[The Economic Consequences of the Peace by John Maynard Keynes]@TWC D-Link book
The Economic Consequences of the Peace

CHAPTER VI
18/31

In spite of a very great rise in German prices, they probably do not yet average much more than five times their former level, so far as staple commodities are concerned; and it is impossible that they should rise further except with a simultaneous and not less violent adjustment of the level of money wages.

The existing maladjustment hinders in two ways (apart from other obstacles) that revival of the import trade which is the essential preliminary of the economic reconstruction of the country.

In the first place, imported commodities are beyond the purchasing power of the great mass of the population,[148] and the flood of imports which might have been expected to succeed the raising of the blockade was not in fact commercially possible.[149] In the second place, it is a hazardous enterprise for a merchant or a manufacturer to purchase with a foreign credit material for which, when he has imported it or manufactured it, he will receive mark currency of a quite uncertain and possibly unrealizable value.

This latter obstacle to the revival of trade is one which easily escapes notice and deserves a little attention.

It is impossible at the present time to say what the mark will be worth in terms of foreign currency three or six months or a year hence, and the exchange market can quote no reliable figure.


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