[pg 184] That the arrest in the fall of the rupee should have lifted the burden from Indian finances was just as was expected to follow from the closure of the Mints. Notwithstanding important reductions in taxation and large expenditure of social utility, the annual budgets since the Mint closure have shown few deficits (_see_ p. 185). Now there is a tendency among some writers to interpret these facts as unmistakable proofs of the soundness of the currency system. It is argued that if the trade of the country has not received a setback,³⁰¹ and if the finances of the country have improved,³⁰² then the implication is that the currency of which such results can be predicated must be good. It is not necessary to warn students of currency that such easy views on the soundness of the currency system, however plausible, are devoid of the logic necessary to carry conviction. Trade no doubt is dependent on good money, but the growth of trade is not a conclusive proof that the money is good. It should be noted that during the periods of debased coinages so common at one time the social misery and nuisance arising there from were intolerable, yet during the same periods it was possible for countries to make great advance in trade. Speaking of seventeenth-century England, when that country was afflicted with debased and constantly changing coinage and when there was, besides, a long period of civil war and confusion, Lord Liverpool, who was above all statesmen of his day most alive to the evils of a bad currency, remarks:— ³⁰¹ Keynes, op. cit., p. 3. ³⁰² Barbour, D., _The Standard of Value_, p. 224. “It is certain, however, that during the whole of this period, when our coins were in so great a state of confusion, the commerce of the kingdom was progressively improving, and the balance of trade almost always in favour of this country.”³⁰³ ³⁰³ _A Treatise on the Coins of the Realm_ (reprint of 1880), p. 135. That commerce can increase even when currency is bad is easily supported from the experience of India herself. In no period did Indian trade make such strides as it did [pg 185] _TABLE XXVII_ _Finances of the Government_