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 I. Modern monetary systems and their operation

Collection:: Economics Books

42 MODERN MONETARY SYSTEMS money the habit was acquired of never demanding the re- imbursement of notes in order to bring gold into circula- tion, and the Conversion Office ix fact played the part of an exchange office, similar to the one at Manilla. For the same reason, anyone receiving gold from abroad was naturally led to deposit it with the Conversion Office, and with- draw in exchange the notes which constituted the normal internal currency.! The monetary system of the Argentine may therefore be said to be identical with the gold exchange standard of the Far East except that the internal currency, consisting only of notes, was entirely fiduciary in character, and that the Conversion Office supplied gold on the spot to those who were obliged to export it, instead of issuing a draft drawn on a gold deposit held abroad. But this last variation, which merely involves a question of form, also brings out the fundamental similarity between the traditional gold-standard systems and this 7égime, which contained nothing new except in some of the subsidiary methods used. Indeed the only difference was that, in the new gold-standard system, gold, instead of being partially brought into internal circulation, was reserved for any requirements in connection with foreign payments. But as the internal currency was freely convertible, this stock of gold could be used up to its last ounce for payments abroad, and iz is only the traditional effect of the gold points which stabilised the exchanges with all other countries having gold currencies. For the right to obtain gold at the rate 1 It may be pointed out that under this method the currency tends to expand when the Trade Balance shows a credit—one element in a favourable exchange position—and to contract in the opposite event. In fact, we have here another analogy with the system of the gold exchange standard in the Far East. This provision does not, however, appear to have been dictated by the desire to bring about an automatic contraction and expansion of the currency; for the originators of the system were more experienced and practical than the Anglo-Saxon theorists who described the gold exchange standard. It will, moreover, be observed that, without affecting the exchanges, the working of this system more than doubled the fiduciary currency of the Argentine in the decade following the creation of the Conversion Office, a rate which seems more than proportional to the Increase in transactions.

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