s, then unemployment will also result. Such intervention cannot take place without disastrous results, at least not within the framework of an exclusive currency. 8. Another faulty approach, used in the German 'currency reform" of 1948, was to issue only per-head-quotas of the new currency and not to exchange at all or only at a reduced rate, large amounts exceeding this quota. Not only the money covered by the quotas but also the unrecognized funds were expressed in the inflated prices. Thus there follows, inevitably, a sharp deflation, a deprivation of currencies, at least in certain spheres. It would be very unlikely for such a quota plan to exactly determine quotas corresponding to the market requirements - and it could never do justice to individual money holders. Only a complete exchange at market rates could do that. The only fair currency reform would be to withdraw the old currency only by and by, while it is being gradually exchanged for the new currency, at the going market rate, 9. Trouble will also arise if one insists on gold payments and gold redemption funds for all paper money and all clearing transactions and on recognizing the claim of creditors to demand the nominal gold value in real gold from their debtors, when the debts fall due, regardless of the availability of gold to them - instead of merely granting them a right to clear and reckon or account in gold weight units accepting or issuing other than gold coins or gold certificates in payment - at their, gold value on the free market. 10. Another vain attempt to end inflation and stop unemployment consists in issuing a new currency only to the extent that foreign loans can be obtained as a "cover" for the new currency. These loans would stand in no direct relationship to the currency required in this country at this particular time. They are likely to fall short of these requirements and thus this "reform" would be likely to lead to deflationary under-issues of th...
