re
said to be 1,500 idle ships in Hamburg alone. Few goods could be
exported. Gold was refused for export, of course. A serious liquidation
in foreign securities had been going on long before the war. Some
foreign securities must have still remained. However that may be, a
claim to funds in Germany (i.e., a bill drawn on Germany) was not
redeemable in gold, and it fell in price. In normal times a bill could
not fall below the shipping point in gold, (par with us for 4 marks is
95-1/4 cents in gold;) but, since gold could not be sent, exchange on
Germany could fall to any figure, set only by a declining demand.
Already bills on Germany have been quoted in New York at 82, showing a
depreciation of German money in the international field of about 13 per
cent. Likewise, as early as the first week of September, the Reichsbank
notes were reported at a discount of 20 per cent., and as practically
non-negotiable in a neighboring country like Holland.

The inevitable consequence of a depreciated currency must be a rise of
prices, usually greater than the actual percentage of depreciation. To
meet this situation there came a device possible in no other commercial
country. The Government fixed prices at which goods could be sold. This
mediaeval device could be enforced only in a land where such State
interference had been habitual, and, of course, could give to the notes
the fictitious purchasing power only inside the country. After the
Christian Science fashion, one had only to believe the notes were of
value to make them so; but in the cold world outside German jurisdiction
their value would be gauged by the chances of getting gold for them.
Here, then, we find Germany in all the mazes of our ancient
"greenbackism," but still in possession of a large stock of gold. As
soon as the war ends she may be able to return to gold payments at an
early date--very much as did France after the ordeal of the
Franco-Prussian war of 1870-1871.

In the present war conditions, however, largely cut off from other
countries, (except some small trade with Switzerland, Holland, Denmark,
and the like,) all ordinary relations which would influence German
credit and industry must be counted out. There is no comparison of her
prices and money with those of other countries in a free market, or with
even a limited transportation of exports and imports. All commercial
measurements are suspended for the time. Trade and credit are holding
their breath. How