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² See Eichengreen, Barry, Golden Fetters: The Gold Standard and the Great Depression, 1919–1939 (New York and Oxford: Oxford University Press, 1992), 220Google Scholar; Kindleberger, Charles P., The World in Depression, 1929–1939, rev. ed. (Berkeley: University of California Press, 1986), 157 n. 53, 297.Google Scholar

³ Clarke, , Cooperation, 16–17, 42, 221.Google Scholar

⁴ Eichengreen, , Golden Fetters, 259.Google Scholar

⁵ A point made many times; see Clarke, , Cooperation, 27–8Google Scholar; Eichengreen, Barry, ‘Central Bank Cooperation under the Interwar Gold Standard’, Explorations in Economic History, no. 21 (1984), 66–7Google Scholar; Dam, Kenneth W., The Rules of the Game: Reform and Evolution in the International Monetary System (Chicago: University of Chicago Press, 1982), 51–2.Google Scholar

⁶ Eichengreen, , Golden Fetters, 9–11, 30–2, 65–6.Google Scholar

⁷ For such instances of central banks acting as international lenders-of-last-resort, see Kindleberger, Charles P., Manias, Panics, and Crashes: A History of Financial Crises (New York: Basic Books, 1978), 182–92CrossRefGoogle Scholar; and idem, A Financial History of Western Europe (London: George Allen & Unwin, 1984), 280–3.

⁸ See Kindleberger, , Manias, Panics, and Crashes, 188–9Google Scholar; idem, Financial History, 281–2.

⁹ The Bank of France had used an inexperienced intermediary (the Comptoir d'Escompte rather than Rothschilds) to draw gold from London. The Comptoir took too much gold directly from the Bank of England, leading to an abrupt rise in Bank rate; the Bank of France sent an emissary directly to the Bank of England to ease the resulting strains. Plessis, Alain, La Politique de la Banque de France de 1851 à 1870 (Geneva: Librairie Droz, 1985), 241–5.Google Scholar

¹⁰ Governor Lidderdale then negotiated with Rothschilds; he sent a letter to the Governor of the Bank of France once the loan had been arranged. SirClapham, John, The Bank of England: A History (Cambridge: Cambridge University Press, 1945), ii. 328–9, 336.Google Scholar

¹¹ Sayers, R. S., The Bank of England, 1891–1944 (Cambridge: Cambridge University Press, 1976), i. 55–6, 59.Google Scholar

¹² Kindleberger, , Financial History, 282.Google Scholar

¹³ Patron, Maurice, The Bank of France and Its Relation to National and International Credit (Washington: Government Printing Office, 1910), 147.Google Scholar

¹⁴ He also wished to promote development of an international acceptance market in New York. See Benjamin Strong to R. H. Treman, 2 Jan. 1917, 320.22.2 (1), Strong Papers, Central Records Office of the Federal Reserve Bank of New York, New York.Google Scholar

¹⁵ Strong to Treman, 2 Jan. 1917, 320.22.2 (1), Strong Papers, and Strong diary of trip to Europe, 1000.2, Strong Papers. Strong wished to take advantage of an openness he attributed to the war and to British and French reliance on American lending and war material. He wrote to Charles Hamlin that the situation regarding foreign correspondents, ‘better than any other in my experience illustrates the truth of the saying that a man with money is always popular’. Strong to Hamlin, 17 Jan. 1917, 210.1 (1), Strong Papers. On Federal Reserve relations with Europe, see Soutou, Georges-Henri, L'or et le sang: Les buts de guerre économiques de la Première Guerre mondiale (Paris: Fayard, 1989), 120–7, 342–53.Google Scholar

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¹⁷ ‘Memorandum of conversations’, 30 Mar. 1916, 210.1 (1), Strong PapersGoogle Scholar. The Board's announcement was intended to make up for an injudicious public warning against the purchase of Allied government paper in Nov. 1916, which had sparked rumours of German sympathies on the Board.

¹⁸ Strong diary entries for 28 and 30 Mar. 1916 (quote from latter), 1000.2, Strong PapersGoogle Scholar. They were particularly concerned that the French government, as well as the Bank of France, guarantee that gold would be shipped as agreed between the banks.

¹⁹ He was concerned that opposition from Adolph Miller and the new members on the Board would render conclusion of an agreement with the Bank of France difficult. Strong to Jay, 22 June 1921, 320.114 (1), Strong PapersGoogle Scholar. See also Crane, J. E. for Harrison, 27 Sept. 1926, C261.1, France, Bank of France 1919–1926, FRBNY.Google Scholar

²⁰ Chandler, Lester W., Benjamin Strong, Central Banker (Washington, DC: The Brookings Institution, 1958), 258–61Google Scholar; Sayers, , Bank of England, i. 154–6Google Scholar; Eichengreen, , Golden Fetters, 209Google Scholar; Boyce, Robert W. D., British Capitalism at the Crossroads, 1919–1932: A Study in Politics, Economics and International Relations (Cambridge: Cambridge University Press, 1987), 160, 412 n. 101Google Scholar; The Economist, 22 Dec. 1990, 113–15.

²¹ R. G. Hawtrey claimed that while some gold would be needed for reserves in the gold centres, if the convention was global and if all gold-standard countries adhered to it, gold would nowhere be needed as a means of remittance. ‘The Genoa Resolutions on Currency’, rep. in idem, Monetary Reconstruction 2nd ed. (London: Longmans, Green and Co, 1926), 127.

²² The report of the Financial Commission is reproduced in the Federal Reserve Bulletin (June 1922), 678–80. See also Clarke, Stephen V. O., ‘The Reconstruction of the International Monetary System: The Attempts of 1922 and 1933’, Princeton Studies in International Finance, no. 33 (Princeton: International Finance Section, 1973), 11–14Google Scholar; Sayers, , Bank of England, i. 153–63Google Scholar; SirClay, Henry, Lord Norman (London: Macmillan, 1957), 135–8Google Scholar; and Boyce, , British Capitalism, 39–41.Google Scholar

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²⁴ ‘Resolutions proposed for adoption by the central and reserve banks represented at meetings to be held at the Bank of England’, Sayers, , Bank of England, iii. 75Google Scholar. An early draft sought to deny status as central banks to those banks that were not sufficiently autonomous, and to deprive them of the right to demand co-operation with other central banks; ‘Resolutions’, 1116.3 (3), Strong Papers.

²⁵ ‘Resolutions proposed for adoption by the Governors or Presidents of Central Banks at Meetings to be held at the Bank of England,June, 1922’,1116.3 (3), Strong Papers.Google Scholar

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²⁸ Eichengreen, , Golden Fetters, 188–91, Table 7.1.Google Scholar

²⁹ R. G. Hawtrey, ‘The Gold Standard and the “Rules of the Game"’, 17 Oct. 1931, T 188/28, Treasury Papers, Public Record Office, London.

³⁰ Strong's most vehement statement to this effect came in response to the idea of a central bankers' meeting to discuss the gold problem in 1928, in O. E. Moore, ‘Memorandum of Conversation with Sir Arthur Salter’, 1000.9, Strong Papers; similar views were expressed with greater moderation in his correspondence with Norman in 1922 and 1925. See also Clarke, , Cooperation, 39–41Google Scholar; Chandler, , Benjamin Strong, 278–81.Google Scholar

³¹ Norman to Strong, 15 Apr. 1925, elaborating a suggestion put forward by cable on 21 Mar. Norman wished to invite those bankers with whom he had developed positive relations: Strong, Moll, Vissering and Schacht. Norman to Strong, 11 May 1925, 1116.5 (2), Strong Papers.Google Scholar

³² Strong to Norman, 27 Apr. 1925, 1116.5 (1), Strong Papers.Google Scholar

³³ Norman to Strong, 11 May 1925, 1116.5 (2), Strong Papers.Google Scholar

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³⁷ Sayers notes that Norman went ‘much further into international politics than the Bank of England could have expected to go’, and that ‘the episode provides an important example of the unreality of any rigid line between central banking and international politics’. Sayers, , Bank of England, i. 174, 180Google Scholar. On central bank involvement in the Dawes Plan see Clarke, , Cooperation, 45–70Google Scholar; Sayers, , Bank of England, i. 174–83Google Scholar; Clay, , Lord Norman, 194–217Google Scholar; Schuker, Stephen A., The End of French Predominance in Europe: The Financial Crisis of 1924 and the Adoption of the Dawes Plan (Chapel Hill: University of North Carolina Press, 1976), 300–18, 348–52.Google Scholar

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³⁹ Strong warned Pierre Jay in 1926 that French, Italian and probably Belgian bankers distrusted Norman, and that he had been ‘strongly advised both from inside and outside, that if we go ahead with participation in any stabilization plans in any of these three countries, we should not do it through Governor Norman as an intermediary’. Cited in Chandler, Benjamin Strong, 350. Moreau, Émile was highly suspicious of Norman; his diary as governor attests to the durability of his suspicions; Souvenirs d'un Gouverneur de la Banque de France: Histoire de la stabilisation du franc (1926–1928) (Paris: M.-Th. Génin, 1954)Google Scholar. As late as June 1928, Strong commented on the concern in political and banking circles ‘that Governor Norman desired to establish some sort of dictatorship over the central banks of Europe and that I was collaborating with him in such a program and supporting him’. Clay, , Lord Norman, 265.Google Scholar

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⁴¹ Siepmann, ‘Central Bank Co-operation’, 19 July 1943, G 14/33, BOE. The Section was dominated by Norman and responsibilities were not clearly drawn, leaving the way open for future confusion as to Bank policy, as happened in the handling of the Romanian stabilisation. On the peculiar status of Norman's advisers on central bank relations, which permitted Niemeyer and Siepmann to engage in unofficial conversations that could later be disavowed, see Sayers, , Bank of England, i. 200–1Google Scholar, and Strong, ‘Memorandum re Bank of England – Bank of France Relations’, 24 May 1928, 1000.9, Strong Papers.

⁴² Jean-Claude Debeir, ‘La Banque de France et la coopération monétaire internationale dans les années 1920’, in Fridenson, Patrick and Straus, André, eds, Le Capitalisme français, 19e–20e siècle: Blocages et dynamismes d'une croissance (Paris: Fayard, 1987), 280–1.Google Scholar

⁴³ Slightly different interpretations are given by Clarke, , Cooperation, 134–8Google Scholar, and Eichengreen, , Golden Fetters, 209–16.Google Scholar

⁴⁴ The shift was recognised at the time: N. D. Jay, ‘Memorandum’, 29 June 1926, J. P. Morgan & Co. Papers (thereafter JPM), The Pierpont Morgan Library, New York. See also Debeir, ‘Banque de France’, 278–80.Google Scholar

⁴⁵ Chandler, , Benjamin Strong, 367–72Google Scholar, and Kenneth Mouré, ‘Poincaré’s Burning House: Planning, Politics and Policy in the Stabilization of the Franc, 1926–1928', paper presented to the Berkeley Economic History Workshop, 12 Feb. 1991.

⁴⁶ Moreau to Strong, 1 Mar. 1927, 1125.3, Strong Papers.Google Scholar

⁴⁷ Moreau to Strong, 16 and 17 May 1927, and Moreau to Norman, 16 and 18 May 1927, AN 374 AP 6, Archivs Nationales, Paris.Google Scholar

⁴⁸ Moreau, , Souvenirs, 293–4, 296, 305, and esp. 306.Google Scholar

⁴⁹ Moreau suspected that a drop in Bank rate in mid-April was ‘bluff; Souvenirs, 288. Quesnay was certain that this reduction was unwarranted and blamed it for the surge in foreign exchange arriving in Paris; J. A. M. de Sanchez, ‘Memorandum for Mr. T. W. Lamont’, sent with Sanchez to Lamont, 18 July 1927, France's Financial and Political Situation file, JPM.Google Scholar

⁵⁰ Moreau, , Souvenirs, 310, 312.Google Scholar

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⁵² Charles Rist, ‘Aide mémoire des conversations du 29 et 30 Juin entre M. Rist, M. Strong et M. Harrison’, 1 July 1927, AN 374 AP 6. As Russell Leffingwell commented, any attempt by the French to make money dearer in New York was bound to fail unless Strong wished it to succeed; Russell C. Leffingwell memorandum for Thomas W. Lamont, 24 June 1927, JPM.Google Scholar

⁵³ Moreau, , Souvenirs, 317–18Google Scholar; Moreau to Norman, 21 May 1927, AN 374 AP 6; and Siepmann, ‘Note on conversations in Paris, May 20/21, 1927’, G 1/34, BOE.Google Scholar

⁵⁴ For Moreau, use of his sterling and dollar balances to tighten credit in London, forcing London to act in turn on Amsterdam and Berlin, was the ‘gold standard’ solution to the problem. For Norman, the problem lay unmistakably in Paris, where high interest rates, low security prices and the prospect of an appreciation of the franc made Paris ‘irresistible’ to short-term funds. De jure stabilisation was the obvious remedy, but Moreau declared this politically impossible. Moreau, , Souvenirs, 324–6Google Scholar, and Siepmann, ‘Note of a conversation in Paris on Friday 27th May, 1927’, G 1/34, BOE. Strong recommended similar measures in Strong to Moreau, cable no. 15, received 27 May 1927, AN 374 AP 6.

⁵⁵ Siepmann, ‘Note of conversations with Monsieur Quesnay in London on the 1st, 2nd and 3rd June, 1927’, G 1/34, BOE, and Siepmann to Quesnay, 4 June 1927, AN 374 AP 6.Google Scholar

⁵⁶ See Moreau, , Souvenirs, 357–8, 371, 373, 389, 394Google Scholar. Kindleberger has noted the dual advantage of these swaps in relieving fears of inflation in France while disguising the ownership of French balances in London; Kindleberger, Financial History, 359. There was a third advantage: the growth in the foreign exchange holdings of the Bank of France was checked, alleviating political pressure for revalorisation.

⁵⁷ Although Eichengreen suggests that dissatisfaction with the arrangements between Moreau and Norman prompted this meeting ('Central Bank Cooperation', 81), Norman and Moreau seem to have been satisfied with the results of their co-operative approach. Moreau's invitation was linked to his actions in May, which required that the Bank of France be included if such meetings between the key central bankers were to be co-operative rather than conspiratorial; see Strong to George L. Harrison, 27 July 1928, 1000.9, Strong Papers. Strong warned Moreau in May that Norman and/or Schacht might come to New York, and he checked with Norman and Schacht before extending an invitation to Moreau on 9 June to join them.

⁵⁸ Sayers, , Bank of England, i. 338–9Google Scholar; Rist, Charles, ‘Notice biographique’, Revue d'Économie Politique, Vol. 65 (1955), 1006, and Strong to Harrison, 27 July 1928, 1000.9, Strong Papers.Google Scholar

⁵⁹ Clarke, , Cooperation, 123–34Google Scholar; Sayers, , Bank of England, i. 341–3Google Scholar; Chandler, , Benjamin Strong, 374–8Google Scholar; Moreau, , Souvenirs, 367–8, 372Google Scholar; Eichengreen, , Golden Fetters, 212–14.Google Scholar

⁶⁰ Rist, ‘Aide mémoire des conversations du 29 et 30 Juin entre M. Rist, M. Strong et M. Harrison’, 1 July 1927, AN 374 AP 6; also Moreau, , Souvenirs, 372.Google Scholar

⁶¹ From Norman's manuscript notes reproduced in Sayers, , Bank of England, iii. 96–100Google Scholar. See also his gloomy note, Norman to Strong, 25 July 1927, 1116.7 (2), Strong Papers.Google Scholar

⁶² Siepmann summation of Quesnay views in ‘Monsieur Quesnay on the Gold Exchange Standard’, 22 Sept. 1927, OV 48/1, BOE.Google Scholar

⁶³ Rueff, Jacques, ‘Défense et illustration de l’étalon or', lecture at the École Libre des Sciences Politiques, 17 Mar. 1932, reprGoogle Scholar. most recently in idem, Oeuvres Complètes, Vol. 3, no. 2 (Paris: Plon, 1980), 105–27; and idem, ‘Sur les causes et les enseignements de la crise financière anglaise’, I Oct. 1931, repr. in idem, De l'aube au crépuscule (Paris: Plon, 1977), 299–320. See also Kooker, Judith L., ‘French Financial Diplomacy: The Interwar Years’, in Rowland, Benjamin M., ed., Balance of Power or Hegemony: The Interwar Monetary System (New York: New York University Press, 1976), 86–90.Google Scholar

⁶⁴ See Jean Bouvier, ‘A propos de la stratégic d'encaisse (or et devises) de la Banque de France de juin 1928 à l'été 1932’, in idem; L'historien sur son métier: Études économiques XIXe–XXe siècles (Paris: Editions des archives contemporaines, 1989), 347–67.

⁶⁵ Clarke, , Cooperation, 36–40, 135–6.Google Scholar

⁶⁶ See Strong's correspondence with FRBNY statistician Carl Snyder, especially 27 Feb. 1927, 320.45.6 (1), Strong Papers; also Strong to Pierre Jay, 26 Mar. 1927, 1012.3 (1), Strong Papers.Google Scholar

⁶⁷ See Strong to Norman, 19 Sept. 1927, 1116.7 (1), Strong Papers, and Strong to Norman, 27 Mar. 1928, 1116.8 (1), Strong Papers, and the development of his opposition to the gold-exchange standard in Strong to Owen D. Young, 11 June 1928, 1000.9, Strong Papers.Google Scholar

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⁶⁹ Strong to Jay, 4 Aug. 1927, 1012.3 (1), Strong Papers.Google Scholar

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⁷¹ Strong to Norman, 9 and 31 Aug., 21 Sept., 19 Oct. and 9 Nov. 1927, 1116.7 (1), Strong Papers.Google Scholar

⁷² ‘How can such a situation as the present one be met by any scheme or device, automatic or mechanical? Must it not be dealt with by this species of management and cooperation such as we have been attempting to give it … [?]’ Strong to Norman, 19 Oct. 1927, 1116.7 (1), Strong Papers.Google Scholar

⁷³ Moreau, , Souvenirs, 600–1Google Scholar; and Strong to Stewart, 20 July 1928, 1117.2 (1), Strong Papers, in which Strong reported that Schacht, Vissering, Bachman and Franck opposed a League enquiry and that he hoped Norman's opposition would bring the League efforts to a halt.Google Scholar

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⁷⁶ Moore, , ‘Memorandum of Conversation’, 1000.9, Strong Papers.Google Scholar

⁷⁷ Strong to Owen D. Young, 11 June 1928, 1000.9, Strong Papers; Strong's views to this point are quoted in Clarke, Cooperation, 39.Google Scholar

⁷⁸ Strong to Young, 11 June 1928, 1000.9, Strong Papers.Google Scholar

⁷⁹ ibid., postscript added 18 July 1928.

⁸⁰ Meyer, Bankers' Diplomacy, 100–37.Google Scholar

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⁸⁴ Clarke, , Cooperation, 151–9Google Scholar; Chandler, , Benjamin Strong, 463–70Google Scholar; Chandler, Lester V., American Monetary Policy, 1928–1941 (New York: Harper & Row, 1971)Google Scholar, esp. 89 on the role of leadership; and Wicker, Federal Reserve. Elmus, R.Monetary Policy, 1917–1933 (New York: Random House, 1966), 129–43.Google Scholar Eichengreen attaches great significance to the weaker relationship between Harrison and Norman, Golden Fetters, 209, 220; Harrison's relatively weak authority as governor of the FRBNY seems more important than the degree of personal friendships between the governors. Siepmann noted in a review in 1943 of central bank co-operation, ‘When Ben Strong died in October 1928, his mantle fell upon George Harrison and the institutional relationship survived, until it was severed by intervention of the U.S. Treasury. This showed that continuity was not sacrificed by starting on a personal footing.’ Siepmann, ‘Central Bank Co-Operation’, G 14/33, BOE.

⁸⁵ The statutes are reproduced in an appendix to Paul, Einzig, The Bank for International Settlements (London: Macmillan, 1930), 160–79.Google Scholar

⁸⁶ Norman's appreciation of the Bank is evident in his testimony to the Macmillan Committee on 18 Feb. 1931, repr. in Sayers, , Bank of England, iii. 242–8Google Scholar. On the foundation and character of the BIS, see ibid., i. 352–9, and Roger, Auboin, ‘The Bank for International Settlements, 1930–1955’, Princeton Essays in International Finance (Princeton: International Finance Section, 1955), 1–7.Google Scholar

⁸⁷ Eichengreen, , Golden Fetters, 263–4.Google Scholar

⁸⁸ Kindleberger, , World in Depression, 144–7Google Scholar, and Clarke, , Cooperation, 186–8.Google Scholar

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⁹⁰ While the BIS loan to the Creditanstalt was approved by the Bank of France without reference to the French government, participation in BIS credits to the Reichsbank was made subject to governmental approval. See Délibérations du Conseil Général de la Banque de France (thereafter DCG), 21 May 1931, 24 June 1931, 9 and 18 July 1931, Banque de France, Paris.

⁹¹ On the essentially political nature of the crisis, see Schuker, Stephen A., ‘American “Reparations” to Germany, 1919–33: Implications for the Third-World Debt Crisis’, Princeton Studies in International Finance, No. 61 (Princeton: International Finance Section, 1988), 54–64.Google Scholar

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⁹³ See Sayers, , Bank of England, ii. 393–410Google Scholar; Kunz, Diane B., The Battle for Britain's Gold Standard in 1931 (London: Croom Helm, 1987)Google Scholar; and Boyce, , British Capitalism, 343–8.Google Scholar

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⁹⁸ Kindleberger, , World in Depression, 164–5Google Scholar; Mouré, , Franc Poincaré, 74–7.Google Scholar

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¹⁰⁴ Sayers, , Bank of England, ii. 458 and 465Google Scholar, and Howson, , Sterling's Managed Float, 36–7.Google Scholar

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¹⁰⁹ Diaries, Morgenthau (thereafter MD), Vol. vi, and account of events by Merle Cochran in MD vii. 73–95, Franklin D. Roosevelt Presidential Library, Hyde Park, New York. According to Cariguel, the American Treasury credit had saved the franc. Cochran to Morgenthau, 19 June 1935, MD vii. 88–9. Also Clarke, ‘Exchange-Rate Stabilization’, 9–10, 13.Google Scholar

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¹¹¹ Knoke-Cariguel telephone conversations recorded 15 Nov. to 10 Dec. 1935, C261.1, Bank of France 1935, FRBNY; Morgenthau conversations with Cochran, 5 and 12 June 1936, MD xxvi. 118D and 178; L. W. Knoke, ‘Facilities granted Bank of France by the Secretary of the Treasury’, 12 June 1936, C261.1, Bank of France 1936, FRBNY.

¹¹² St Pierre is the more populous of two French islands off the southern coast of Newfoundland. Morgenthau asked Jay Crane to pursue this through the Bank of France on 18 Jan., having had no luck pressing it through normal diplomatic channels; Crane memorandum, 18 Jan. 1935. When Morgenthau obtained satisfaction, Crane records, ‘He asked me to call Mr. Cariguel at the Bank of France and tell him that the Secretary was delighted to have the St. Pierre matter fixed up and was anxious to cooperate closely with the French. Secretary Morgenthau said that he wanted to develop close contacts with them, that the State Department agreed … and the Secretary wanted to forget about the British and play ball with the French.’ Crane record of telephone conversation with Morgenthau, 9 Apr. 1935, C261.1, Bank of France 1935, FRBNY.

¹¹³ Clarke, , ‘Exchange-Rate Stabilization’, 14, 19.Google Scholar

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