Page:EB1922 - Volume 31.djvu/66

46 and 1920 was in the form of the melted silver currencies of France, Belgium, Germany and Austria, which were withdrawn from circulation and melted into bars. So much of this silver came into that market during this period that, notwithstanding the fact that the U.S. Treasury made an agreement with the American producers to purchase an amount of silver sufficient to replace what they had sold to the Indian Government at the fixed rate of a dollar an ounce, it was obtainable in large quanti- ties at prices considerably below what it was costing to produce it in many of the most important mines. And yet the French, Belgian, German and Austrian Governments were making sub- stantial profits in terms of their own depreciated currencies.

South African Exchange. Up to the time of the outbreak of war, there was almost a stereotyped London rate of exchange on S. Africa, never varying beyond the cost of sending gold either way usually, buying o- 5 % discount, selling o 5 % premium. Ow- ing to the difficulty in getting the natives to take and circulate notes, gold was the S. African currency in common use. In normal times there is a considerable leakage of gold from S. Africa. This rose to considerable proportions after the war had com- menced owing to the heavy premium on gold in other countries. Even after a law had been passed prohibiting the export of gold, a considerable amount of smuggling took place and continually reduced the amount of sovereigns held by the S. African banks. In order to replenish their stocks, the banks had to import sovereigns from England, resulting in the strange spectacle of the

largest gold-producing country of the world importing gold. This was due to the fact that all the fresh gold produced by the mines was requisitioned by the British Government.

Owing to the shortage of sovereigns, and the shipping of gold being a considerable expense to the banks, exchange facilities to exporters from England were somewhat restricted, and in May 1920 a premium of 8% was charged for remittances to S. Africa. The scheme by which a Federal Reserve bank for S. Africa was authorized to issue inconvertible notes to take the place of the gold currency, caused the exchange to drop to par in Aug. 1920, and the swing of the pendulum, encouraged by a considerable increase in the import of goods, created a shortage of funds in London and sent the exchange in the other direction until 6 % was charged for remittances on London in S. Africa in Nov.

1920. Hence the strange phenomenon of the currency of the greatest gold-producer in the world being at a discount as compared with the British Treasury note.

Rates of Exchange. Table F gives the chief rates of exchange ruling in London on three typical days: the end of- July 1914; the day on which the Armistice was declared (Nov. n 1918); and the last working day of the year 1920. There are also given the pre-war parity rates; the highest and lowest rates touched during the war, and also the highest and lowest rates touched between Armistice day and Dec. 31 1920; and that of Aug. 10

1921. The Austrian and German rates of exchange current during the war are those obtained from neutral countries.

TABLE F. Comparative Rates on London.

Place

Method of Quoting

Pre-War Parity

Rate of Exchange July 30 1914

Highest Rate during War

Lowest Rate during War

Highest Rate between Armistice and 12-31-20

Lowest Rate between Armistice and 12-31-20

Rate of

Exchange Nov. ii 1918

Rate of Exchange Dec 31 1920

Rate of Exchange Aug. 10 1921

New York

Dollars to.

$4.8744

4 . 90500 (cable)

6 50

4-49

4 -76S

3 2lJ

4.76! 4-76}

3-53i 3-55

3.64 3.67

Montreal

Dollars to.

$4.8744

4.95 (cable)

5 "

4-49

4-861

3^65

4.86 4.86J

4.09 4.12

4.05 4.08

Paris

Francs to.

Frs.25. 207

24-75 25.15

29.02

24.80

68.80

25.80

25.80 25.86

59-50 59.90

46.65 46.87

Brussels.

Francs to.

Frs.25. 207

25.00 25.25

38.50

25.323

63-65

25. gs

56.70 57-00

48.10 48.30

Italy.

Lire to. .

Lire 25.207

25.60 27.oo(29th)

45.6s

25.00

106.00

30.25

30.25 30.37}

IOI IO2

83 84

Switzerland

Francs to.

Frs.25. 207

25.124 25.25

26.50

18.50

25.20

18.95

23.08 24.05

23.14 23.18

21.67 21.75

Athens.

Drachmas to

Drs.25. 207

25.12} 2S-i8i

49-50

22.50

48 48*

66 67

Russia.

Rubles to 10

Rbls.g4.6o

102 103 nom.

t43o.oo

95.00

Helsingfors

I-mks. to

Fmks. 25.207

25.3725.42(27111)

44.60

25.802

180.00

41 75

11$ 118

35 245

Madrid.

Pesetas to.

PtS.25.2O7

25.92 26.o2(2gth)

26.90

IS 95

28.00

18.60

24.00 24.15

26.43 26.53

28.15 28.31

Lisbon.

Pence to escudos

53! per esc.

45jd 461d(29th)

42jd.

2 7 ;d.

36d.

Sid.

3old. 3i|d.

6d. 7d.

6}d. 7d.

Amsterdam

Florins to.

Fls.i2.o867

12.15 12. i6(2gth)

12.45

9.01

11.88

8.65

11.45 11.48

11.25 11.27

11.77 11.82

Berlin.

Marks to.

Mks.20.4i8

20.55 20.70(291)1)

32

20.60

365.00

67.50

257 259

293 297

Vienna.

Kronen to.

Krs.24.o2

24. 40 24. 70(29 th)

53

24.80

1600

160

1500 I55O

3150 3350

Prague.

Kronen to.

Krs.24.oa

.

450

80

305 310

282 200

Warsaw.

Marks to.

Mks.2o.4i8

.

.

2300

67

2200 23OO

7200 74OO

Bucharest

Lei to. .

Lei 25. 207

325

50

_

282 285

280 285

Belgrade

Dinar to.

D. 25.207

.

145

58

125 130

145 155

Chris tiania

Kronor to.

Krs.i8.i3t

18.26 l8.36(2gth)

19-75

II. OO

26.78

16.75

17-5.5 17-58

22.95 23.15

28.50 28.70

Stockholm

Kronor to.

Krs.i8.i3t

18.26 18.36(29111)

19.75

9.90

18.51

17.10 17.20

17.66 17.72

17.45 17-55

Copenhagen

Kronor to.

Krs.i8.i3t

18.2818.38(29^)

19-75

11.90

25.91

17-48

1 7 . 80 1 7 . 90

23.05 23.20

23-30 23.50

Alexandria

Piastres to.

97}

97J 97l (29th)

981

96

97i

g? 1

97i g?t

97l 97\

97B

Bombay Yokohama

Sterl. to rupee Sterl. to yen.

l6d. 2 4 Ad.

is.3(d. is.4d. 2s.oid. 2s.ojd-

2S.4(1.

IS.3W.

2S.lAd.

2S.g)d.

3s.o|d.

IS. 4 d. 2S.ld.

is.6d. is.6Ad. 2s.3Jd. 2s.3jd.

is.SJd- is.sJd. 29.8d. 2S.8Jd.

is-3|d. is.3fid. 2s.7id. 2s.7fd.

Shanghai Singapore

Sterl. to tael. Sterl. to dollars

38d.

2s.3Jd. 25. 4 id. 2s.3Hd. 2s.4Ad.

5s.6d.

2S.lid. 25-3d.

gs.6d.

2S. 4 !d.

3S.iold. 2S.3jd.

Ss.od. 5s. id. 2s.3fjd. 2s.4Ad.

43. id. 4S.2jd. 2s.3ftd. 2s.33id.

3S.6Jd. 3S.7Jd.

Rio de Janeiro

(god.)

Pence to milreis

2 7 d.

isHd. (2gth)

isid.

10 iV

ISA

g!,

I3ri

gH(3oth)

8

Buenoj Aires

Pence to dollar.

47id.

4 8i(Aug. 4)

55

4i

73J

sort ' siH

SI SiJ

44i 44i

Valparaiso (god.)

Pence to gold

peso

i8d.

9l(29th)

17!

7

isH

8!|

12}

9ft

Montevideo.

Pence to dollar

5.d.

66

73

S8 59)

49* So!

43J 44

Shanghai exchange being on a silver basis there was at no time a fixed parity between its currency and that of London. fTo Jan. 7 1918-

TABLE G. Value of pound sterling, Dec. 31 1920.

Compared

Purchasing

Compared

Purchasing

Dec. 31 1920 Middle rate.

with pre-war par value, sterling

power of i as com- pared with

Dec. 31 1920 Middle rate.

with pre-war par value sterling

power of i as compared with pre-

premium.

pre-war value.

discount of.

war value.

France ....

59-70

I36J %

2 7 4

New York

3'54i

27i %

o 14 6

Belgium.

56-85

125* %

2 5 i

Montreal

4-ioj

I5l %

o 16 10

Italy ....

loij

3025 %

406

Holland.

11-26

6| %

o 18 8

Norway

23-05

27 %

i 5 5

Sweden ....

17-60

-,i o/

2 2 /o

o 19 6

Denmark

23-I2J

271 %

i 5 6

Switzerland.

23 16

8 %

o 18 5

Finland .... Germany

116-50 258-00

362 % 1,163* %

4 12 5

12 12 8

Argentina Japan ....

snW.

2/8J

61 %

23* %

o 18 8 o 15 4

Greece ....

48-12*

91 %

i 18 2

India ....

l/Stt

9l %

o 18 2

Austria ....

1,525-00

6,249 %

63 99

Shanghai

4/i rV

43i %

o ii 3

Rumania

283-50

I.024J %

ii 411

Portugal

6id.

720 %

8 4 o

Spain ....

26-48

5 %

i i o

Brazil ....

9tfd.

63 %

i 12 8

Warsaw

2,250-00

10,920 %

110 4 o

Prague ....

307$

1,180 %

12 16 o