ISBN: 1246173557 / ISBN-13: 9781246173550
Elihu Root Collection of United States Documents; Ser. A.-F.]
by Elihu Root
This historic book may have numerous typos and missing text. Purchasers can download a free scanned copy of the original book (without typos) from ... Show synopsis 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. 1903 Excerpt: ...the withdrawal of gold from London, a measure which might weaken the great central reserve of the Empire. This feature seems to be a distinct objection to the scheme. The public will regard with distrust arrangements for the establishment of a gold standard in India which carefully involve the location of the gold reserve in London and its use there by trade. A gold reserve intended to support the introduction and maintenance of a gold standard in any country ought to be kept in the country if it is to produce its full effect in the way of establishing the confidence which is almost indispensable to the success of the measure. If the Indian gold reserve is located in London and the public believe that it may at any time vanish in supplying the requirements of trade or of the secretary of state, confidence will hardly be established; and in any case it seems certain that a reserve of any named amount will produce a greater effect if it is located in India than if it is 6,000 miles away. 4. The method and principle of operation of the scheme are very much the same as those on which our own proposals are based. Given a circulation composed of a certain number of rupees, and given a certain condition of trade in point of volume and activity, the rate of exchange will tend to some definite point. If the number of rupees is diminished or the activity of trade increased, the rate of exchange will rise, and vice versa. It follows that if rupees are bought and locked up, the rate of exchange will be raised, and if the government offers to buy them up at lojd. and continues to so buy them upas long as they are offered (as they will be as long as the exchange value is less than lojd.), the value will ultimately be raised to 15Jd. But it is merely an assumption that th...