90 MODERN MONETARY SYSTEMS 
with that object, to balance the budget. It involved an 
external loan (650 million gold crowns) which had been 
considered necessary chiefly in order to assist the Govern- 
ment in meeting the immediate deficits, but it contained 
no explicit provision for making the crown convertible. 
The scheme included the creation of a new Bank of 
Austria, with the task of re-establishing normal conditions 
in the issue of notes, with a cover in gold or stable foreign 
currencies, beginning at 209, and rising at the end of 
15 years to 33%. 
The new Bank of Austria was created on November 
14th, 1922; the printing of notes was stopped on 
November 18th, 1922 ; credits were immediately placed 
at the disposal of the Austrian Government,! and enabled 
the Bank to be provided immediately with the means of 
making foreign payments—a necessary step in order to Support 
the exchange. The exchange, which had fallen to oroooco14 
on New York, was henceforward maintained at this rate, 
which is equivalent to the new parity of approximately 
14,000 paper crowns to the gold crown. With the revival 
of confidence abroad and at home in the currency which 
had again become a medium of saving, #his process of 
stabilisation caused the repatriation of capital and a flow of 
foreign investments, which soon took the form of an abundant 
supply of foreign exchange on the Vienna marker? 
During 1923 the Government stopped throwing 
foreign currencies on the market; the National Bank of 
Austria on the contrary bought up the surplus of foreign 
currencies over market requirements, and this both increased 
its reserves and prevented the crown from rising above the 
fixed parity; the Bank did not hesitate to make further increases 
in the note issue in order to make such purchases? 
1 These credits were obtained by means of Treasury bills issued up to 
60 million gold crowns to be covered by stable foreign currencies, and by 
70 millions from abroad, 50 millions being taken out of the remainder of 
certain advances already made by France, Italy and Czechoslovakia. 
2 See Sixth Report of the Commissioner General of the League of 
Nations at Vienna of July 9th, 1923. 
3 See Seventh and Eighth Reports of the Commissioner General of the 
League of Nations at Vienna.