had them- selves increased much more in proportion than the secured fiduciary circulation; it rose from 656 million crowns in May 1919 to 4,337 million in December 1920, and remained thereafter at between 3 and 4 milliards. We must also and indeed mainly take into consideration other indices, such as the amount of clearings effected by the Prague Clearing House, which rose from 11,870 million in 1919 to 41,535 million in 1920. This increase in credit and transfer operations pre- supposes a corresponding rise in deposits, and the latter, in fact, took place, especially in the deposits of the postal cheque department, which rose from 21,284 million 1 Rasin, 0p. cit., p. 82. The author points out that during the year 1919 the aggregate of commercial bills presented to the Clearing House increased much more than nine times, whereas the crown had only depreciated to one-fifth of its value in comparison with 1914, and that in 1920 the same clearing operations had increased thirty-one times, whereas the currency had only depreciated to Xs of its value. He thus emphasised that the increase in clearings was a preponderating element in the expansion of media of payment necessitated by the rise in prices.

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