Inflation and Stabilization 
11 
mediate stabilization in the neighborhood of the 
actual values of the currencies. Of course, a very 
moderate form was given to this resolution. It met 
with opposition, nevertheless, and the Latin coun- 
tries, with France at the head, solemnly declared 
that they would never accept a depreciated value 
of their currencies, but would struggle on to the 
last with a view to restoring them to their pre- 
vious gold parity. We know the result. Some years 
were lost, in which inflation was allowed to develop 
still further, and in which not only the countries 
concerned but the whole world suffered from the 
insecurity of the value of unstabilized currencies. 
It is worth while to remember also from those 
years a curious argument that was used against 
the program of stabilization. It was simply said 
that stabilization was a theoretical program, im- 
possible to carry out in practice. The same people 
who made that statement put forward the restora- 
tion of the currency to its old gold parity as the 
only program that could be effectuated on the 
ground of practical experiences. Here we have a 
contradiction that serves particularly well to 
throw light upon the deepest foundations of the 
theory of money. A gold standard is, as I have 
already said, nothing else than a paper standard 
kept in a certain parity with gold by aid of a