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SPRINGER BRIEFS IN LAW

Christoph Herrmann
Corinna Dornacher

International
and European
Monetary Law
An Introduction

123
SpringerBriefs in Law
More information about this series at http://www.springer.com/series/10164
Christoph Herrmann Corinna Dornacher
•

International and European

Monetary Law
An Introduction

123
Christoph Herrmann Corinna Dornacher
Faculty of Law Faculty of Law
University of Passau Ludwig Maximilian University of Munich
Passau Munich
Germany Germany

ISSN 2192-855X ISSN 2192-8568 (electronic)

SpringerBriefs in Law
ISBN 978-3-319-57641-1 ISBN 978-3-319-57642-8 (eBook)
DOI 10.1007/978-3-319-57642-8
Library of Congress Control Number: 2017938622

© The Author(s) 2017

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Preface

Monetary law has long been dealt with by a small group of specialists only. Some
legal scholars even claimed that there was no such thing as monetary law.
Obviously, this is not true. The opposite statement by Georg F. Knapp at the
beginning of the 20th century: “Money is a creature of law” comes closer to the
truth. Modern monetary systems cannot exist nor be imagined absent a legal
framework. This is particularly true when it comes to cross-border financial activity
or monetary integration within international organizations such as the European
Union. Yet, monetary law is no easily accessible field of law, nor is it treated in
course curricula at university very frequently, despite its obvious relevance in
recent times of crisis.
With the present introduction, we try offer a guide to studying monetary law,
international and European, and make the complicated interplay between eco-
nomics (and sometimes politics) on the one hand, and law on the other, more
comprehensible. It is based on our own research and teaching experience of the past
years. A somewhat longer version of the work is currently being used as the
backbone for an online course of the Virtuelle Hochschule Bayern (vhb), a virtual
university of the Free State of Bavaria, Germany (http://www.vhb.org/en/
homepage/). The vhb thankfully permitted the publication of this work to make
it more widely accessible.
We hope that expectations of our readers are met and appreciate feedback to
[email protected] and [email protected].

Passau, Germany Prof. Dr. Christoph Herrmann LL.M.

Munich, Germany Corinna Dornacher
March 2017

v
Contents

1 Interdisciplinary Introduction to Money and Currencies . . . . . . . . . 1

1.1 History of Money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1.1 What Is Money? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1.2 Historical Development of Money . . . . . . . . . . . . . . . . . 2
1.2 Monetary Policy Basics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.2.1 Two-Tier Mixed Monetary System . . . . . . . . . . . . . . . . 5
1.2.2 Monetary Aggregates. . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.2.3 Monetary Policy and Policy Instruments . . . . . . . . . . . . 6
1.2.4 Currencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.2.5 Monetary Policy and Fiscal Policy . . . . . . . . . . . . . . . . 7
1.3 Money and the Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2 Monetary Sovereignty and History of International
Monetary Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.1 Monetary Sovereignty under Public International Law . . . . . . . . 11
2.1.1 The General Principle of Sovereignty . . . . . . . . . . . . . . 11
2.1.2 Monetary Sovereignty . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.2 History of International Monetary Law . . . . . . . . . . . . . . . . . . . . 15
2.2.1 Gold Standard . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.2.2 The Creation of the Bank for International Settlements
(BIS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
2.2.3 The Establishment of the IMF . . . . . . . . . . . . . . . . . . . . 17
2.2.4 The IMF’s Development . . . . . . . . . . . . . . . . . . . . . . . . 18
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
3 Fundamental Legal Problems of International Monetary
Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
3.1 Lack of a Universal Currency . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
3.2 Convertibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

vii
viii Contents

3.3 Exchange-Rate Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

3.4 Free Movement of Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
3.5 International Liquidity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
3.6 The Trilemma of Monetary Policy . . . . . . . . . . . . . . . . . . . . . . . 28
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
4 The International Monetary Constitution: The IMF Articles
of Agreement—Institutional Design and Decision-Making . . . . . . . . 31
4.1 Institutional Design . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
4.1.1 The IMF within the International Setting. . . . . . . . . . . . 31
4.1.2 The Legal Framework of the IMF . . . . . . . . . . . . . . . . . 32
4.1.3 Institutional Design . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
4.2 Decision-Making Procedures/Processes . . . . . . . . . . . . . . . . . . . . 37
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5 The International Monetary Constitution: The IMF Articles
of Agreement—Substantive Legal Obligations . . . . . . . . . . . . . . . . . 41
5.1 Convertibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
5.2 Exchange-Rate Regimes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
5.3 IMF Surveillance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
5.4 Technical Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6 IMF Lending (Financial Assistance). . . . . . . . . . . . . . . . . . . . . . . . . . 51
6.1 Financial Architecture and IMF Resources . . . . . . . . . . . . . . . . . 51
6.1.1 Financial Architecture . . . . . . . . . . . . . . . . . . . . . . . . . . 51
6.1.2 Financial Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
6.2 Types of IMF Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
6.2.1 Non-concessional Financing . . . . . . . . . . . . . . . . . . . . . 54
6.2.2 Concessional Financing . . . . . . . . . . . . . . . . . . . . . . . . . 55
6.3 Modalities of and Access to IMF Facilities . . . . . . . . . . . . . . . . 55
6.3.1 Access Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
6.3.2 Modalities of IMF Facilities . . . . . . . . . . . . . . . . . . . . . 56
6.3.3 Conditionality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
6.4 Crisis Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
6.5 The IMF and Currency Unions . . . . . . . . . . . . . . . . . . . . . . . . . . 61
6.5.1 IMF Membership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
6.5.2 The IMF and Currency Unions in Practice . . . . . . . . . . 61
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
7 History of European Monetary Law . . . . . . . . . . . . . . . . . . . . . . . . . 63
7.1 The Historical Development of the European Monetary
Constitution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
7.1.1 First Initiatives of Multilateral Monetary
Cooperation in Europe . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Contents ix

7.1.2 Monetary Implications of the European

Integration Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
7.1.3 The Evolution of the European Economic
and Monetary Union . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
8 The Legal Framework of EMU post Lisbon—Institutional
Setup . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
8.1 ESCB and ECB . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
8.1.1 Institutional Design . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
8.1.2 Eurosystem Objectives and Tasks . . . . . . . . . . . . . . . . . 76
8.1.3 ESCB Decision-Making. . . . . . . . . . . . . . . . . . . . . . . . . 78
8.1.4 Central Bank Independence . . . . . . . . . . . . . . . . . . . . . . 79
8.2 ECOFIN Council and Eurogroup . . . . . . . . . . . . . . . . . . . . . . . . 79
8.3 Commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
8.4 Economic and Financial Committee . . . . . . . . . . . . . . . . . . . . . . 80
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
9 The Substantive Legal Foundations of EMU post Lisbon . . . . .... 83
9.1 Basic Features of EMU . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 83
9.2 Membership and Territorial Scope of the Euro Area:
Ins and Outs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
9.2.1 Convergence Criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
9.2.2 Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
9.2.3 The Exception: “Outs” . . . . . . . . . . . . . . . . . . . . . . . . . 86
9.2.4 Relationship Between Ins and Outs . . . . . . . . . . . . . . . . 87
9.2.5 Termination of Membership . . . . . . . . . . . . . . . . . . . . . 87
9.3 The Euro as Legal Tender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
9.3.1 Legal Tender Status and Issuance of Banknotes
and Coins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
9.3.2 Regulations Introducing the Euro . . . . . . . . . . . . . . . . . 89
9.3.3 The Euro in Third Countries . . . . . . . . . . . . . . . . . . . . . 89
9.4 Free Movement of Capital and Payments . . . . . . . . . . . . . . . . . . 90
9.4.1 Reasons for the Liberalization . . . . . . . . . . . . . . . . . . . . 90
9.4.2 Content and Scope of the Freedom . . . . . . . . . . . . . . . . 90
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
10 The Monetary Policy of EMU . . . . . . . . . . . . . . . . . . . . . . . . . . .... 93
10.1 Legal Foundations and Limits. . . . . . . . . . . . . . . . . . . . . . . .... 93
10.1.1 What is Monetary Policy and How Does
it Work? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 93
10.1.2 The Eurosystem’s Monetary Policy Mandate . . . . . .... 95
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 98
x Contents

11 Economic Policy Coordination in EMU . . . . . . . . . . . . . . . . . . . .... 101

11.1 The Case for Economic Policy Coordination in EMU . . . . .... 102
11.1.1 Primary Law Foundations of Economic Policy
Coordination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
11.1.2 Secondary Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
11.1.3 Extra-Union Law Measures . . . . . . . . . . . . . . . . . . . . . . 109
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
12 The External Relations of EMU . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
12.1 The Acting Institutions/Entities . . . . . . . . . . . . . . . . . . . . . . . . . . 111
12.1.1 The Division of Competence . . . . . . . . . . . . . . . . . . . . . 112
12.1.2 The Doctrine of Parallelism . . . . . . . . . . . . . . . . . . . . . . 113
12.1.3 Judicial Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
12.2 Exchange-Rate Policy of EMU . . . . . . . . . . . . . . . . . . . . . . . . . . 113
12.2.1 Objective of Exchange-Rate Policy . . . . . . . . . . . . . . . . 114
12.2.2 Formal Exchange-Rate Arrangements
(Art. 219 (1) TFEU) . . . . . . . . . . . . . . . . . . . . . . . .... 114
12.2.3 Floating Exchange-Rates (Art. 219 (2) TFEU) . . . .... 115
12.2.4 Agreements Concerning Monetary or Foreign
Exchange Regime Matters (Art. 219 (3) TFEU) . . . . . . 116
12.2.5 Tasks of the ECB (Art. 127 (2) TFEU) . . . . . . . . . . . . . 116
12.3 International Relations of EMU . . . . . . . . . . . . . . . . . . . . . . . . . 117
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118
13 EMU and the Sovereign Debt Crisis—Legal Aspects
of Financial Assistance for Member States . . . . . . . . . . . . . . . . . . . . 119
13.1 Evolution of a Crisis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119
13.2 Measures of Member States . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121
13.2.1 Measures Based on Extra-Union Law . . . . . . . . . . . . . . 121
13.2.2 Measures Based on EU Law . . . . . . . . . . . . . . . . . . . . . 125
13.3 Legal Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128
14 EMU and the Sovereign Debt Crisis—Legal Aspects
of Monetary Policy Responses and the Banking Union . . . . . . . . . . 129
14.1 The Monetary Policy Reactions to the Crisis . . . . . . . . . . . . . . . 129
14.2 Non-standard Monetary Policy Measures . . . . . . . . . . . . . . . . . . 130
14.2.1 Enhanced Credit Support . . . . . . . . . . . . . . . . . . . . . . . . 130
14.2.2 Qualitative Easing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
14.2.3 Structural Open Market Operations . . . . . . . . . . . . . . . . 131
14.3 Legal Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134
14.4 Banking Union . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
Chapter 1
Interdisciplinary Introduction to Money
and Currencies

For a comprehensive understanding of the legal principles constituting European

and International Monetary Law it is necessary to focus first on the subject matter at
hand: Money. Despite the term’s universal and frequent usage, few outside the
world of economic academics have probably taken the time to ponder what money
actually is, how it evolved historically and how monetary systems and policy
function today.

1.1 History of Money

1.1.1 What Is Money?

This relatively simple question proves to be rather complicated to answer and has
been the subject of an ongoing academic debate in economic, social and legal
theory. The origins of the debate enjoy respectable antiquity and include the works
of Aristotle, as well as later the works of scholars such as Weber, Schumpeter,
Keynes and Friedman. Generally, three different approaches as to what money is
can be distinguished:
The most practical approach is probably taken by economists, briefly stating
“Money is what money does!”.1 The nature of money is thereby defined by the
functions attributed to it. Generally, three characteristic functions are recognised,
albeit it is controversial which is the predominant one: Medium of exchange, unit of
account and store of value. Therefore, all existing financial assets (cash, demand
deposits etc.) that fulfil these three functions are economically considered to be
money.
In social theory, on the other hand, the role of the general public is strongly
emphasised, assuming that any commodity which is used as a means of exchange
1
I.a. Spahn (2003, p. 1).

© The Author(s) 2017 1

C. Herrmann and C. Dornacher, International and European Monetary Law,
SpringerBriefs in Law, DOI 10.1007/978-3-319-57642-8_1
2 1 Interdisciplinary Introduction to Money and Currencies

constitutes money. This assumption links the nature of money to a recurring social
practice of giving/receiving commodities as payment/consideration.
Conversely, in legal theory, Knapp most famously stated that “money is a
creature of law”,2 meaning that only those commodities constitute money, which
are equipped with purchasing power by the State. Yet, there is no general legal
definition of money. The legal terminology used is inconsistent and the meaning of
the term money varies significantly in criminal, public and civil law.
With that in mind, it is reasonable to define the socio-economic phenomenon of
money somewhat pre-legally in order to gain an idea of what money is or could be.
Considering the monetary functions in modern economies—medium of exchange,
unit of account and store of value—such a definition could be: “A transferable unit
of account, which is universally accepted as consideration for goods or services”.3
Furthermore, the general recognition of commodities as means of payment largely
depends on the following characteristics: scarcity (actual or controlled), count-
ability, uniformity, durability, portability and broad acceptance.
Currency on the other hand is defined as the regulation (not necessarily by
sovereign power) of a monetary system based on a unit of account, which is used as
means of exchange within a certain community. The term currency is also com-
monly used to describe the unit used in an organised monetary system (cf. Art. 3 (4)
Treaty on European Union (TEU)).

1.1.2 Historical Development of Money

The history of money and monetary systems can be described and conceived as an
actual socio-economic and cultural phenomenon, tracing back as far as the origins
of mankind. The development began with the use of specific preferred barter goods
(cowry shells, cattle etc.) as common means of exchange and evolved through the
creation of metal and coin money, book money, banknotes and paper money into
nowadays widely-used electronic forms of money. It has been a constant process of
dematerialisation, incipient with real commodities transforming over time into
virtual units of account without any innate utility.
The initial development of money stems from the need of people to exchange
goods and services. Conversely, fully self-sufficient people in terms of goods and
services do not need money. But even in the early stages of mankind a division of
labour existed, creating a need for exchange with others. Initially the problem was
solved by direct barter—a burdensome practice of searching for suitable exchange
partners. These impracticalities are thought to be the reason behind the emergence
of common means of exchange. Though they differed regionally, the means of
exchange were usually coveted specific barter goods with an innate utility, e.g.

2
Knapp (1923, p. 1).
3
Herrmann (2010, p. 78).
1.1 History of Money 3

cowry shells, cattle etc. (means of exchange theory).4 This means of exchange
theory is not undisputed in academia. Other explanations of the origin of money
include religious and cultural causes for the choice of certain barter goods as means
of exchange, e.g. the sacral meaning of cattle or because of a combination of
aesthetics and human craving for recognition (so-called swank money). Ultimately,
there is no mono-causal explanation for the origin of money. It was a lengthy
process, influenced by social, religious and economic factors.
Barter goods were subsequently replaced by precious metals, which proved to be
the most popular means of exchange as they were scarce, countable, uniform,
durable and portable in bars. But although the physical characteristics of metal
predestined it as a means of exchange, it also caused problems. Before an exchange
could be executed, the metal had to be weighed and counted and its quality had to
be determined, which caused delays and disputes. In an attempt to solve this
problem, coins were invented—pre-weighed standardised portions of a specific
metal. Additionally, in order to certify the measurements, the coins were later on
minted. In the Western World the birth of the metal coin dates back to 600–800 BC
(possibly even earlier in China and India).5 This marks both the beginning of the
idea that money has its own character and functions abstract and distinct from the
commodity used for exchange, and the beginning of the State influence on money.
States quickly claimed the right of coinage as part of their sovereignty, hence taking
the first step towards a monetary system and the creation of currencies. Throughout
the span of the metal era, different metals were in use, mostly however silver and
gold which led to the era of Bimetallism. The coexistence of both metals lasted until
the end of the 19th century when gold became the single monetary standard. By this
time, gold coins were not actually circulating anymore: ever since the 13th century,
they had gradually been replaced by paper money and token coins, whose value
was not determined by their metal content anymore. Token coins were merely a
representation of silver and gold. Yet gold still played an important role as the value
of the money depended on its relation to the gold reserves of the currency.
The triumph of paper money ensued due to the difficulties in transportation of
larger amounts of metal and the occasionally insufficient availability of precious
metal, which complicated matters further. Ever since the commercial revolution of
the 13th century, merchants therefore began to issue drafts and bonds in writing,
which could be converted into certain amounts of real metal. The merchant’s metal
was stored by a changer, who would convert the bonds and drafts for them. As the
practice of cashless payment evolved, changers simultaneously assumed the role of
bankers. The stored metal was technically book money, an early form of demand
deposits. The changers additionally began to loan the metal of their deposits to
other clients, which created a significant problem inherent to every financial system
up until today: The collapse of a bank caused by its inability to issue cash, resulting

4
For an overview see Davies (2016, pp. 10 ss, 35 ss).
5
Davies (2016, pp. 57 ss).
4 1 Interdisciplinary Introduction to Money and Currencies

from a run—a sudden and simultaneous withdrawal of money by bank clients—

after a major fallout in its credit business.
The circulation of these papers increased and goldsmiths began to hand out
receipts or goldsmith notes to clients, denominating the stock of gold stored. These
notes were transferable by endorsement and also used and accepted as means of
payment. Around 1670, London goldsmiths standardized the notes, pre-
denominating smaller amounts of gold instead of the respective stock or the speci-
fic amount of gold used in a single transaction. Subsequently, goldsmith notes even
became transferable without endorsement. Meanwhile other banks and even States
started to issue such notes too. Legally, these notes were bonds payable to the bearer
and transferable without endorsement. Due to their widespread public acceptance as
direct form of payment, the notes (paper money) achieved monetary status for the
first time and were rarely returned to their issuer. Yet our modern version of paper
money only emerged and developed between the 18th and 20th century after the
issuance and authorisation of banknotes were brought under national governments’
control by securing a monopoly for public and some private central banks, granting
paper money the status of legal tender and ending the gold/silver backing as well as
the obligation to convert. Ultimately, this also marked the end of the metal era, not
however the end of the process of monetary development.6
The final stage of this process of dematerialisation was reached with the
beginning of the information age from 1950 onwards. The introduction of elec-
tronic payment transactions and electronic money (e-money) took dematerialisation
one step further and presented a purely virtual form of money without any innate
value. However, it is important to differentiate between electronic payment trans-
actions and e-money, because they differ significantly. The former is simply an
electronic and thus more effective version of the known and traditional book money
instruments. The latter is a demand deposit, which is saved on data mediums, issued
in exchange for (real) money and accepted by companies as means of payment (e.g.
prepaid cards). The legal construction is similar to bearer bonds, although e-money
naturally cannot be qualified as a certificate. Since e-money can only be used for a
single payment transaction, ceases to exist after conversion into cash or book
money and is completely dependent on national monetary systems and traditional
banking services, it cannot be considered as virtual money just yet. A different
assessment may be pertinent with regard to so-called “crypto-currencies”7 or virtual
currencies, a notable example being Bitcoins. Crypto-currencies rely on
peer-to-peer networks, are thus decentralized, globally distributed and pseudony-
mous due to the encryption transactions.8 In contrast to e-money, crypto or virtual
currencies’ funds are not expressed in traditional currency units (Euro, Dollar etc.)

6
For a detailed study of the development see Davies (2016, pp. 183 ss).
7
For further information on crypto-currencies see https://www.ecb.europa.eu/pub/pdf/other/
virtualcurrencyschemesen.pdf.
8
For information on the technological background and functioning of Bitcoins see: Simonite
(2011), The Economist (2015).
1.1 History of Money 5

but in the respective virtual accounting unit (e.g. Bitcoins).9 Within the respective
community, they fulfil monetary functions and some, Bitcoins in particular, are
convertible into traditional currencies and have a free floating (thus far very
volatile) exchange-rate. The ECB cautiously defined them as “a digital represen-
tation of value, not issued by a central bank, credit institution or e-money insti-
tution, which in some circumstances can be used as an alternative to money”.10 The
careful choice of words and rather vague formulation hint at the still highly disputed
monetary and legal status of crypto-currencies. The European Court of Justice
(ECJ) recently implied in a preliminary ruling that Bitcoins are indeed to be clas-
sified as a currency, albeit a virtual one.11 Other commentators,12 however, regard
the characterization as a virtual currency as a simplification of the technological and
economic options offered by crypto-currencies. The ECB even rejects the idea of
crypto-currencies being money or currencies in that sense altogether based on
economic and legal considerations.13 And the German Federal Financial
Supervisory Authority decided to treat them as a form of private money falling
under the general category of financial instruments, § 1 XI German Banking Act
(KWG) for regulatory purposes.14 This exemplifies that the issue of virtual money
is far from being resolved and the aforementioned judgement most likely only
marks the beginning rather than the end of the legal debate.

1.2 Monetary Policy Basics

1.2.1 Two-Tier Mixed Monetary System

With the exception of a few countries, which use a currency board system (foreign
currency backing for the domestic currency), the two-tier mixed monetary system is
universally employed. The two tiers of the system consist of central banks on the
one hand and commercial banks on the other. The system is mixed because money
is provided by central banks (monetary base or “high powered money”) and by
commercial banks (book or bank money). Both monetary forms are economically
considered as money. The issuance of cash is normally a monopoly of central
banks, which manage the supply of money. Commercial banks on the other hand
can generate money by allowing demand deposits on credit in central bank money

9
ECJ, judgement from October 22nd 2015, Skatteverket/Hedqvist, C-264/14, para. 12.
10
ECB (2015, p. 4).
11
ECJ, judgement from October 22nd 2015, Skatteverket/Hedqvist, C-264/14, para. 12 and 24.
12
See e.g. Maupin (2015), http://voelkerrechtsblog.org/the-ecjs-first-bitcoin-decision-right-
outcome-wrong-reasons/.
13
ECB (2015, pp. 23 ss).
14
BaFin (2014), https://www.bafin.de/SharedDocs/Veroeffentlichungen/EN/Fachartikel/2014/fa_
bj_1401_bitcoins_en.html.
6 1 Interdisciplinary Introduction to Money and Currencies

(banknotes or central bank book money), which generally does not enjoy the status
of legal tender, but is regularly accepted as payment in commerce. Combined, the
financial institutions generate the money in any given currency area. While central
banks possess the ability of (theoretically) limitless creation of money (and also
elimination of money by reselling e.g. bonds on the market), commercial banks
often face a liquidity problem: Loans can ultimately only be repaid with central
bank money, whose supply is limited by the central bank. The problem is similar to
the one described above, resulting from the obligation to convert into gold or silver.

1.2.2 Monetary Aggregates

The amount of money in circulation is described using different monetary aggre-

gates (M0, M1, M2, M3).15 M0 describes the monetary base or high powered
money (central bank money). In reality, commercial banks have developed an
increasing number of financial products (assets), which fulfil more or less monetary
functions (depending on their characteristics) and therefore exhibit varying degrees
of “moneyness”. Monetary aggregates reflect this by differing in terms of liquidity
and included assets, from M1 (narrow) over M2 (intermediate) to M3 (broad). M3
is generally considered the best indicator for future developments in the overall
level of prices, as it includes a wide range of financial assets. Coincidently, it is also
the aggregate least affected by central bank influence.
The actual macroeconomic amount of money supplied is a product of M0 and a
multiplier, which is determined by the central banks’ minimum reserves policy and
the preferred relation between cash and commercial bank money held by
non-banks. Although this formula suggests absolute control by central banks over
the supply of money (making it a quantity determined by exogenous factors), many
argue that the activity of commercial banks has a significant influence, turning it
into a quantity determined by endogenous factors in reality. The demand of money
on the other hand is defined as the preferred cash management of non-banks. In this
regard, money competes with other forms of storing value like bonds, immobile
assets etc. whereby non-banks are assumed to have an affinity for liquidity. The
short- and long-term stability of the monetary demand is highly debated among
economists; so far, the empirical data is inconclusive in this respect.

1.2.3 Monetary Policy and Policy Instruments

Monetary policy itself is defined as the targeted exercise of influence on the supply
of money in an economy by influencing monetary aggregates and interest rates in

15
ECB (2011, p. 50).
1.2 Monetary Policy Basics 7

order to achieve specific economic goals. Such goals generally are the stability of
monetary value (as indicated by the level of prices), the pursuit of specific
exchange-rates and economic stabilization policies. The interrelations of these goals
are not free of conflict, usually prompting central banks to prioritize one or the
other. Central banks have an array of instruments at hand to control/influence
monetary processes. Among them are the creation of central bank money, deter-
mination of the central rate, minimum reserve obligations for commercial banks to
limit their ability of generating money, and open market operations. An important
task of monetary policy is to guarantee a sufficient supply of money in order to
secure the liquidity of the banking sector, while at the same time setting limits for
their refinancing options in order to prevent excessive spending activities, which
would threaten financial markets and policy goals likewise.

1.2.4 Currencies

Money has an internal value, the purchasing power, and an external value, the
exchange-rates. The exchange-rate is subject to the exchange-rate policy (techni-
cally a subchapter of monetary policy). The decisive parameters for the currency
policy are the convertibility of the currency into foreign currencies and whether the
exchange-rate is free floating or fixed. The differentiation of internal and external is
somewhat artificial as exchange-rate policy decisions can affect the internal value of
money as well. An increase of the exchange-rate, for example, reduces the
inflationary tendencies, due to cheapened imports and a decrease in demand abroad
for national products. Conversely, the purchase of the national currency by central
banks in exchange for foreign currencies expands the amount of (national) money.

1.2.5 Monetary Policy and Fiscal Policy

Monetary and fiscal policy are linked as well. This link is most obvious when the
“banknote press” is employed or when public budgets are directly financed with
central bank money (monetisation of sovereign debt) as both measures directly
expand the amount of money circulating and thus have inflationary effects.

1.3 Money and the Law

Initially, despite the works of some scholars, law was not considered to play an
important role in the monetary sphere as theories of metallism and means of
exchange dominated the conception of both the idea of money and its value. Yet,
8 1 Interdisciplinary Introduction to Money and Currencies

according to the state theory of Knapp, “money is a creature of law”. In this

absoluteness, money would only be conceivable in combination with a sovereign
authority. Legal acts would be the defining force in monetary matters. But are they?
Firstly, the State theory did help to overcome the era of metallism and the idea
that any monetary system needs to be backed by silver or gold and equipped with
an obligation to convert in order to be stable and functioning. Also the monetary
monopoly of States, which is almost invariably established by modern constitu-
tional law, is effectively recognised as part of their sovereignty by international law
(see Chap. 2). Furthermore, legal rules as well as the judiciary play an important
role in economic and commercial life. But at the same time the State theory mis-
takes a natural and practical (State) monopoly for a natural right to define and
control money. The validity of money depends largely on broad popular accep-
tance. People will only accept payment/consideration in money, because they
expect other members of the same society will behave in the same manner. The
acceptance, originally stemming from the appreciation of the substance used, is
nowadays indeed based on a legal foundation: obligation to accept as payment,
prohibition of other currencies, taxing authority of the State. The State’s influence
on acceptance, however, is ultimately limited. Legal definitions, for example, can
only ever affect concrete forms of money, but are incapable—since it is simply
impossible—of legally influencing the purchasing power of money by denomina-
tion. Moreover, even the law itself provides examples of a broader sense of the term
money, e.g. § 35 of the German Bundesbank Act,16 which clearly identifies other
means of exchange different from the legal tender as money.
Ultimately, defining money as a creature of law amounts to disregarding the
socio-economic dimension of money. Therefore, the State theory approach has
subsequently been modified, in order to be able to explain real life developments
such as non-acceptance of the legal tender. It has been argued that legal regulations
concerning money could be altered by customary law. Others claimed that the
refusal of acceptance does not merely affect the characterisation of money; rather, it
deprives the underlying norm of its legal status altogether. Hahn and Siebelt on the
other hand asserted a dual creation process for money, meaning that money depends
on both law and social acceptance. Similarly, Proctor attributed to law the ability to
abstractly define what money is, but found that the State lacks control over what is
actually used as means of payment within the economy.
Another controversially discussed question is whether the obligation to accept
the legal tender is at all a prerequisite for money. Two counterarguments should be
considered: Firstly, this would limit the State’s power to create a monetary system
without such an obligation and secondly, foreign money would then automatically
lose its monetary status, due to its lack of legal tender status abroad. However,
foreign money is clearly regarded as money in legal norms such as § 146 of the

16
An English version of the Bundesbank Act can be found at http://germanlawarchive.iuscomp.
org/?p=833#35.
1.3 Money and the Law 9

German Criminal Code.17 The obligation to accept a legal tender is therefore more
likely to have practical consequences when a competing means of exchange is
circulating and a broader acceptance of the legal tender, which it has not achieved
based on its value or quality, needs to be secured.
In summary, the State is free to define money through legal acts. This is part of
the sovereignty of each State. However, law is more commonly used to regulate
what already exists, rather than as a tool for invention. The aforementioned
socio-economic phenomenon of money thus details what legally could be regarded
as money; not what the law actually does recognise as money. This does not
automatically render the State theory meaningless nor does it mean that law has no
influence on money at all. A modern economy needs a functioning monetary
system. A collapse would have severe consequences for the economy and the
wellbeing of the population. It is therefore unlikely that a State will leave monetary
issues solely to the social and economic market forces. Monetary regulations are
necessary and play a dominant role today, for example in contract or public
international law. Maybe the role of the State is best described as that of a company
with a dominant market position, which protects the company’s standard and
market share (tax demands and public payments) with all available methods and
consistently defies any competition.

References

BaFin (2014) Bitcoins: Supervisory assessment and risks to users. https://www.bafin.de/

SharedDocs/Veroeffentlichungen/EN/Fachartikel/2014/fa_bj_1401_bitcoins_en.html
Davies G (2016) A history of money, 4th edn. University of Wales Press, Cardiff
ECB (2011) The monetary policy of the ECB 2011. https://www.ecb.europa.eu/pub/pdf/other/
monetarypolicy2011en.pdf
ECB (2015) Virtual currency schemes—a further analysis. https://www.ecb.europa.eu/pub/pdf/
other/virtualcurrencyschemesen.pdf
Herrmann C (2010) Währungshoheit, Währungsverfassung und subjektive Rechte. Mohr Siebeck,
Thübingen
Knapp G (1923) Staatliche Theorie des Geldes, 4th edn. Duncker & Humblot, München
Maupin J (2015) The ECJ’s first Bitcoin decision: right outcome, wrong reasons? http://
voelkerrechtsblog.org/the-ecjs-first-bitcoin-decision-right-outcome-wrong-reasons/
Simonite T (2011) What Bitcoin is and why it matters. MIT Technology Review. http://www.
technologyreview.com/news/424091/what-bitcoin-is-and-why-it-matters/
Spahn H-P (2003) Money as a social bookkeeping device. From mercantilism to general
equilibrium theory
The Economist (2015) The trust machine. The economist. http://www.economist.com/news/leaders/
21677198-technology-behind-bitcoin-could-transform-how-economy-works-trust-machine

17
An English version of the Criminal Code can be found at http://germanlawarchive.iuscomp.org/?
p=752.
Chapter 2
Monetary Sovereignty and History
of International Monetary Law

2.1 Monetary Sovereignty under Public

International Law

The aforementioned principle of monetary sovereignty plays an important role in

monetary law and is key to understanding international monetary relations
notwithstanding the much discussed potential erosion of the principle.

2.1.1 The General Principle of Sovereignty

Like the term money before the principle of sovereignty is not as easily accessible
as the widespread use of the term in legal, political and economic discussions might
suggest. The complexity stems on the one hand from the issues (legality, legitimacy
and power) involved and on the other hand from sometimes varying understandings
of the term in different academic fields.

2.1.1.1 Content of the Principle

The legal principle of sovereignty generally encompasses the supreme authority

within a territory entrusted to the State as the political institution (internal dimen-
sion or sovereignty within the State) as well as its international independence from
other States or from interference with its internal affairs (external dimension or
sovereignty of the State) except for obligations under public international law. In a
nutshell, sovereignty hence denotes a status of self-determination and indepen-
dence.1 Today, it is among the fundamental principles of public international law

1
See also M. Huber in Island of Palma Case (Netherlands vs. USA), 1928, 2 UNRIAA 829.

© The Author(s) 2017 11

C. Herrmann and C. Dornacher, International and European Monetary Law,
SpringerBriefs in Law, DOI 10.1007/978-3-319-57642-8_2
12 2 Monetary Sovereignty and History of International Monetary Law

and considered to be one of the guiding concepts of international relations (cf. Art.
2 (1) Charter of the United Nations).

2.1.1.2 Historical and Theoretical Development of the Principle

Historically, the modern concept of sovereignty is closely linked to the evolution of

the nation state in Europe. Thus, the Peace of Westphalia in 1648,2 ending the
Thirty Years’ War, is often cited as the starting point of a system of sovereign
States. Against the backdrop of medieval (often religiously motivated) struggles for
power and competence between clergy, nobility, classes and cities, a unifying
authority was regarded as the only potential safeguard to establish and preserve
peace and order.3 It is not surprising therefore that Jean Bodin4 developed the idea
of a State equipped with absolute and lasting force, which is only subject to God’s
or nature’s law, certain general legal principles and contracts the respective State
has entered into.5 Internally, the most important development in the conception of
sovereignty and its origins was the change from sovereignty of the monarch (Bodin,
Hobbes, Machiavelli) to sovereignty of the people (Locke, Montesquieu, Rousseau).
Consequently, the State was (and still is) understood as an aggregate of individuals,
who are the original sovereignty-holders, representing and exercising their collec-
tive will through its (constitutionally prescribed, elected) bodies. Externally, the
removal of the personal link between sovereignty and monarch was facilitated by
the perception of the State as a judicial entity. The judicial entity “State” could
replace the monarch, a natural person, as the bearer of sovereign rights. Thus,
sovereignty of the State and not only within the State became possible. Today,
voices in academic and popular literature predicting the steady erosion or at least a
significant alteration of the principle due to constraints caused by economic glob-
alization and increasingly integrated financial markets worldwide are becoming
louder. Specifically with regard to Greece and Argentina the issue of sovereignty
infringements has been raised. Let it suffice here to note that the exercise of
sovereignty has never been absolute but always depended on what was possible in
reality. Therefore it seems reasonable to separate legal from political sovereignty,
the latter often being more a question of power rather than legal rights and subject
to constant change.6

2
http://www.britannica.com/event/Peace-of-Westphalia.
3
See for example: Fowler and Bunck (1995, pp. 4 s), Herrmann (2010, p. 90).
4
www.constitution.org/bodin/bodin.txt.
5
Before, the adjective “sovereign” was used mainly in legal procedure terminology to signify the
non-appealability of last instance court decisions. For a more detailed overview of the philo-
sophical development see Lastra (2015, pp. 6 ss).
6
Herrmann (2010, p. 92 ss).
2.1 Monetary Sovereignty Under Public International Law 13

In summary, by its very nature as an abstract concept, sovereignty has on some

occasions shaped political reality but often also merely retraced that reality, inte-
grating it into a legal framework.

2.1.2 Monetary Sovereignty

“It is indeed a generally accepted principle that a state is entitled to regulate its own
currency.”7
Monetary sovereignty is part of a State’s sovereignty and signifies the power to
issue and regulate money within a specified territory. The above statement by the
Permanent Court of International Justice is often cited as authority for the existence
of monetary sovereignty for lack of an express recognition or definition in the
Charter of the United Nations (UN) or the IMF Articles of Agreement. Proctor even
places money among the prima facie matters of a State.8 This is particularly
interesting since monetary matters were by no means originally State matters as
outlined in Chap. 1. Rather, States have successfully taken over monetary matters
due to some practical advantages they have compared to private entities. It was only
afterwards that philosophers and jurists fortified the existing exercise of the right
with theoretical reasoning and integrated it into a coherent legal framework.9 The
wording of the judgment, in particular, suggests a customary legal nature of
monetary sovereignty, indicating that the concept is potentially dynamic as it
depends on a generally accepted practice.10

2.1.2.1 Content

Monetary sovereignty resides with the nation State and not with central banks
despite their prominent role in monetary matters. The right encompasses the power
to issue a currency (lex monetae/ius cudendae monetae), to regulate money, to
control monetary policy, to control the exchange-rate policy and to impose
exchange and capital controls.11 It follows from this that States must generally
recognize monetary legal acts of other States, which is especially important in
contract law (currency changeover).12 One particular side effect of this rule of

7
www.icj-cij.org/pcij/serie_A/A_20/62_Emprunts_Serbes_Arret.pdf, http://www.icj-cij.org/pcij/
serie_A/A_20/62_Emprunts_Bresiliens_Arret.pdf.
8
Proctor (2012, p. 526).
9
Zimmermann (2013, p. 9).
10
Similarly Lastra (2015, p. 18).
11
Lastra (2015, p. 19), Proctor (2012, pp. 500 s, 526 s).
12
For a more detailed analysis of the recognition of the exercise of specific aspects of monetary
sovereignty see Proctor (2012, pp. 526 ss).
14 2 Monetary Sovereignty and History of International Monetary Law

international law is the phenomenon known as currency war: States seeking to

secure an economic advantage by manipulating the value of their currencies. The
manipulation can occur in three ways: (1) inflexible pegs of undervalued currencies;
(2) resisting a currency appreciation in a floating exchange-rate regime and
(3) quantitative easing.13 Especially China has been accused of such tactics in past
years.14 There is no ground for impugning such measures in general international
law, since they constitute a direct exercise of sovereign rights. Yet, they may violate
certain obligations under the IMF Articles of Agreements (see Chap. 5).

2.1.2.2 Erosion of the Principle

Nevertheless, the monetary monopoly of the State has been questioned in recent
years with some arguing that it is on the verge of erosion due to voluntary surrender
but also due to limitations caused by globalization, information technology and
economic and financial developments in the past decades.15
A prominent example of a voluntary surrender is the European Monetary Union
(EMU). The transfer of specific sovereign powers to the European Union (EU) has
been understood to erode or at least limit the sovereignty of individual Member
States. In terms of competences, this assessment might be accurate; Member States
of EMU are, for example, no longer competent to set a monetary policy. Another
argument often brought forward to this end is the irrevocability of the EMU, since
no exit provision exists in the Treaties apart from Art. 50 Treaty on European Union
(TEU), which allows Member States to leave the EU altogether.16 Yet rather than
focusing on matters of competence or power it is noteworthy that a voluntary
transfer of sovereign rights in accordance with international law constitutes one
form of exercising such sovereign powers and not an infringement of them. Thus,
Zimmermann convincingly considers the EMU a “joint exercise” or “a form of
cooperative sovereignty” rather than a limitation or erosion.17 With regard to the
IMF, mainly its role during the financial crisis has been criticized, the allegation
being that it exerts too much influence by making financial assistance conditional
on ever more specific structural reforms and therefore practically determining a
variety of domestic policies.18 This again is an allegation based on factual

13
Pisani-Ferry and Darvas (2010, p. 3).
14
For a detailed analysis of China see Garcia-Herrero (2015).
15
Lastra (2015, p. 20); Considering the participation in the EMU to be a limitation of sovereignty
see also Treves (2000, p. 116).
16
It is disputed among commentators whether it is indeed impossible for a Member State to leave
the EMU but not the EU. See https://www.ecb.europa.eu/pub/pdf/scplps/ecblwp10.pdf.
Additionally, the “irrevocability” wording of the Maastricht Treaty was eliminated by the Lisbon
Treaty (see Art. 119 II TFEU) and even originally did not address the Member States as ‘masters
of the treaties’ but referred to secondary law and thus addressed EU or formerly EC institutions.
17
Zimmermann (2013, p. 143 s); see also Mabbett and Schelkle (2014).
18
See Lowenfeld (2002, p. 257).
2.1 Monetary Sovereignty Under Public International Law 15

developments or power considerations and not a de jure situation reflected in the

IMF Agreement, which actually reasserted national sovereignty with the second
Amendment in 1978. Globalization and so called “private money” are frequently
cited as threats to monetary sovereignty as well. In this context, globalization refers
to the “deterritorialization” of money which stands in contrast to the territorial link
of national sovereignty.19 Control over the currency ultimately diminishes when it
circulates globally and escapes the confinement of national borders. Private money
(substitute, parallel or virtual currency) on the other hand will start circulating if the
acceptance of the legal tender declines or vanishes completely. Both phenomena,
however, again rather exemplify a weakened effect/success of national monetary
policy or regulation not a loss of the sovereign right itself.
At the outset, monetary sovereignty was identified as a dynamic concept. Hence
the legal principle can theoretically be altered by factual changes. Time, State
practice and acceptance are the key requirements to alter a customary legal prin-
ciple. There is no evidence that any of the alleged threats indeed fulfills these
requirements, especially regarding the latest re-nationalization developments some
financial markets and institutions are experiencing in the aftermath of the financial
crisis.

2.2 History of International Monetary Law

Before 1944, there was practically no international monetary law. The gold stan-
dard, which had evolved during the 19th century, functioned without any legally
binding regulation at international level and up until the World War I monetary and
capital flight were hardly limited.

2.2.1 Gold Standard

The international gold standard was a monetary understanding amongst the major
countries to use gold as the main reserve asset. As outlined in Chap. 1, the gold
standard started with the end of bimetallism, which was brought about when most
countries gradually opted for gold instead of other precious metals as a reserve
asset. England was the first in 1717 and as others followed gold was universally
used by 1870.20 The gold standard lasted until 1914. The underlying understanding
was that each participating country would guarantee the free convertibility of its
currency into gold at a fixed price. This, of course, facilitated the free convertibility

19
See Cohen (2000, p. 1).
20
Davies (2016, p. 357).
16 2 Monetary Sovereignty and History of International Monetary Law

of each currency into all other currencies at a fixed price.21 The understanding,
however, was not based on a formal international agreement and thus did not
impose any international legal obligation upon the countries adopting the gold
standard.22 As the name indicates, gold was the system’s core. The value of cur-
rencies was fixed against gold by the countries and the central banks held gold in
their reserves to defend/back up that fixed price (so called “pure” gold standard).23
Even before World War I some countries were already on a so-called
gold-exchange standard, meaning that their central banks did not or not entirely
hold reserves in gold, but also currencies of countries whose reserves consisted
entirely of gold. At the time, the preferred (reserve) currency was Sterling, after
World War II under Bretton Woods (for details see below) it was the US Dollar.

2.2.2 The Creation of the Bank for International

Settlements (BIS)

The acrimonious atmosphere after World War I thwarted all attempts to focus on
reestablishing peace and prosperity. Instead, the Treaty of Versailles of 29 June
1919 imposed reparation payments on Germany (and its allies) and a universal
reintroduction of a system similar to the gold standard failed. Even though some
countries adopted certain features of the gold standard unilaterally between 1925
and 1931, the system was entirely abandoned in 1931. The issue of reparations was
first addressed by the Dawes Plan and later by the Young Plan.24 In the context of
the latter, the Bank for International Settlements (BIS)25 was established in 1930 to
administer German reparation payments (a task previously performed by the Agent
General for Reparations in Berlin) and to serve as a trustee for the Dawes and
Young Loans (to finance reparations). Further objectives of the BIS included the
promotion of central bank cooperation and financial assistance (cf. Art. 3 Statutes of
the BIS). At the time the relevance of the BIS was soon undermined though by the
end of reparations in 1933/34, the breakdown of the gold standard and the attitude
of most countries (see below).26 The Bretton Woods conference even called for its
liquidation in the Final Act of the conference, opting to create a new institution over
reviving the existing one. Ultimately, the liquidation plan was never put into action
and the BIS has indeed developed into a center for central bank cooperation and

21
Davies (2016, p. 357).
22
Lastra (2015, p. 409).
23
Lastra (2015, pp. 409 s).
24
Named after an American Banker O. Young, who presided over a Committee of Experts to
resolve the issue of German reparations.
25
For a detailed study of the history of the BIS see Toniolo (2005, Chap. 2 ss).
26
Lastra (2015, p. 411).
2.2 History of International Monetary Law 17

institutional home for a variety of committees dealing with international financial

standards.27

2.2.3 The Establishment of the IMF

The Articles of Agreement of the IMF were adopted on 22 July 1944 by 44 of 45

member states (the Soviet Union never became a signatory) participating in the
International Monetary and Financial Conference of the United and Associated
Nations taking place in Bretton Woods, New Hampshire (commonly referred to as
Bretton Woods).28 The narrative of Bretton Woods, which consists of three pillars:
the IMF, the International Bank for Reconstruction and Development (IBRD,29
better known as World Bank) and International Trade Organization [ITO, never
came into existence, now World Trade Organization (WTO)],30 was to win the
peace and learn from past experience.31
The inter-war period namely was marked by tensions, instability and economic
problems (the Great Depression with worldwide effects32; high reparations, onerous
war debt and high unemployment specifically in the case of Germany). It is widely
believed that the economic problems in particular were a significant contributing
factor in the breakdown of the peace.33 There were initiatives to find cooperative
solutions on an international level to tackle the effects of the depression and restore
stability (cf. the London International and Monetary Conference 193334 or the
objectives of the BIS). This aim was never achieved though as international eco-
nomic collaboration collapsed against the backdrop of severe economic and
political tensions,35 which destabilized democratic regimes not only in Germany
and heralded a phase of external policies driven purely by national considerations.
The establishment of the Bretton Woods system was a milestone in international
monetary law since it was the first international legal system governing monetary
relations. The IMF Articles of Agreement, entering into force on 27 December
1945, imposed legal obligations on member states for the first time. Despite
changes to the Agreement (see below), it continues to be the basis for international
economic governance in monetary matters. The initial purpose of the IMF was to

27
Lastra (2015, pp. 414 s).
28
Today the IMF has 189 members, http://www.imf.org/external/about.htm.
29
The task of the IBRD was meant to be the facilitation of post-war reconstruction, though in the
end the Marshall Plan proved to play the key role in that regard.
30
This reflects the three dimensions of economic relations: Money, Investment and Trade.
31
The expression goes back to Keynes (1919).
32
For a detailed study see Friedman and Schwartz (1965).
33
For a detailed outline of the inter-war period see Lastra (2015, p. 410 ss).
34
Toniolo (2005, pp. 144–149).
35
E.g. Industrial production dropped by 47% in the USA between 1929 and 1932.
18 2 Monetary Sovereignty and History of International Monetary Law

foster cooperation and reconstruction after World War II in order to avoid repetition
of the disastrous consequences resulting from economic policies adopted during the
inter-war period by establishing an open and non-discriminatory international
monetary system, a system of convertibility, exchange-rate stability and avoidance
of restrictions on current payments.36 Largely, it can be viewed as a means to
stabilize international economic relations and cooperation in order to contribute to
the preservation of peace. Other commentators argue that it also marked the
beginning of the Cold War due to the Soviet Union not signing the agreement.37

2.2.4 The IMF’s Development

The IMF, also known as the Fund, evolved significantly over the course of its
existence, trying to adapt to the challenges it faced during the 70 years it played a
part in shaping the global economy. Likewise, the legal basis, the Articles of
Agreement, was amended and changed over time. The seven decades can be
roughly divided into five periods: Cooperation and Reconstruction (1944–71); the
end of the Bretton Woods regime (1972–81); Debt and painful reforms (1982–89);
Societal Changes for Eastern Europe and Asian Upheaval (1990–2004);
Globalization and the Crisis (2004–today).38

2.2.4.1 The Collapse of the Par Value System

The first milestone marking a change in the working of international monetary

relations was the collapse of the par value system (also known as Bretton Woods
regime). Under the original Articles of Agreement, a par value system was intro-
duced, which could be described as a gold-dollar standard. The value of each
member’s currency was either defined in gold or in US Dollar, which had a fixed
gold value [see Art. IV sec. 1 (a)]. The convertibility of the Dollar into gold at the
fixed price was guaranteed by US monetary authorities. Participating members on
the other hand were obliged to convert their currency into Dollars at a fixed price
(official exchange-rate or parity rate). Theoretically, the original Articles of
Agreement offered the possibility of adjusting the par value under certain cir-
cumstances (Art. IV sec. 5 (a) and 7). Initially the system seemed to offer pre-
dictability and stability of international monetary relations while creating a clear-cut
mandate for the IMF to enforce adjustment rules and provide temporary resources
in order to deal with short-term balance of payments problems. However, the par

36
See http://www.imf.org/external/about/whatwedo.htm#key.
37
James (1996, p. 70).
38
See http://www.imf.org/external/about.htm.
2.2 History of International Monetary Law 19

value system suffered from a decisive problem, referred to as the Triffin dilemma.39
At the core of the dilemma lies the ultimately limited supply of gold. A growing
world economy implies an increase in demand for Dollar reserves. If these demands
were to be accommodated, the Dollar/gold ratio would increase too, meaning that
the fixed price will not represent the actual value of the Dollar anymore. This would
lead to a decline in confidence in the US’ ability to convert the Dollar into gold and
consequently cause a rush to convert existing Dollar reserves, ultimately forcing the
collapse of the system. If the demands were not to be accommodated, the world
economy would likely succumb to deflation.
Already in the early 1960s it became apparent that the gold reserves were
insufficient. Countermeasures by the central banks of the US, UK, Belgium, France,
Netherlands, Germany, Italy and Switzerland included the creation of a “gold pool”.
Yet the parallel existence of private gold markets rendered it extremely difficult to
keep the gold price stable. The ensuing abandonment of the gold pool project
enabled the private gold price to be determined through supply and demand, trig-
gering a rise of the gold price. The IMF tried to meet foreseeable liquidity problems
by creating a supplementary exchange reserve asset, defined and maintained by the
IMF: the Special Drawing Rights (SDR).40 As the gold price continued to rise, even
this measure proved to be insufficient. The US was forced to suspend the con-
vertibility of Dollars into gold.41 Another contributor to the collapse was that the
adjustment “tools” foreseen in the original Articles of Agreement were not used due
to political reasons. Attempts to repair the collapsed system failed. What resulted
from the collapse was a de facto adoption of free floating exchange-rates in contrast
to the fixed exchange-rates in operation before.42

2.2.4.2 Second Amendment to the IMF Articles of Agreement

The Second Amendment (1978) to the IMF Articles of Agreement introduced two
major changes. Firstly, it officially permitted what was already common practice
amongst member States: floating exchange-rates. Secondly, it transformed the role
of the IMF. In the absence of substantive legal regulations permitting the Fund to
control the exchange-rate arrangements of its members, the emphasis shifted from a
primarily monetary one to a financial one, taking on issues such as supervising
banking and capital markets, financial reform and debt restructuring in line with the
broad objectives of the IMF, Art. I of the Articles of Agreement.43 Surveillance
became the Fund’s central task. Originally this shift could probably be regarded as a

39
Triffin (1960).
40
See http://www.imf.org/external/np/exr/facts/sdr.htm.
41
President Nixon formally declared the abandonment of the commitment to convert on 15 August
1971.
42
For a detailed outline of developments after the collapse see Lastra (2015, p. 420 ss).
43
Lastra (2015, p. 432).
20 2 Monetary Sovereignty and History of International Monetary Law

decline in power for the Fund. During times of financial crisis and sovereign debt
restructuring/crisis, however, the IMF has played a key role in the past and con-
tinues to do so: 1980s sovereign debt restructuring of less developed countries
(LDC); 1990s transition to market economies of formerly communist
countries/financial crises; 2007–today global financial crisis and Euro area sover-
eign debt crisis. These situations proved that when members are dependent on
immediate financial assistance, surveillance, risk assessment and decisions of the
IMF become rather powerful (perhaps too powerful, as some argue) tools despite
the lack of substantive enforcement provisions in the Agreement.

2.2.4.3 Further Amendments

In order to enter into force, an Amendment to the IMF Articles of Agreement

requires positive acceptance by three fifths of IMF members (currently 113 of the
189 members), representing 85% of the IMF’s total voting power. Several further
Amendments have been proposed and are awaiting acceptance, others have yet to
enter into force.44 Today, the three main functions of the IMF are: surveillance,
financial and technical assistance.45 The IMF itself seems to seek a more enhanced
role in promoting global stability by expanding its mandate in particular with regard
to financial sector issues. Thereby, the IMF is of the opinion that the current legal
framework offers enough flexibility and allows for a broader interpretation which is
still in line with the Vienna Convention of the Law of Treaties, Art. 31–32. This
reasoning has to be seen within the context, however, that going through the
amendment procedure in order to expressly expand the IMF’s mandate would be a
difficult task with an incalculable outcome.

References

Cohen B (2000) Life at the top: international currencies in the twenty- first century, Princeton
University essays in international economics No. 221. Princeton University Press, Princeton
Fowler M, Bunck J (1995) Law and power and the Sovereign State. Penn State University Press,
State College
Friedman M, Schwartz A (1965) The great contraction 1929–1933. Princeton University Press,
Princeton
Garcia-Herrero A (2015) Internationalizing the currency while leveraging massively: the case of
China. Bruegel, Brussels. http://bruegel.org/wp-content/uploads/2015/10/wp-15-121.pdf
Herrmann C (2010) Währungshoheit, Währungsverfassung und subjektive Rechte. Mohr Siebeck,
Thübingen

44
Information on the current status of Amendments can be found here: https://www.imf.org/
external/np/sec/misc/consents.htm.
45
See http://www.imf.org/external/np/exr/facts/glance.htm.
Exploring the Variety of Random
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Kauppaneuvoksen kuoltua
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Title: Kauppaneuvoksen kuoltua

Näytelmä 3:ssa näytöksessä

Author: Maila Talvio

Release date: May 21, 2024 [eBook #73666]

Language: Finnish

Original publication: Porvoo: WSOY, 1905

Credits: Tapio Riikonen

*** START OF THE PROJECT GUTENBERG EBOOK

KAUPPANEUVOKSEN KUOLTUA ***
KAUPPANEUVOKSEN KUOLTUA

Näytelmä kolmessa näytöksessä

Kirj.

MAILA TALVIO

Porvoossa, Werner Söderström Osakeyhtiö, 1905.

HENKILÖT

LOUISE AHLFELT, kauppaneuvoksen leski.

SIGRID WILLARDT, |
EDITHA, | hänen tyttärensä.
TIREHTÖÖRI ALLAN WILLARDT, Sigridin mies.
ROLF, heidän lapsensa.
OIVA LAHTONEN, konttoristi Ahlfeltilla.
ARMAS SALOKANNEL, runoilija.
PENTTI MARTO, kuvanveistäjä.
HELLA ASP.
GUNNAR KILPI.
LAHTOSEN ÄITI.
TYÖMIES ÅSTRÖM.
GRÖNLUNDSKA.
ANDERSSONSKA.
Ahlfeltin palvelijoita, työmiehiä, heidän vaimojaan ja lapsiaan.

Tapahtuu parina päivänä ennen jouluaattoa sekä jouluaattona.

ENSIMMÄINEN NÄYTÖS

Suuri, matalahko, räikeän loistavasti kalustettu sali; peräseinällä

kolme ikkunaa raskaine punaisine plyyshiverhoineen. Toisella sivulla
ovi eteiseen, toisella ovi konttorihuoneisiin ja myymälään. Pöytä
tuoliryhmineen. Ympärillä KILPI, MARTO, SALOKANNEL ja HELLA ASP
(muodikkaassa kävelypuvussa, suuri hattu päässä). EDITHA
(surupuvussa) kaataa kahvia ja tarjoilee vieraille. Ulkoa kuuluu
kaiken aikaa kansanjoukon epämääräistä puhetta ja rähinää.

MARTO

No, Editha, tottahan sinä kävit Moulin Rougessa? (Marto

purskahtaa pieneen nauruun, katsahtaa Edithaan).

EDITHA (puoleksi leikillä, puoleksi hermostuneena)

Olisihan minun pitänyt odottaa että se kysymys tulee ennemmin

tai myöhemmin — täällä kotonakin!

MARTO

Kuinka niin?… Mitä…?

EDITHA

Ei mitään, ei mitään… Tai sitä vain, että… Kaikki te puhutte

ikäänkuin Moulin Rouge olisi Pariisin merkillisin merkillisyys.

KILPI

Jollei se juuri ole merkillisin merkillisyys, niin onhan se ainakin

merkillisimpiä merkillisyyksiä.

EDITHA (leikitellen, pieni kärki sanoissa)

Niin, eikö totta: Louvret ja Luxembourgit ja kaikki muut ovat

pelkkä varjo Moulin Rougen rinnalla!

KILPI

Taidetta tapaa kaikkialla, mutta Moulin Rougea ei ole kuin

Pariisissa.

MARTO

Oo — älkää luulko! Jokaisella suurkaupungilla on sekä Louvrensa

että Luxembourginsa ja Moulin Rougensa! Eikä ulkomaalaisen pidä
laiminlyödä kumpaakaan. Toinen katsotaan päivällä, toinen yöllä.

SALOKANNEL

Ei ole Moulin Rouge enää entisellään. Pariisin kuuluisa Punainen

mylly on nykyään varsin siisti paikka, jonne kuka hyvänsä saattaa
mennä. Toista oli silloin kun minä… Et sinä, Editha, siellä olisi
pahentunut.
EDITHA

Tiedänhän minä, etten olisi. Mutta ei ollut sopivaa aikaa.

MARTO

Eikä halua!

EDITHA

Olkoon menneeksi!

MARTO

Sopivaa aikaa? Uskallanko kysyä, mitä erityistä oli tekemistä?

Oletko ehkä kaikessa salaisuudessa ruvennut kirjailemaan tai
laulamaan tai maalaamaan tai… Niin, niin! Ja hämmästytät äkkiä
maailman valmiina taiteilijana. Kaikki on mahdollista Editha
Ahlfeltille!

EDITHA nauraa

Kaikki tämä siksi etten käynyt Moulin Rougessa!

MARTO

Se oli sellaista, että Editha joutui sosialistien seuraan ja sitten

katosi halu kaikkeen mikä meitä muita ulkomaalaisia huvitti…

SALOKANNEL (pitkään)

Ooo!
KILPI

Kauppaneuvos Ahlfeltin tytär sosialistien seurassa!

Oletko jo sosialisti, jauresilainen?

EDITHA

Ei siitä kannata puhua. Minä en osaa vielä aakkosiakaan. On vain

jonkinlainen hämärä aavistus… Siellä oli niin hyviä puhujia. Minä opin
kieltä ja…

SALOKANNEL

Sääli oikeastaan että se oikea Moulin Rouge meni!

EDITHA (hämmästyneenä)

Niinkö?

SALOKANNEL

Se oli niin tyypillisesti pariisilainen.

HELLA ASP

Jaa, kyllä minun täytyy sanoa että menisin sitä katsomaan, jos
Pariisiin pääsisin.

MARTO

Bravoo, bravoo!

HELLA hämillään, koettaen korjata

 Niin… tietysti uteliaisuudesta vain. Että kerran näkisin millaista
siellä sellaisessa… on… en tietysti millään lailla nauttiakseni siitä…

(Kaikki purskahtavat nauruun.)

MARTO

Mitä te nyt menitte sitä särkemään! Se oli niin herttaista.

Rehellisyys on sentään niin pukevaa nuorelle naiselle.

HELLA

Valitan että olin niin liian rehellinen. Annoin naurunaihetta.

SALOKANNEL

Siunattu se olento, joka tähän matoiseen maailmaan tuo hiukankin

naurunaihetta. Äh, täällä on niin yllin kyllin kuivaa…

MARTO

Muistatko, Editha, missä olimme viikko sitten?

EDITHA

Odotahan… tänään on perjantai… ei, torstai…

MARTO

Me läksimme Pariisista.

EDITHA
 Eikö siitä ole kuin viikko? Hyvänen aika, minusta on kuin
kokonainen iäisyys.

MARTO (katsoo kelloa)

Juuri tähän aikaan istuimme ravintolavaunussa…

HELLA

Oliko ikävä lähteä Pariisista?

EDITHA

Ehkä hiukan.

MARTO

Ei niin hiukkaakaan. Minä satuin olemaan todistajana, kun Edithan

piti erota Louvresta. Mentiin sanomaan hyvästi da Vincille, Murillolle,
Rafaelille ja muille suuruuksille. Sitten lähdettiin kuvanveisto-
osastoon, kumarrettiin Milon Venukselle, Junolle ja muille
jumalattarille. Siinä salissa sattui minulla olemaan erityiset
lemmikkini ja kun minä unohduin heitä katselemaan, joutui Editha
toisaalle…

EDITHA

Kyllä minä koko ajan tiesin missä sinä olit.

MARTO
 Mutta minä en tietänyt missä sinä olit. Etsin etsimistäni ja vihdoin
viimein tapaan hänet porraskäytävästä, vastapäätä Samothraken
taisteluenkeliä, ihan vaipuneena tämän päättömän ja kolhitun
enkelin katselemiseen. Minun täytyi pysähtyä. Ja minulle tuli ajatus:
jos joskus pistäisi päähäni hakata kuva nimeltä »Ihailu» tai
»Antautuminen» tai jotakin sellaista, niin kuvaisin sen sellaiseksi
jommoisena näin Editha Ahlfeltin erohetkellä Samothraken edessä —
pukua tietysti lukuunottamatta…

EDITHA (joka jo pari kertaa on yrittänyt häntä keskeyttää)

Anna nyt jo minullekin puheenvuoro! No niin, miksen myöntäisi

että olin ihastunut Louvreen. Mutta se olikin ainoa paikka, josta
minun oli vaikea erota. Oikein vaikea.

MARTO

Entä sosialistisi! Ja olihan muitakin ihmisiä…

EDITHA

Tietysti. Olihan sitä ehtinyt esimerkiksi bolagisteihin kiintyä.

Puolen vuoden aikana oltiin miltei joka päivä yhdessä.
(Hämätäkseen:)
Tiedättekö, minä toin mukanani pari niin kaunista
marmorijäljennöstä ja
paljon, paljon valokuvia…

KILPI

Ovatko ne jo niin että voi saada nähdä…?

 HELLA (miltei yhtaikaa)

Niin, näytä rakas Editha.

EDITHA

En vielä ole avannut mitään (miltei inholla silmäillen ympärilleen).

Mitä täällä kannattaisi! Jahka me pääsemme Valhallaan.

HELLA

Kai te muutatte ennen joulua?

EDITHA

Huomispäivänä… Jaa… ei… emme pääse ennenkuin jouluaattona.

Sillä täällä vietetään vanhan tavan mukaan kuusijuhla työväelle.

Huokaa.

SALOKANNEL

Ikäänkuin teitä siinä tarvittaisiin.

EDITHA

Ei ole ennenkään tarvittu! Mutta mamma tahtoo välttämättömästi.

(Synkistyen, hiljemmin:) Nyt kun pappakin on poissa. (Keveämmin:)
Mutta ylihuomenna Valhallaan! Minä iloitsen siitä. Täällä on niin
painostavaa, niin levotonta, niin vierasta — (inholla, pelolla) en
ottaisi mistään hinnasta asuakseni täällä. Valhalla; sinun pitää tulla,
Pentti, näkemään kotini.
MARTO

Heti kun Helsinkiin tulen.

(Katsoo kelloa.)

HELLA

Aiotteko todella vielä tänä iltana lähteä?

MARTO

Kello kahdeksan junassa. En muuten ehdi kotiin jouluaatoksi.

EDITHA

Ei nyt vielä ole kiirettä.

Ovi konttorihuoneeseen avautuu, Lahtonen astuu kiireesti sisään,

kumartaa, pysähtyy.

LAHTONEN

Anteeksi… Eikö komerserodinna vielä ole tullut?

EDITHA

Ei ole… Mutta tehkää hyvin ja tulkaa juomaan kahvia. Ehkä minä

saan esittää…

LAHTONEN

Kiitoksia… Puoti on täynnä väkeä.

 (Kumartaa, on menemäisillään.)

EDITHA (on noussut, seuraa)

Olisiko ollut jotakin kiireellistä?

LAHTONEN

Olisin vain kysynyt huomisesta kuusijuhlasta… Ja sitten täällä on

eräs… joka tahtoisi tavata komerserodinnaa…

EDITHA

Kuka se sitten on?

LAHTONEN

Köyhä vaimo vain.

EDITHA

Mitä hän…?

Etsii esiin kukkaronsa.

LAHTONEN (salatulla ivalla ja katkeruudella)

Ei ole pyytämässä.

EDITHA

Mitä hän sitten…? Onko jotakin tapahtunut? (Menevät yhdessä

konttorihuoneisiin).
HELLA

Voi kuinka minun on sääli Edithaa! Hän koettaa hillitä itseään,

mutta kyllä näkyy että hän kärsii. Hän joka ennen oli niin iloinen ja
täynnä elämänhalua. Olisikohan parempi että lähtisimme pois?

SALOKANNEL

Helpommin hän vain unohtaa, kun on ihmisiä ympärillä.

KILPI

Mutta eikö hän nyt vähitellen ala tottua? Ei ihminen sentään jaksa
koko ikäänsä surra. Johan kauppaneuvos on ollut haudassa pari
kuukautta.

HELLA

Kyllä, kyllä… Mutta Editha palasi ulkomailta vasta eilen.

KILPI

Tietysti hän Pariisiin sai tiedon.

SALOKANNEL

Tietysti. Mutta on nyt aina hiukan vaikeaa palata kotiin sellaisten

tapausten jälkeen.

KILPI

No… no… no… ymmärrän.

HELLA

Edithalle mahtoi olla kamalaa sinne saada se tieto.

MARTO

Hän sairastui. Pariin päivään ei häntä kuulunut Duval'iimme Boul.

St. Miehin varrella. Kun vihdoin menimme häntä katsomaan, makasi
hän kuumeessa ja houraili olevansa kotimatkalla. Huuteli isäänsä…
isänsä koiraa… isänsä ratsuhevosta…

HELLA

Editha raukka! Hän rakasti isäänsä aivan mielettömästi.

KILPI

Editha ei tuntenut isäänsä.

SALOKANNEL

Kukapa häntä oikeastaan tunsi! Se on: kaikki tunsivat eikä

kuitenkaan kukaan. Harva ihminen kai on niin yksinään kulkenut
elämän läpi kuin hän. Kaikki puhuivat kauppaneuvos Ahlfeltin
samppanjakesteistä uudenvuodenpäivänä, kaikki kadehtivat niitä
onnellisia jotka saivat olla mukana Valhallassa Louisen päivänä.
Huvila oli kuin satulinna salaperäisessä elokuunyössä… Eikö jokainen
tässä kaupungissa olisi tuntenut kauppaneuvos Ahlfeltia, kun hän
komeissa vaunuissaan ajoi kadulla? Kaupunkilaiset tunsivat yksin
hänen koiransakin…

MARTO
 Niin, niin… Sen muistan minäkin. Koulupoikana minä sitä kovasti
pelkäsin… Mikä kumma sen nimi nyt olikaan…? Asch… Sanoihan
Edithakin sen houriessaan…!

HELLA

Tom se oli. Aina vain Tom. Uusi Tom kun edellinen kuoli.
Ajatelkaapa, tämä viimeinen Tom suri isäntäänsä niin, että se vain
etsi ja etsi ja ulvoi. Ei kukaan saanut siltä rauhaa. Kaksi kertaa se
tuotiin kotiin sedän haudalta ja vihdoin se oli ammuttava.

SALOKANNEL

Liikuttava juttu!

MARTO

Selvästi muistan kauppaneuvoksen koulupoikavuosiltani. Hänellä

oli tapana kävellä tännepäin juuri kun me tulimme koulusta. Me
teimme kunnioittavan kierroksen ja vaikenimme, kun ohitse
astuimme. Ja kun kuului huuto: kauppaneuvoksen vaunut! livistimme
me kiireesti pois tieltä. Kauppaneuvos oli komea ja mahtava herra!

HELLA

Ja minä muistan tämän talon aivan aikaisimmasta lapsuudestani —

silloin en vielä Edithaa tuntenut. — Minua huvitti kullattu
viinirypäleterttu oven yläpuolella. En vielä ylettynyt näkemään
ikkunaan. Kerran pyysin, että äitini nostaisi minua niin että saisin
tietää mitä ikkunassa oli ja hämmästyin kovasti, kun siellä oli vain
pulloja!
KILPI

Etkö muista, Merto, että minä Pariisiin lähtiessäsi kerroin sinulle

neiti Ahlfeltin oleskelevan Pariisissa?

MARTO

Muistan. Käskit minun varoa maailman vaarallisimpia houkutuksia,

rahaa ja kauneutta. Mutta kuinka oikeastaan oli — en ole koskaan
tahtonut Edithalta kysyä — kuoliko kauppaneuvos äkkiä?

HELLA (katseltuaan ympärilleen, kuiskaa)

Aivan äkkiä. Hän oli joutunut… jollakin lailla riitaan jonkun

työmiehensä kanssa ja kiivastui. Sai siitä halvauksen. Kun täti
huvilalta ehti tänne, ei hän enää osannut puhua. Tämä tapahtui noin
kello seitsemän ja kello yhdeksän hän kuoli.

MARTO

Vai niin, vai niin.

HELLA

Ei voi kuvata mikä sekosorto täällä syntyi. Setä oli aina johtanut
kaikkea, aivan pienimpiäkin asioita. Ihmiset tulivat aivan päättömiksi.

SALOKANNEL

Olihan täällä sentään pari taitavaa konttoristia. Lahtonen

esimerkiksi, joka on ollut sedän palveluksessa parikymmentä vuotta,
aivan pienestä pojasta.
HELLA

Ja täti itse koetti parastaan. Täti on todella ollut aivan

ihmeteltävän energinen. Ajatelkaa, herra Marto, nainen niin
epäkäytännöllinen ja hieno, joka ei ymmärrä afääreistä mitään,
heittää kauniin huvilansa, muuttaa tänne ja asuu täällä kaksi
kuukautta aivan viinakaupan nurkalla. En olisi uskonut tädissä
sellaista mielenlujuutta olevan. Kun muistaa kuka hän on!

MARTO

Mutta se viinakauppa kai se juuri on suvun rikkauden lähde. Kaipa

se niinmuodoin on kärsittävä.

HELLA

Olkoon mikä on, mutta sietämätön se on. Tuolla on aina

humalaisia, aina huutoa, aina tappelua. Eihän se mitään olisi, jos
olisivat siivosti. Varmaan ei tädillä ollut aavistusta siitä mitä se kaikki
merkitsee. Tuskin täti oli täällä vanhassa talossa käynytkään. Mutta
hän on kuin onkin kestänyt täällä kaksi kuukautta.

KILPI

Kovasti hän on vanhentunut viime aikoina.

HELLA

Onko se nyt ihme!

SALOKANNEL
 No, pian hän saa apua. Tirehtööri Willardtia odotetaan joka päivä.

(Melu kadulla enenee.)

KILPI (nousee, menee ikkunaan)

Profanum vulgus mylvii… Mikä niiden oikeastaan on?

(Muutkin menevät ikkunaan.)

HELLA (peloissaan)

Nyt ne taas rupeavat tappelemaan.

SALOKANNEL

Niitä suututtaa kun tietävät, että puoti pian suljetaan. Useat eivät
vielä ole ehtineet saada.

HELLA

Niin, onkin käsittämätöntä miksi tämä puoti suljetaan niin

aikaiseen. Muut puodit ovat auki kahdeksaan ja yhdeksään. Onko
ihme että ihmiset suuttuvat!

KILPI

Yhteiskunta laittaa välistä niin turhia määräyksiä.

NAISEN ÄÄNI (ulkoa)

Kiroan, kiroan, kiroan minä koko tämän paikan! (Hänen huutonsa

päättyy itkunsekaiseen ulinaan.) Ei penniäkään tuonut kotiin
palkastaan. Kaikki on tänne kantanut. Täällä syödään ja juodaan ja
mässätään meidän rahoillamme. Kiroan… kiroan…! (Melu
ihmisjoukossa on kasvamistaan kasvanut. On kuulunut huutoja:
poliisi! poliisi!)

HELLA (säikähdyksissään)

Kuinka hirmuisen raakoja ne ovat. Ei tällaista kai toki koskaan

tapahtunut sedän aikana. Kyllä todella täytyisi soittaa poliisille…
Mutta mihin kummaan Editha joutui?

KILPI

Jo ne rauhoittuvat. Poliisi tuli mieslukuisena.

MARTO (nauraa)

Luuletteko te, että se heistä on kauheaa? Se on heille vain

joululystiä, kuten meillä on omat joululystimme. Me panemme
joulupuuroon mantelin, me sulatamme tinaa, me… Ettekö te nyt soisi
heille pientä huvia. He kantanut. Täällä syödään ja juodaan ja
mässätään mei- (Palaavat vähitellen paikoilleen).

HELLA

Mutta se vaimo kärsi — ei se huuto tullut ilosta. Kuinka hirveällä

äänellä se huusikin! Ei se ollut joululystiä.

KILPI

Mistä sinä tiedät! Ilot ja ilonilmaisut ovat ihmisiä myöten.

(Editha palaa kalpeana, koettaen hillitä itseään.)

 HELLA rientää häntä vastaan, hellästi:

Editha kulta, missä sinä niin viivyit! Kai sinä kovasti pelästyit?

EDITHA (hengästyneenä)

Pelästyin. Kyllä täällä kaupungissa on levotonta. Kunhan me

pääsisimmekin Valhallaan. Voi kun Sigrid ja Allan pian tulisivat!

SALOKANNEL

Mikä siellä nyt sitten oli?

EDITHA

Joku vaimo vain tahtoi tavata mammaa.

SALOKANNEL

Sekö sama joka reuhasi täällä ulkopuolella?

EDITHA

Sama. Selitin ettei mamma ole kotona. Väitti ensin että valehtelen
eikä olisi lähtenyt millään. Herra Lahtosen täytyi työntää hänet ulos.
Hän kävi kourin kynsin kiinni seiniin… oveen, kynnykseen… Pelkäsin,
että hän puree Lahtosta käteen. Sitten hän huusi täällä
ulkopuolella…

HELLA

Kyllä me kuulimme.
EDITHA

Ettei hän vain tekisi mammalle mitään pahaa: Mamma on ulkona.

KILPI

Ehei! Täti ajaa vaunuissaan varsin turvallisesti. Ei tällaisia asioita

pidä ottaa niin juhlallisesti.

EDITHA

Kun minä ymmärtäisin mikä sen vaimon oikeastaan oli. Miksi hän
niin kauheasti uhkasi?

SALOKANNEL

Kai hän yksinkertaisesti tahtoi tädiltä rahaa. Sellaisiahan täällä käy

alituisesti.

EDITHA

Ei hän huolinut rahasta.

SALOKANNEL

Ohoo! Siis ylpeä yksilö! No niin, huolensa on itse kullakin.

Pääsemmekö me niistä vapaiksi? — miksi sitten he! Ole sinä
vakuutettu siitä että ihmisen tunteet ovat sitä tylsemmät jota
alemmalla sivistysasteella hän on. Luuletko että kala kärsii, kun se
pataan pistettäessä vielä hyppii — ja luuletko että tuollainen vaimo
tuntee ja kärsii, kun se kirkuu?
 EDITHA (lamassa)

Kuka sitä tietää!

MARTO

Muistatko, Editha, pikku Madelaineamme?

EDITHA

Muistan…

HELLA

Kuka oli pikku Madelaine…? Te näytätte niin… Vai eikö siitä sovi…?

MARTO

Madelaine oli vain pikkuinen katutyttö, jota Editha koetti

»pelastaa» ja joka petti Edithaa monella muotoa. Pikku Madelaine
viihtyi asemassaan erinomaisen hyvin eikä laisinkaan tahtonut tulla
»pelastetuksi».

EDITHA

Kuule Pentti, ole hiljaa…

HELLA

Ei, Editha rakas, kyllä me nyt jätämme sinut rauhaan… Olet kovin
väsynyt.

MARTO
 Aivan oikein. Minunkin tavarani ovat vielä huiskin haiskin. No,
Editha, hyvästi nyt ja kiitos kaikesta!

EDITHA (ikäänkuin heräten)

No niin, Pentti, kaunis kiitos nyt hyvästä matkaseurasta ja koko

ajasta Pariisissa. Ja tule tervehtimään, kun Helsinkiin palaat. Silloin
me jo asumme Valhallassa, silloin saat nähdä minun oikean kotini!
Hyvää joulua!

MARTO

Kiitos. Ja muista nyt, ettet saa itkeä. Se kuluttaa ja — rumentaa.

HELLA

Niin: ethän sinä enää itke! Elämässä on sentään niin paljon hyvää
ja kaunista. (Suutelee häntä.) Minä olen taas pian luonasi.

SALOKANNEL

Jaa… kai minunkin pitäisi lähteä. Mutta suoraan sanoen ei minulla

vielä ole mitään erityistä tekemistä. Jäisin mielelläni kuulemaan
Pariisin uutisia, jos…

EDITHA

Mutta sepä hauska! Jää!

(Editha saattaa vieraat eteiseen. Salokannel seuraa kynnykselle,

polttelee siinä. Kuuluu hyvästijättöjä ja hyvän joulun toivotuksia.
Salokannel palaa ensin, sitten Editha. Editha tulee hellästi
Salokanteleen luo, painautuu häneen ja purskahtaa itkuun, jota
kauan on pidättänyt.)

SALOKANNEL (heltyen)

Editha, Editha, no mitä nyt? Tyynny, tyynny…!

EDITHA

Minua niin ahdistaa ja painostaa. En tiedä… Kaikki täällä on niin

outoa. Ei tämä ole kuin kotini. Ihmiset ovat niin kummallisia. En
tunne mammaa, hän on käynyt niin vanhaksi, niin nöyräksi… en
tiedä miten sen sanoisin…! hän ikäänkuin peittää jotakin. Olisin
tahtonut kysyä papan kuolemasta. En tiedä siitä vielä mitään
tarkempaa. Kaikkiin kirjeisiini Pariisista sain vastauksen, että
kerrotaan tarkemmin kun tulen kotiin. Ja nyt ei kerro kukaan.
Mammalta en uskalla edes kysyä, kun hän on niin alakuloinen.

SALOKANNEL

Kyllä sinä sen kaiken saat aikoinasi tietää.

EDITHA

Ja sitten tämä kauppa täällä on niin inhottava. Minä en kärsi tuota

rähisevää joukkoa tuolla…

SALOKANNEL

Rauhoitu nyt, rauhoitu! Pianhan te pääsette pois Valhallaan.

Lähtekää huomispäivänä, vaikkapa tänä iltana.
EDITHA

Ei mamma suostu lähtemään ennenkuin ylihuomenna… Ja sitten

minä pelkään Valhallaakin. Täällä on kaikki niin vierasta, ettei papan
poissaolo niin paljon tunnu. Mutta Valhallassa tyhjyys oikein tulee
huutamaan vastaan. Nähdä hänen huoneensa, hänen
kirjoituspöytänsä, nähdä Tomin tyhjä nurkka… Voi pappa, pappa!
Tietää ettei hän koskaan telefonoi kaupungilta, ettei hän koskaan
enää tule… Hän oli sentään niin äärettömän hyvä ja niin kaunis ja
niin rakas minulle…!

SALOKANNEL

Enkö minä mitään merkitse pienelle Edithalleni?

EDITHA (hymyillen)

Etkö sinä mitään merkitse? Voi Armas, Armas — kuinka elämäni

olisi toivotonta ilman sinua! — (muuttuneella äänellä:) En käsitä
kuinka pappa on voinut elää täällä.

SALOKANNEL

Hänen työnsä oli täällä.

EDITHA

Hänen työnsä! Niin, meidän tähtemme hän tämän kaiken kesti.

(Inholla:)
Noiden rähisevien ihmisten joukossa.

SALOKANNEL
 Älä luule, että he sedän eläessä niinkään rähisivät.

EDITHA

He eivät tohtineet. (Vahingonilolla:) Niin, he eivät tietystikään

tohtineet! Oo kuinka minä vihaan tuota raukkamaista, matelevaa
joukkoa. Mutta että mamma on voinut kestää täällä — sitä en käsitä!
Oli onni ettei mamma ollut kuulemassa mitä kaikkia se vaimo sanoi.

SALOKANNEL

Unohda nyt se! Ehkä hän oli hullu.

EDITHA (ilostuen)

Niin, kuule, ehkä hän todella oli hullu! (Nauraa.)

SALOKANNEL

Joko sinä nyt raaskit luopua hänestä ja ruveta kuulemaan mitä

minulla on sanomista?

EDITHA

Jo, jo, jo. Nyt olen kokonaan sinun.

SALOKANNEL

Sanopa minulle nyt, etkö vain Pariisin humussa joskus unohtanut

minua?
Minä sain pari kertaa niin kauan odottaa kirjettä.

EDITHA
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