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 prominent exponents could generally be identified either as extremely practical men who were interested in the price of silver, or as very inexperienced theorists. The difficulty of the two standards was successfully solved by discarding the use of silver, and the chief silver-using countries adopted a gold standard which has given greater security for the investment of foreign capital, has simplified business and brought about a large increase of trade.

In the case of a country of which the government has been subject to great financial difficulties, gold has been shipped to satisfy foreign creditors so long as the supply held out, and the exchange with such a country will continue to move adversely with every fresh political embarrassment and any other economic cause reflecting on the national credit. With the collapse of the monarchy in Brazil the value of the milreis fell from 27d. to 5d., and all the Spanish-American countries have from time to time afforded most distressing examples of the demoralizing effects on the currency of unstable and reckless administration. In Europe similar results have been shown by the mistrust inspired by the governments of Spain, Greece, Italy and some other states. The raising of revenue by the use of the printing press creates an inconvertible and depreciating paper currency which frightens foreign capital and severely taxes the unfortunate country which must make payment abroad for the service of debt and other obligations. With the tardy appreciation of the old proverb that “honesty is the best policy” nearly every country of importance has made strenuous efforts to improve the integrity of its money.

Exchange quotations are not published from many of the British colonies, as their financial business is in the hands of a comparatively few excellently managed banks, which establish, by agreement, conventional exchanges fixed for a considerable period, notably in the case of Australia, New Zealand and South Africa. The Scottish and Irish banks supply similar examples of a monopoly in exchange.

The following table taken from the money article of a London daily paper indicates the exchanges which are of most interest to England:—

In the case of Paris and Berlin it will be noticed that the local rate of discount is also given, as the value of money in these centres, in relation to the value of money in London, is the most important factor in a movement of the exchange. Vienna has become important owing to the improvement in the financial position of Austria, and still greater improvement is shown in the case of Italy, whose currency stands in the above list better even than that of France. Spain, which should stand at about the same rate, still has a depreciated paper currency. Lisbon stands also at a discount, as the milreis should be worth 53 pence.

In Russia the exchange showing 94.10 roubles to £10 is carefully

and cleverly controlled in spite of the bad internal position. The India exchanges move slightly, as the currency is firmly established at the rate of 15 rupees to the £1. Hong-Kong quotes for the old Mexican dollar and a British trade dollar; Shanghai for the tael containing on an average 517 grains of fine silver. The Straits Settlements have fixed their money on a gold basis at 2s. 4d. per dollar, on the lines of the arrangement made in India. In Japan there is a gold standard, and par of exchange is 2s. 0d. for the yen. Brazil, Chile and Argentina have a depreciated paper currency, and the last quotation of 48d. is for the gold dollar equal to five francs, but there is a premium on gold in the River Plate of 127.27% and for the present a gold standard is re-established on this basis. The letters T.T. with the eastern exchanges signify telegraphic transfer or the rate for payments made by cable. The very important New York rates are always given in another part of the daily paper with other details of American commercial interest.

These rates are all quotations for payments in England, and all over the world the exchange on London is the exchange of the greatest importance. This unique position was gained originally, probably, through the geographical position of the United Kingdom, and has been maintained owing to several reasons which secure to London a peculiar position by comparison with any other capital. Britain’s colossal trade ensures a supply of and a demand for English remittances. Even when goods or produce are dealt in between foreign countries a credit is opened in London, so that the shipper of the produce can offer in the local market a bill of exchange which is readily saleable. With the highly developed banking system a large amount of deposits is collected in London, and the result is that bills of any usance up to six months can be immediately discounted, and the proceeds, if required, can be handed over in gold. There are in London a great number of wealthy banks and banking houses whose reputation and solidity allow any one of them to accept bills for amounts varying from one to ten millions sterling, whereby large commissions are earned.

These four advantages, namely, a free gold market, a huge trade, an enormous accumulation of wealth, and a discount market such as exists nowhere else, have made London an unrivalled financial centre, and consequently bills on London are an international money and the best medium of exchange.

—A B C of the Foreign Exchanges, by George Clare; Foreign Exchanges, by Goschen; Arbitrage, by Deutsch; Arbitrages et Parités, by Ottomar Haupt; Swoboda, Arbitrage (12th edition), by Max Fuerst.

 EXCHEQUER. The word “exchequer” is the English form of the Fr. échiquier, low Lat. scaccarium, and its primary meaning is a chess-board (see ). As the name of a government department dealing with accounts it is derived from the exchequer or the “abacus” by means of which such accounts were kept, such a contrivance being almost universally in use before the introduction of the Arabic notation. In England the department or court of accounts was named originally “the tallies” from the notched sticks or tallies which constituted the primitive means of account-keeping (which were only abolished in 1826), and was only subsequently, probably in the reign of Henry I., named the exchequer from the use of the abacus. Both the name and the general features of the institution may reasonably be attributed to Norman influence, since we find both in Normandy and in the Norman kingdom of Sicily, as well as in Scotland and Ireland; the two latter cases being directly due to English example. As a court of law the exchequer owed its existence in England, as elsewhere, to the necessity of deciding legal questions arising from matters of account, and its secondary activities soon overshadowed its original functions.

We cannot say whether the exchequer, as known in England, is older than the beginning of the 12th century. The treasury, which may be regarded as one of its constituents, dates from before the conquest, and the officers of the exchequer who were drawn from the treasury staff can be traced back to Domesday. But our earliest information about the exchequer itself, apart from that afforded by the pipe rolls (see ), rests on a