the exports to China in particular there was a marked improvement.” [2] There had been temporary Acts to the same effect in 1898 and 1900. [3] Notes of Rs. 100 were universalised in 1911 by Notification under this Act. [4] The Hon. Mr. Dadabhoy, speaking in the Legislative Council in 1910, argued that “the harmful effects of a further fall in silver (_i.e._ in its bullion value) can be neutralised by Government by creating a further contraction in the volume of the currency, and thus producing a greater scarcity of the rupee, by maintaining the Gold Standard Reserve at a higher figure, and, further, by more frequent withdrawal of Council Bills from the market.” A contraction of the currency would not, of course, have the effect supposed, but the Government could not, in fact, bring about a contraction in the manner described. [5] This question of the power of Government over the volume of circulation is discussed in much greater detail in § 8 of Chapter V. [6] For example, in November 1912, “no gold was handed across the counter at the Bank of France except on the most urgent demand, and then the highest sum paid in gold was 300 francs per head. The other banks followed this example, and the most generous released 200 francs in gold. All special wishes for payment in money were charged 1 per cent premium. At the same time, deposits in gold were credited with 1 per cent premium” (see _Bankers’ Magazine_, December 1912, p. 794). At the beginning of the month cashiers were charging a premium or commission of 6 f. per 1000 f. for payments in gold instead of silver (see _Economist_, November 9, 1912, p. 961). [7] Although the Bank of France only holds an important quantity of foreign bills (generally sterling), on exceptional occasions, _e.g._ at the beginning and end of 1907 and at the end of 1909, foreign paper enters very largely, through the agency of the great Crédit Banks, into the transactions of the French Money Market. These institutions take foreign bills into their own portfolios, and obtain the necessary funds by rediscounting inland bills at the Bank of France. Thus the French mechanism is much more closely analogous to the British than appears outwardly, and the influence of the Bank of France, like that of the Bank of England, is mainly indirect. The possibility of this is no doubt due to the fact that France, like Great Britain, is a creditor nation in the international short–loan market. [8] For example, in November 1912 there was a premium of nearly ¾ per cent on gold for export. [9] This premium was made possible by the Austro–Hungarian Bank’s exercising its right to refuse to exchange its bank notes for gold freely. [10] In the abnormal conditions of recent times (1912–13), however, the Bank has not found it possible to maintain this part of its reserves at a high level.