GIPE-PUNE-OIIOI2 - DSpace@GIPE

44 THE RE-MAKING OF THE REICHSBANK
"metallistic" theory has persisted, although to some
extent shaken and modified, and finally succeeded in
maintaining its ground in actual legislation as embodied
in the Bank Act of 1924. Instead, therefore, of emanci.
pating the currency from gold and establishing it on the
note as credit-instrument the new Reichsbank has
accepted the principle of the gold-standard with
vengeance.
In the first place, the traditional German custom of
Drittelsdeck,ung or one-third cover for notes has ~en
abolished. And in the Sl!cond place, Gold-deck,ung
(Gold-cover), which was but optional or discretionary in
the old Riechsbank, has been made compulsory in 1924
and the proportion has been fixed at a high level. ,
The new legislatiop compels the notes to be covered
in their entirety in the followin,g manner:-
I. Gold-deck,ung (Gold-cover) 40 p.c.
(a) actual gold (30 p.c.):
1. gold bullion, 2. German gold coins,
3. foreign gold coins.
All· this gold may be held either in the
Reichsbank ,itself or in a foreign central
bank on current account. Fine gold
is defined in such a manner that one
pound makes 1392 Reichsmarks.
(b) Devisen (10 p.c.) :
1. bank 'notes, 2. bills of ~xchange maturing
in 14 days at the latest, 3. cheques,
4. daily bills payable in foreign money
in a foreign finance-centre by a bank
known to l:e solvent.