The exchange is very low, five crowns to a penny, three hundred to a dollar. For a thousand crowns a week you can live--you can live in one room and keep body and soul together. For two thousand crowns a week you can live at a second-class hotel with board and lodging. An ordinary dinner with a glass of beer costs a hundred crowns. You can also get a seat at the back of the stalls in a theatre for that amount. There is a luxury-tax of ten per cent on all you buy at cafes and restaurants, on perfumery, and like objects. This, no doubt, brings in a large amount to the national exchequer if it is efficiently collected. The wages and salaries of all trades and professions are in a continual hurdle-race, vaulting cost of living and the rate of exchange. There are thousands of _nouveaux riches_, and there are thousands of ex-rich and gentry in decay. One feels that Hungary, however, is a rich country even as she stands to-day, and that the people have sterling qualities which make for the recuperation of the new State. There is still a love of work in the country, and that is comparatively a rare virtue in modern Europe. The working class, as in Germany, feels that it lost the war and cannot expect extra fine conditions. The Hungarian working man outworks and therefore undersells or can undersell the English working man. The nation whose working men are ready to do most work is the most fortunate in 1921. If Hungary can avoid indemnities and export taxes she is likely to do well. The Government will no doubt undergo many changes, and most people believe that the King is bound to come back. By popular vote he probably would--just as Constantine did in the Greek elections. But external opposition is too great. If Czechs and Serbs quarrelled it would be different. International animosity and the general ill-will militate most against the peaceful development of the new Hungary. Budapest no doubt will always win friends for the country of which it is the capital. Capitals can be of enormous service to states in the matter of silent propaganda. A handsome comfortable city of impressive buildings will always predispose foreigners in favour of the country itself. On the other hand, an inadequate capital will be a hindrance to a state. In this respect, Belgrade, as it is to-day, is a handicap to Jugo-Slavia. But Budapest will help Hungary enormously. What a glamour there is upon Budapest in the evening, with myriads of lights on each side of the gliding Danube. Formerly one arrived under the grand bridges in a house-boat at night and came alongside the stone quays, and without passports or customs walked up into one of the gayest and brightest cities of Europe. But now the Danube, mother of mighty countries, is enchanted and enthralled. When will she be disenchanted again? LETTERS OF TRAVEL VIII. FROM VIENNA