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

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Part III. Monetary theory and its application in practice

Collection:: Economics Books

NORMAL EXCHANGES 219 must necessarily occur in a system which involves the same exchange fluctuations within the gold points and the same automatic changes in the volume of currency in so far as these factors depend in either case on international payments. § 3. Requisites for monetary reconstruction. Our conclusion therefore is that modern currency experi- ments show a gold standard system based on traditional systems but somewhat perfected in its application and more effective with an equal quantity of gold; none of the characteristics of a normal monetary system are absent from it. These experiments also indicate the way that should be followed in order to stabilise the exchanges by a return to the gold standard. Finally, the observation of present day events and in particular of recent monetary crises show how foolish it 15 to attempt to bring monetary equilibrium out of a continual disequilibrium of the exchanges by a paradoxical use of the classical theory. On the contrary, it will be seen that >. > first condition for any future stability lies in the stability of the exchanges ct avy given moment, which eliminates the influences of political factors, obviates the dangers of a panic, facilitates the placing of credits abroad and, lastly, allows a discount policy again to come into play. Only a rational and methodical monetary policy which has as its object the re-establishment of the external con- vertibility of notes can put an end to the world crisis in ex- change. A courageous fiscal policy and the stoppage of inflation are of course necessary adjuncts; but they are in- sufficient; for, taken by themselves, they presuppose the main- tenance for an indefinite period of the abnormal and revolu- tionary régime of inconvertibility, with its inevitable corollary of unstable exchanges ! While convinced of the necessity of balancing the Budget in a country which desires to restore its finances, we confess that we cannot discover on what arguments Rist bases his statement that “no bear speculation can affect the currency of a country whose finances are in equilibrium” (op. ¢it., P- 37)- It is true, of course, that Budget equilibrium will constitute a psychological element in keeping the exchange right: it is also true that the

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