The Foreign Exchange Problem (Paperback)

This historic book may have numerous typos and missing text. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1921 Excerpt: ...Crisis in England. 1865 End of Civil War. 1866 Crisis in England. 1870 Outbreak of Franco-Prussian War. 1873 World Crisis. 1907 World Crisis. 1914 Great War. INDEX NUMBERS OF PRICES For explanation and comment on this chart see previous page. Factors which have Lowered the Foreign Exchange Quotations (c.) SPECULATION. Some of the exchange fluctuations have been accounted for by the rapid changes in the relative prices of merchandise due to currency disorders. But the paramount cause for the violent oscillations of the exchange rates lies undoubtedly in the extensive speculation. The outstanding credits in the form of bills of exchange, deposits in European banks, open accounts, and finally in European currency (held in countries other than those in which they are legal tender) form a constantly dangerous and incalculable element in the foreign exchange markets. The exportation of currency by European countries has been especially serious. Considerable quantities of such monies, particularly francs, lire, marks, Austrian crowns, and rubles, are being held by the former neutral countries (Switzerland, Holland, Spain, Sweden, Norway, and Denmark). Since the armistice citizens of the former belligerent countries themselves participated in this speculation to quite a considerable extent. Either as a reinsurance against apprehended risks incurred in connection with their business transactions or the administration of their fortunes ("the flight of capital"), or simply as a matter of speculation, they went long or short on foreign currencies. Such operations were, however, often restricted or forbidden by the laws of their country. Quite frequently too, the proceeds of merchandise exported from one of the European countries to another, instead of being r...