GIPE-PUNE-OIIOI2 - DSpace@GIPE

38 THE RE-MAKING OFTHEREICHSBANK
Down to 1913 the •• one-third" principle in regard
to cash cover was very liberally followed. The lowest
figure, 64,1 p.c., in 1907 was almost double the legally
required amount. And as regards the gold element in
the cash covet, although there was no legal compulsion.
the Re.ichsbank made it a point to observe extremely
¢autious practices. Even the lowest, namely, that of
1907, which came' down to 42-9 p.c. gold cover for all
the notes in circulation was much higher than the statutory
DTittelsdec1~ung for the entire cash cover. The gold covel'
alone, even without any other cash, would have
been more than enough to meet the requirements of
the law. Indeed much above the 40 p.c. gold cover pro.
vided for by the Act of 1924· was, factually in force
throughout the period from 1876 to 1913.
Two features of the pre-war German curren~y may
here be specially noted. First, gold might be accepted
by the Reichsbank in unlimited quantities in order to be
coined into money. In the second place, in exchange for
money in any form. possessors might 'obtain gold bullion
.of equal values. This indeed is but a normal item in
genuine gold-standard states or epochs.
The ReidJsbank Reconstructed (1924-29)
The account furnished above belongs now to history.
A fundamental reorganization,--a really thorough over-
7 Die Reichsbanlc 1901-1925 (Berlin); Neufeld: Das Ban1(gesetz 'und
dOl Geletz iiber die Pril1atno!enbonlce~ (Berlin. 1925); Koch and Schacht:
Miinz-und Bon1(geset;:gebung (Berlin. 1926); Schacht; Die Stobilisierung
der Marlc (Stuttgart. 1927)_
The constitution discussed here has reference to th~ provisions under
the 'Dawes Plan (1924-29), To.day the situation is virtually the same so far