The monetary system of the German Empire has been completely reorganized in the last few years, the laws previously passed for this purpose having gone into effect January 1, 1876. The changes made were, first, the adoption of the exclusive gold standard, with the gold mark of the value of 23 cents (in United States money) as the unit of values. Previous to this the unit was of silver, though both gold and silver were legal tender, the laws on these points being substantially the same as in the United States prior to 1873.

The main points in the re-organization of the banking system of the empire, and the regulation of the issues of paper money, the laws for which went into effect January 1, 1876, were as follows:

The imperial bank law decreed the formation of the "Empire Bank" at Berlin, with branches in all other important places in the empire. Besides all the ordinary business of a great commercial bank, the Empire Bank exercises, according to the imperial bank law, the function of "regulating the circulation of money in the whole of the German Empire." The Bank of Prussia

was absorbed in the Empire Bank, and all the remaining thirty-two provincial banks were embraced in the regulations of the imperial bank law. The total of thirtythree banks (including the Empire Bank) are authorized to issue an aggregate of 385,000,000 marks (equal to $91,630,000) of what is called "uncovered circulation." Of this 385,000,000 marks of circulation, 250,000,000 (equal to $59,500,000) is apportioned to the Empire Bank, which may issue such portion of them as its business requires. The remaining 135,000,000 marks is apportioned to the thirty-two provincial banks according to their capital and business. The term "uncovered circulation," as currently used with reference to the above aggregate of circulation for the German banks, is liable to be misunderstood. The Empire Bank and the provincial banks are required to hold a reserve of 33 per cent against all the circulation they issue. This 33 per cent must be, according to the text of the imperial bank law, either "in German currency, in legal tender notes of the empire, in gold bars, or foreign coins valued at 1,392 marks for a pound of gold." This "uncovered circulation" is, therefore, unlike the £14,750,000 of "permanent circulation" which the Bank of England may issue without any legal reserve. But the 385,000,000 marks is not the final limit of the volume of paper money in Germany. It is provided in the imperial bank law that "banks whose note circulation exceeds their 33 per cent reserve and the respective amounts assigned to them (as their portion of the 385,000,000 marks) shall pay yearly to the Exchequer on the excess a tax of 5 per cent, dating from the 1st of January, 1876. It will be seen, therefore, that the provincial banks have the privilege of issuing in excess of

their prescribed amount, and in excess of their reserves, by the payment of 5 per cent tax on the excess. The Empire Bank and its branches, and the provincial banks and their branches, are required to accept at par all German bank notes, but the notes so accepted "can only be used either in presentation for redemption by the bank that issued them, or as payments in the town where the bank which has issued them has its seat." In addition to the bank notes, as above authorized, the state issues 120,000,000 marks ($28,500,000) of legal tender notes of the empire.

Amount of bank notes and government notes circulating in Germany at various periods from 1850 to 1876 expressed in their equivalents in American gold.

Notes of Bank Imperial Bank All other Bank Total Circulaof Prussia. of Germany. and Govt. notes

tion.

Amount of government notes and notes of the National Bank of Austria in circulation each year from 1852 to 1875, stated in florins, and their total approximate nominal equivalent in United States coin:

Paper money in Russia is furnished almost exclusively by the government, and consists of treasury notes issued to the Bank of the Empire, for the debt of the government to that institution. The expenditures of the government have constantly exceeded the revenue since 1832. The aggregate debt thus accumulated amounted in 1869 to 1,375,385,000 roubles (a rouble is equal to 734 cents in United States money), and in 1873 to 2,277,081,364 roubles.

Specie payments have been suspended in Russia for nearly seventy years. There is no gold in circulation, and very little silver or other coin.

The following figures, compiled from an article in the Bankers' Magazine, will show the progress of paper money circulation in Russia:

RUSSIAN PAPER MONEY AND COIN IN CIRCULATION.

There is much confusion and error in the statements in cyclopedias and text-books in regard to the debt of Russia, and the proportion of it used as circulating money. The following will, however, explain some of the discrepancies in the statements as published in the various books.

The total debt of Russia on January 1, 1871, amounted in United States money to $1,241,750,000. This included about $575,000,000 (750,000,000 roubles) of paper money, or bills of credit issued by the government on the guarantee of all the banks and other credit. establishments of the empire. These are called notes of the Bank of Russia, but are issued by the Imperial Treasury.

January 1, 1873, the total debt amounted to $1,684,980,000 (2,277,081,564 roubles). In this amount is