──────────────────────────────────────────────────────── ───────────────── September Nominal 25 4 0 19 2 0 — ──────────────────────────────────────────────────────── ───────────────── October Nominal 27 6 0 18 14 0 — ──────────────────────────────────────────────────────── ───────────────── November Nominal 28 10 0 18 8 0 — ──────────────────────────────────────────────────────── ───────────────── December Nominal 27 12 0 18 6 0 — ───────────────────────────────────────────────────────────────────────────────────────────────── The tables need no comment. The rupee is not only far away from 2s. (gold), but is not even 1s. 4d. (sterling). Do not the facts furnish an incontrovertible proof of the futility of the exchange standard? How can a system which fails to maintain its value in terms of gold, which it is supposed to do, be regarded as a sound system of currency? There must be somewhere some weakness in the mechanism of a system which is liable to such occasional breakdowns. The rupee fell or rather was below par in 1893, and did not reach its parity to any real degree of firmness until 1900. After an interval of seven years the rupee again falls below par in 1907. The year 1914 witnesses another fall of the rupee. A meteoric rise since 1917, and again a fall after 1920. This curious phenomenon naturally raises the question: Why did the rupee fail to maintain its gold parity on these occasions? A proper reply to this question will reveal wherein lies the weakness of the exchange standard. [pg 198]