PEESENT MONETARY PROBLEMS. 



219 



and the quantity-theory has led to some new and surprising formula- 

 tions. It has been the hope of the bimetallists to secure a parity of 

 exchange between countries now using gold and silver standards. If 

 gold could be maintained permanently at a given ratio with silver, this 

 happy result might have been brought about. It is needless to say 

 that bimetallism proved to be a political impossibility, even in the 

 countries of the Latin Union. By force of business requirements, such 



silver as has remained in general circulation was effectively kept at a 

 value in gold equal to its face value by varying devices in different 

 countries, all of which had a common principle — practically equivalent 

 in a more or less evident form of redemption in gold. In the case 

 of India, it is frankly accepted that the value of the rupee has been 

 maintained at a fixed price in gold by a machinery which amounts to 

 the establishment of the gold standard, involving a quasi-redemptlon 

 of silver rupees in gold at 16d. 



If, however, there are some silver-loving sensibilities to placate, 

 such a process is not spoken of as the establishment of the gold 

 standard through the indirect redemption of inferior silver by gold, 

 but it has been discovered that a uniform ratio of exchange between 

 gold and silver-using countries can be established, not by the gold 

 standard, but by a ' gold-exchange standard.' In the recent proposals 

 laid before Mexico and China this new form of statement has been 

 employed. It is difficult to know what the new term means. A bill 

 of exchange in a silver country drawn on a gold country is nothing 



