Under the Dawes Plan there was growing apprehension that Germany would not be able to continue borrowing the loans from which she had met all her payments to date. In addition the Dawes Plan had never mentioned a final figure for these payments, which were revisable, to be adjusted up or down according to an index of prosperity. German opinion required not only a reduction in the amount of reparations but the naming of a definite sum—the ‘final settlement’ advocated by Parker Gilbert, the Agent-General.

Accordingly in September 1928 a new committee of experts, including German representatives, was announced under the chairmanship of the American industrialist, Owen D. Young, who had been a member of the Dawes Committee. The Young Committee met for the first time in Paris on 9 February 1929. Among the experts were Sir Josiah Stamp and Lord Revelstoke (replaced on his death by Sir Charles Addis) who were the British members, J. P. Morgan and Thomas W. Lamont representing the United States, and Dr Schacht, accompanied by Melchior, as an adviser attending on behalf of Germany.

Keynes felt this conference had been called too soon, as may be seen in the following letter that he wrote to the editor of a New York financial information service. The article enclosed with his letter was ‘The Transfer Problem’, to be published in the March 1929 issue of the Economic Journal (JMK, vol. XII).