208 MODERN MONETARY SYSTEMS 
easily serve as an instrument of exchange and as a uni- 
versal standard. In any case it will be admitted that as 
gold ceased to be indispensable for international settle- 
ments the public would come to attach less and less 
practical importance to the existence of the metal “cover.” 
But we shall avoid attempting to deduce any practical 
scheme from these ideas, first, because it would be useless 
at the present moment 1n any case to forecast the creation 
of an international bank of issue, and, secondly, because 
such a bank with a world-wide privilege, while it would 
doubtless easily fulfil its monetary functions, could only be 
substituted with great difficulty for the national banks of 
issue in so far as their task of regulating credit is concerned. 
And so, even admitting the creation of an international 
fiduciary currency which is conceivable (in spite of certain 
objections)! it does not seem possible to include in any 
practical plan the complete substitution of such a currency 
for the existing national currencies. Therefore we must face 
the problem of monetary reconstruction by taking as a basis a 
monetary system similar to that which existed before the war. 
In other words, we must assume that zationa/ monetary 
systems will continue to exist parzly involving paper or 
silver currencies which only circulate at home and parsly 
involving a currency which circulates abroad and can be 
freely exported and which, for the present, is gold and 
gold alone. 
Such a system implies that there exists virtually an exchange 
problem; for when any sum of money circulates at home 
but cannot be used for purchases abroad, the question of 
convertibility necessarily arises in regard to international 
payments. And upon the way in which this question is 
settled will depend the solution of the problem of the ex- 
change. If gold is hidden or cannot be exported, the cir- 
culation of a country is in fact entirely inconvertible, for 
even gold currencies are only international currencies if they are 
1 See in Le Monde Nouveau, June 1919, an article by the author on “Le 
probléme des réglements internationaux et 'idée du billet international,” 
in which he has merely intended to point out the theoretical possibility of 
an international issue of fiduciary currency.