Appeal No. 2005-2642
Reexamination Control No. 90/005,841
H. The Mukherjee and Musmanno references
Mukherjee describes the Finnish experience with inflation-indexing in various
areas, including bank deposit accounts (at 50-56), government- and industry-issued
bonds (at 57-63), social security, pensions, and insurance (at 63-66), bank loans (at
67-69), and commercial and property contracts (at 70-73).
The Finnish banking system was divided into three groups: (a) commercial
savings; (b) cooperative; and (c) Post Office. Mukherjee at 50, 1st para. “As the
rapid inflation of 1950-1 was being checked by the stabilisation programme begun in
October 1951, the banks took the decision, in principle, to adjust both their loans and
deposits for inflation, on the basis of quarterly inspections of the cost-of-living index.”
Id. at 50, second para. While “[t]he initial idea had been to apply an extra charge to all
loans equal to half the rise in the index, and then to use the funds to compensate all
depositors for half their loss due to inflation,” id. at 50, 4th para., that initial idea was not
adopted. Instead,
[w]hat was eventually decided was different and more complex. Not all
deposits were index-linked, but only specifically designated accounts
carrying certain restrictions on withdrawal. Full inflation proofing was
given to these designated accounts. The money needed to make them
keep pace with the cost of living was found by imposing an ‘index
surcharge’ on all loans. The amount of the surcharge was usually fixed
according to the proportion of the bank’s deposits benefiting by index
adjustment, so that the bank could just balance its commitments.
Id. at 50-51. The first index-linked bank deposit accounts went into effect in May 1955
and had the following characteristics:
(1) A lump sum of 30,000 markka was required to open the account;
14
Page: Previous 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 Next
Last modified: November 3, 2007