One system of subsidy, therefore, involved German exporters using their foreign earnings to buy up the heavily discounted German bonds in London and New York. A bond with a face value of $100 (valued at 350 Reichsmarks, at the prevailing exchange rate of 3.50 Reichsmarks to the dollar) could be purchased in New York in April 1934 for roughly $50 (175 Reichsmarks, at the going rate). With the German exporter now holding the discounted IOU, a debt owed by a German debtor to a foreign creditor had been converted into a debt owed by one German to another.
