The Guardian (And Evening Star, with which is incorporated the west Coast Times.) SATURDAY, JANUARY 5th, 1921. GERMANY.

Hokitika Guardian, 5 January 1924, Page 2

The Guardian (And Evening Star, with which is incorporated the west Coast Times.) SATURDAY, JANUARY sth, 1921. GERMANY.

What the actual position of affairs is in Germany now, or what it may be, is difficult to say, but from an economic standpoint the outlook appears to bo hopeless, and the possibility of the country dividing up into various independent States does not increase the chances of Frame or any other country receiving reparation payments. The condition into which German finances have drilled, or liavo been plunged headlong by the reckless jioliey adopted L ; her rulers, provides a very striking object lesson of the dangers of monetary inflation. In the case of Germany ft has been fairly proved.that recourse to the punting press for the means io carry on bears , an analogy to the use of drugs, for tlw dose has to lie increased again and. again in order to have any effect, and'ultimately if point is reached when the. drug is no longer

efficacious. Germany lias in flitted the national currency to an extent never before attempted b.v any nation. The last return of the Keichsbank showed a note circulation of over 123 thousand billion marks, the increase in the week covered by tile statement having been neaily 70A billions. This return was made up to October Jo. and ii is probable that later figures will show a still moie stupendous expansion. lint with every increase the purchasing power of the paper mark is ieduced. There was a time when, relatively, the mark in Germany had a greater ptirehadug pov.er than the mark alu oad, hul apparently this diilerenco las disappeared, and taking the sterling value of i hi.' German currency, in the absence of any more trustworthy ciilcrinn. it is found that at a recent ate of exchange the purchasing power of this huge note circulation ol Germany was almost insignificant. I lie exchange rale was lately quoted at -it) billion marks to the i\ which meant that the 123 thousand billions of pa pci marks issued by the Reiclisbank bad a sterling value nt less than .Cl,ooo. •,'j.ts coi t a inly lcpicscnts the purclia.si:;.. power id the paper mark abroad, and it means that a positiuu is being rapidly reached when Germany will have little or no money, of value, with which to linunec her requirements. It means that the banks in Germany, even if they hold huge amounts of deposits, now find that such deposit* are albln-t. worthless, Localise they are in the form of paper marks. Owing, apparently, to political complications. Germany has not- succeeded in introducing a new currency, which ii was hoped would have a measuie ol .staljilii\ and, failing this, it would seem that the country will find it very difficult to avoid complete economic cellapse.