KREDIT und KAPITAL - Issue 2/1974



Gandenberger, Otto
Läuft die Besteuerung von Wertzuwächsen auf eine Doppelbelastung hinaus?

Bockelmann, Horst
Die Rolle der Banken in der Geldpolitik

Bredemeier, Sonning
Ergebnisse einer wöchentlichen Geldstromanalyse für die Bundesrepublik Deutschland

Blümle, Georg
Zur Theorie des Sparens in einer wachsenden Wirtschaft

Großeschmidt, Brita
Der konjunkturneutrale Haushalt als Element einer wirtschaftspolitischen Konzeption


Ahrens, Gerhard
Das Ringen um eine Notenbank in Hamburg um die Mitte des 19. Jahrhunderts

Book Reviews

Kuske, Hans-Martin
Finanzierung und multinationale Unternehmungen. - Das Bankgeschäft im internationalen Kapitalmarkt (Rolf Caesar)

Zahn, Peter
Die Phillips-Relation für Deutschland (Hartmut Rudloff)

Köhler, Claus (Hrsg.)
Geldpolitik - kontrovers (Hermann Quester)

Beckhart, Benjamin Haggott
Federal Reserve System (Bernd Rudolph)

Wolff, Heide
Die Liquiditätsversorgung des schweizerischen Bankensystems (Eberhard Ketzel)

Gold, Joseph
Voting and Decisions in the International Monetary Fund (Klaus Flachmann)

Sohmen, Egon
Wechselkurs und Währungsordnung (Hartmut Rudloff)

Horn, Norbert
Das Recht der internationalen Anleihen (Eberhard Wolff)


Gandenberger, Otto
"Is Taxation of Capital Gains Tantamount to A Double Burden?"

The essays takes issue with the thesis put forward by Haller in this journal, 6th year (1973) p. 255, that the taxation of capital gains - realized and unrealised - results in a double burden which is unjustified from the standpoint of taxation according to the ability to pay. Haller bases his arguments against taxation of capital gains, not on the very much more General (Hobbes-Mill-Kaldor) thesis of the double burden on savings by way of income tax; indeed he expressly rejects this General double-burden thesis.

The present essay dissects Haller's statements into individual arguments, and discusses them in detail. In particular, he distinguishes among four such arguments: (1) Value increments are not real income because they are not 'disposable' income (illiquidity argument). (2) Value increments are not economically realizable; even the taking up of credit to realize capital gains would merely amount to a 'pseudo-realization' with an inflationary effect (macroeconomic argument). (3) In the case of realized value increments taxation is not advisable at least when merely redeployment of assets is involved. A genuine - taxable - realization would be given only if the gain deriving from the value increment was used for consumption (argument of the significance of the use of realized capital gains). (4) The value increment of undeveloped land ought to be taxed because no yield other than capital gains is derived from such land (argument of the special character of purely speculative investment).

Each of these arguments is rejected as untenable in the present essay. On the basis of his deliberations the author comes to the conclusion that there are at least no fundamental differences between capital gains and other income when considered from the standpoint of distribution policy, so that taxation of both realized and unrealised capital gains - apart from the technical difficulties involved - appears justified and desirable. However, there are cases - e. g. ownership of condominium flats and one-family bouses - in which the pressure to realize gains caused by the taxation of value increments can be considered 'unreasonable' for reasons other than ability-to-pay considerations and should be prevented by appropriate exemption regulations.


Bockelmann, Horst
"The Role of the Banks in Monetary Policy"

The trend of the quantity of money corresponds roughly to the growth of the balance-sheet totals of the entire banking system; the central bank must exert influence on this trend in order to achieve goals of monetary policy. The growth of the balance-sheet figures of all the banks can be explained only by the dispositions of the individual banks with regard to their assets. If a bank feels its liquidity is greater than it considers necessary, it tries to redeploy its assets, favouring higher yields and reduced liquidity. In this process other banks then become more liquid than they want to be and react accordingly; once an impetus -has been given, it is propagated in the banking system until the actual liquidity situation does not diverge from the desired situation for any bank. Monetary policy must exert an influence on one of these two magnitudes in order to influence the growth of balance-sheet figures; as a rule the actual liquidity situation will be chosen.

The issue here is the individual liquidity situation of the banks and not say, their stock of free liquidity reserves in the sense of assets permitting recourse of the central bank. The one corresponds to the other only to the extent that some banks want to hold a minimum of such assets within the framework of their liquidity precautions. For a long time this was indeed the case, and it enabled the central bank to influence the liquidity situation of the banks by variation of the free liquidity reserves. If this condition is not satisfied, the central bank can influence the liquidity situation of the banks only by regulating the quantity of central bank money. Then there ought to be no more free liquidity reserves in the above-mentioned sense, because otherwise regulation of the quantity of central bank money cannot function. The lack of free liquidity reserves under such circumstances is by no means identical with a stringent restrictive policy. How monetary policy acts depends entirely on the extent to which the central bank makes central bank money available. Even without free liquidity reserves the banks may feel their liquidity is very ample, if the central bank pursues an appropriate policy.

The problem of regulating the quantity of central bank money lies essentially in the fact that the central bank must, of course, gain acceptance of its own ideas as to the quantity of central bank money which should be made available, but cannot do so without taking account of seasonal and other fluctuations in the need for central bank money. It cannot make use mechanically, so to speak, of the close relationship between central bank money and the monetary trend. It must utilize its monopoly in creating central bank money to provide conditions under which the banks behave in such a manner that the monetary trend aspired to by the central bank actually takes place. Here there is a combination of interest-rates and risk elements. If, in consideration of the interest rate, it is almost more attractive to lend out disposable money on the money market with a good degree of liquidity, the urge of the banks to redeploy their assets in favour of less liquid assets - and from the overall standpoint in favour of growing balance-sheet figures - is very greatly diminished. Apart from this, the banks will deem it advisable to preserve liquidity, if they observe how difficult it has become to cover deficiencies on the money market. High money market rates therefore have a strong contractive effect, particularly as long as the banks have not adjusted their interest rates for advances to the increased cost of procuring money. Following that adjustment, the restrictive effect must come primarily from the deterrent effect of the attained interest level on demand for credit.

In the short run, the banks' possible means of responding to a change in their situation caused by monetary policy are limited, in which connection special importance attaches to promises of credit. But the banks themselves should be interested in demonstration of the fact that it is possible for the central bank to pursue an effective monetary policy. Control of the creation of money is a basic requirement for an economic order based on division of labour.


Bredemeier, Sonning
"Results of a Weekly Analysis of Money Flows for the Federal Republic of Germany"

The transaction in an economy are financed with payments, i. e. either with the existing stocks of money or with additional credits. For the purpose of credit policy control by the central bank, however, only the granting of credit can be influenced. If instruments other than a credit ceiling are employed, the object is to regulate the liquid funds of the banks. The amount of that liquidity balance is governed by market factors on the action of which the central bank can exert no direct influence. The liquid funds are held by the banks in various forms of liquid assets for the purpose of granting credit and preserving their solvency. Credit policy can either regulate directly the range of assets classified as liquid funds, or merely the use of the liquidity balance.

An indicator and control standard are obtained for the liquidity balance with the aid of an analysis of money flows. In this instance a weekly analysis of money flows for the Federal Republic of Germany for the period from 1952 to 1974 was taken as a basis. It transpires, for example, that the cash in circulation and the public cash transactions with the Bundesbank show regularly recurrent movements, which lead to disturbances of the money market. The foreign business of the central bank as a third market factor shows the strong influence on liquidity emanating from international goods and capital movements. Adjustment of liquidity balances was effected for the most part via the reserves held by the banks. The money market investments were of only slight significance in comparison.

The established continuous alternation of liquidity inflows and outflows not only subjected the money markets to alternating hot and cold baths, but also had a disturbing effect en the cyclical trend. If it is desired to eliminate these disturbing influences, the liquidity trend must be made more constant with the aid of credit policy. An instrument that is particularly suitable for this purpose is minimum reserve policy, the use of which permits short-term counteraction of liquidity fluctuations by making allowances for seasonal factors. Over and above this, greater use should be made of instruments which can directly regulate the amount of bank liquidity.


Blümle, Georg
"On the Theory of Saving in a Growing Economy"

To summarize what I consider the important conclusions from my deliberations:

1. Saving in most households, namely the low-income households, consists almost exclusively in saving for consumption purposes, saving for a security reserve and saving for an owner-occupied home.

2. This form of saving is not really directly oriented to creation of wealth in the sense of a participation in productive assets and therefore does not aim primarily at returns from assets. Hence the interest rate can by no means be ascribed the often assumed great importance for the amount of savings; moreover, even saving at a negative real interest rate can be demonstrated to be rational.

3. More uniform distribution of wealth cannot be expected from such saving, since the real purpose is not accumulation of wealth and in Addition there is neither the possibility nor the prime intention of realizing high yields.

4. The actual determinant of this form of saving is the decision of the individual household on what it believes it can, or must, provide for itself. Hence this form of saving is governed essentially by the amount of real disposable income.

5. In accordance with the relative income hypothesis, the described approaches can prove the long-term constancy of the average propensities to consume and save, and explain the difference from the short-term consumption function.

6. The interest rate for money and the rate of price increases constitute certain constraints which, depending on income, make saving impossible beyond a certain threshold. The resulting decline in saving from certain inflation rate onwards should not be imputed to impaired trust in the currency, which would necessarily lead up to a cumulative process.

7. Within certain limits it can be assumed that the saving explained here increases as the real interest rate declines, so that an expected higher inflation rate results in more and an expected Iower inflation rate in loss saving, and that an expected inflation rate thus stabilizes itself.


Großeschmidt, Brita
"The Cyclically Neutral Budget as an Element of an Economic policy Conception"

If the conception of a cyclically neutral budget advanced by the Council of Experts is considered in conjunction with the medium-range orientation of behaviour propagated by the Council of Experts, it assumes the character of an "educational" model intended to persuade public authorities to orient selection of stabilization policy measures to their long-range allocation objectives. The revelation of this interconnection of necessary short-term action and long-range objectives might, in its turn, set an example for a reorientation of modes of behaviour of other groups participating in the economic process. Where stability problems are essentially a result of distribution conflicts and the latter emanate from group behaviour that reacts to market signals, breaking away from market signals by way of medium-term interpretation of group goals might facilitate the task of stabilization policy and enhance the chances of attainment of longer-range objectives of public authorities. In this sense, too, the concept of a cyclically neutral budget would be an 'educational' model.

A reorientation of the modes of behaviour of the autonomous groups is possible, however, only if the divergences in long-range objectives can be reconciled with each other at a level other than that of wage conflict. However, the plane of redistribution of wealth increments proposed by the Council of Experts is a dubious equivalent of wage conflict: what is necessary is rather a bundle of substitution strategies aimed at a change in scope. If no such bundle is available, there is no basis for a medium-range orientation of behaviour. On the other hand, the less the autonomous groups relieve public authorities of the task of stabilization policy, the smaller are the chances of interlinking necessary short-term action with long-range objectives in the public sector.



Ahrens, Gerhard
"The Struggle for a Central Bank in Hamburg in the Middle of the 19th Century"

The basic prerequisite for the development of Germany's economic power in the middle of the 19th century was the existence of an efficient capital market organization. That there was a lack, everywhere of suitable institutions which could form a reservoir of risk capital and make it available for economic expansion was to no small extent the consequence of government banking policy. For it was attributable above all to the reserved attitude of official agencies to corporate forms of enterprise that the "association of monetary forces" only made moderate progress.

The call for "banking freedom" in the sense of private initiative without government intervention therefore became a central demand of the liberal economic policy clashed with each other, is the project for setting up a for the building up of the monetary and credit system in keeping with the times, in which fundamentally, different conceptions of economic theory and economic policy clashed with each other, is the project for setting up a "Disconto-Bank" in Hamburg in 1845. The violent controversies among the merchants, the political -leadership of the city state and an evermore influential public opinion regarding the establishment of this banking institution are the subject of this study.

On the one hand, far-sighted merchants wanted the benefits of a central bank, of which there were still only a few in the whole of Germany, to accelerate the circulation of money in the leading trading city on the continent. On the other hand, however, there was the pride in the supposedly unsurpassable "Girobank" dating from 1619, and a widespread antipathy to joint stock undertakings and the related exclusion of liability and depersonalisation. In addition, the Senate was opposed on principle to any issue of bank notes, which was regarded as a violation of the coinage prerogative which was reserved for the state alone. - The meagre results of the public subscription for shares destroyed all high expectations. Only then did the founders abstain from setting up the controversial joint-stock bank. In spite of all the optimistic agitation, it proved that capitalistic thought and action had not yet grown sufficiently strong roots in Hamburg's' economic life.