Modern monetary systems

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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 II. The explanation of contemporary monetary phenomena and currency theory

Collection:: Economics Books

THE THEORY OF EXCHANGE 141 This suggestion certainly conforms to the classical doc- trines about money, and if we take an instance like that of the assignats we shall indeed see that on the whole! the premium on metal, as registered either by the French exchange at Bile or by internal transactions such as pur- chases of bullion by the Treasury itself, was, above all, governed by the expansion of the currency. But when we come to consider closely exchange pheno- mena of recent date we shall observe that internal depre- ciation as revealed nowadays by the movement of prices alone, and external depreciation as revealed by the loss on ex- change, have become entirely distinct phenomena, the curves of which, far from coinciding, are not even parallel, so that fluctuations cannot be attributed necessarily to the same causes. On the other hand, we have seen how the classical doctrines about exchange, being doubtless based on precedents which are not recent, have remained some- what indefinite, and with the vague idea of depreciation, which includes both a decline in internal purchasing power and a loss on exchange, has admitted, a priori, that Quan- tity may exercise an influence which still needs to be demonstrated and is supposed to make itself felt in widely different circumstances. Indeed it is not enough to have some confused notion that a currency which is considered to have lost its internal value because it has been over- expanded, or to have recovered that value because it has been contracted, has for the same reasons a greater or smaller value externally and will therefore suffer a greater or smaller degree of loss on exchange. We must find out whether this supposed internal depreciation and its fluc- tuations appear in the movements of prices ; if so we must make certain that we have reason to presume and are able to prove that this internal depreciation is connected with the loss on exchange. 'As we have shown above, the agio did not always move with the expansion of the currency, there were numerous exceptions; but if we take the main stages in this process of inflation we shall find that the extreme rise in the agio did correspond on the whole to the increase in the amount of notes issued.

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