Lords of Finance
Page 54
58 Strong persuaded: “Gold Cruiser to Sail Today,” New York Times, August 6, 1914.
58 “Wherever he sat”: Chandler, Benjamin Strong, 48.
58 “Jekyll and Hyde personality”: Interviews with Leslie Rounds, Committee on the History of the Federal Reserve System, Washington: Brookings Institution, 1954-55
58 If the Aldrich Plan of a single central bank: Interviews with William McChesney Martin Sr., Committee on the History of the Federal Reserve System, Washington: Brookings Institution, 1954- 55.
59 The salary he would receive: “Bank Head’s Pay $30,000,” Chicago Daily Tribune, October 27, 1914.
59 “Ben is not going to live” : Federal Reserve Bank of New York, “Biography of Benjamin Strong by his Son, Benjamin Strong.” 1978
59 Only the year before: Details of Strong’s apartment at 903 Park Avenue from “The Real Estate Field,” New York Times, January 15, 1914.
5: L’INSPECTEUR DES FINANCES
61 “There isn’t a bourgeois alive”: Gustav Flaubert quote from Bartlett’s Familiar Quotations, 527
61 It was the latest in a long chain: Berenson, The Trial of Madame Caillaux, 2.
63 the École Libre des Sciences Politiques: Zeldin, French Passions: Intellect and Pride, 343.
64 His family, minor gentry: Dutron de Bornier from Pierre Lyautey, “Eloge de M. Moreau,” Comptes Rendus Mensuels de L’Académie des Sciences Coloniales, Séance du 15 Octobre 1954, Paris, 1954. Joseph Marie-François Moreau from “Leur Vacances,” Le Petit Parisien, September 4, 1927.
64 Although the examination system had made: Zeldin, French Passions: Ambition and Love, 118.
65 To be chef de cabinet: For role of cabinets ministériel, see Keiger, Raymond Poincaré, 34.
66 “increased abnormally”: Brogan, France Under the Republic, 128.
66 “moral collapse”: Moreau, The Golden Franc: Memoirs, 17-18.
67 Over the next eight years: Moreau’s career at Banque d’Algérie from Pierre Lyautey, “Eloge de M. Moreau,” Comptes Rendus Mensuels des L’Académie des Sciences Coloniales, Séance du 15 Octobre 1954, Paris, 1954.
68 When he thought back: Moreau, The Golden Franc: Memoirs,12.
68 It was there: Jacques Rueff. “Preface to the French Edition,” in Moreau, The Golden Franc: Memoirs, 2.
68 In any other year: Adam, Paris Sees It Through, 15.
68 “to keep it exciting”: “Leur Vacances,” Le Petit Parisien, September 4, 1927, and Giscard D’Estaing, Edmond, “Notice sue Emile Moreau,” Comptes Rendus Mensuels de L’Académie des Sciences Coloniales: Séance du 1 Decembre 1950, Paris, 1950.
69 “Brawls were now breaking”: Adam, Paris Sees It Through, 12-13.
69 At the first sign: “French Gold Famine,” Times, July 30, 1914.
69 That afternoon: Le Figaro, July 31, 1914
70 “All classes of society”: “Vanished Gold,” Times, August 1, 1914.
70 “immense and perilous duties,” “formidable test,” “calmness, vigilance, initiative,” and “all [his] authority”: “Circulaire Bleu” from the Banque de France, Le Patrimonie, 423.
71 An hour later: “Paris Has Given Up All Hope of Peace, ” New York Times, August 2, 1914.
71 Within days of the outbreak: Cronin, Paris on the Eve, 441-42, and Adam, Paris Sees It Through, 21.
71 The next day, a Sunday: Clarke, Paris Waits, 65-67, and “Un Avion Allemand Sur Paris,” Le Figaro, August 31, 1914.
71 Few people: Lucien Klotz, “Mes Souvenirs du Temps de Guerre,” Le Journal, December 14, 1922, and Gaston-Breton, Sauvez L’Or, 28.
6: MONEY GENERALS
73 “Endless money”: Cicero quote from Bartlett’s Familiar Quotations, 91.
73 “the amounts of coin”: Quoted in Blainey, The Causes of War, 215.
74 “unlimited issue of paper”: Charles A. Conant, “How Financial Europe Prepared for the Great War,” New York Times, August 30, 1914.
74 Sir Felix Schuster: Stone, World War One, 30.
74 “he was quite certain”: Ferguson, The Pity of War, 319, and Bell, Old Friends, 45.
74 That same month: Strachan, First World War, 816.
74 The Hungarian finance minister: Stone, World War One, 30.
75 By then the five major powers: “Fifty Billions Cost of War Up To Date.” New York Times, July 30, 1916.
79 “quiet serious men”: Bagehot, Lombard Street, 156.
79 “a shifting executive”: Bagehot, Lombard Street, 157.
80 An economist of the 1920s: Hawtrey, Art of Central Banking, 246-47.
81 “very, very considerable”: Cyril Asquith quoting Keynes in Jackson, The Oxford Book of Money, 46.
81 “take over the Bank”: Sayers, The Bank of England, 105.
81-82 “to accept my unreserved apology”: Sayers, The Bank of England, 107.
83 “There goes that queer-looking fish”: Boyle, Montagu Norman, 105.
84 “into the most holy recesses”: Brogan, France Under the Republic, 115.
85 The Banque opened its doors: Stephane Lausanne. “The Bank of France,” Banker, August 1926, 93.
86 “The Banque does not belong”: Valance, La Legende du Franc, 167.
86 Indeed, Caillaux made things: Gunther, Inside Europe, 145.
88 “Obedience and subordination”: Feldman, The Great Disorder, 795.
88 Convinced like everyone else: Hjalmar, Schacht. “Bemerkungen über die Art und Weise der vorassichtlichen Kriegsentschädgung Frankreichs an Deutschland,” August 26, 1914, in Bundesarchiv Koblenz, Nachlass Schacht, Nr. 1.
90 “insincere replies to the questions”: Mühlen, Schacht: Hitler’s Magician, 9.
90 But even Schacht: Testimony of Wilhelm Volcke on May 3, 1946, in Trial of Major War Criminals Before the International Military Tribunal.
90 Rumors circulated that he had embezzled: For example, the entry for “Schacht, Hjalmar Horace Greeley” in Current Biography 1944, 594-97, includes the following passage: “With the endorsement of the military government he issued several millions of counterfeited banknotes to pay for supplies bought from the Belgians but Berlin authorities became suspicious when he never accounted for the bulk of this money. Also accused of having seen to it that his banking connections profited from his knowledge of Government secrets. . . .”
94 On one occasion: “Vote for Trenches in Central Park over Protests,” New York Times, March 23, 1918.
94 To kick off another campaign: “Wilson to Make War Speech Here in Drive for Loan,” New York Times, September 26, 1918.
7: DEMENTED INSPIRATIONS
99 “Lenis was certainly right”: Keynes, Collected Writings: The Economic Consequences, 2: 148. In four years: Hardach, The First World War, 153.
100 By the end of the war: Ferguson, The Pity of War, 322-31.
102 “fate of Germany”: Schacht, My First Seventy-six Years, 158.
103 “hard . . . callous . . . and buttoned down”: Schacht, My First Seventy-six Years, 17.
103 “He managed to look”: Bonn, Wandering Scholar, 303.
104 “Nothing seems sacred”: Roberts, The House That Hitler Built, 182.
104 “He was a man”: Rauschning, Men of Chaos, 117.
104 “caused more trouble”: Macmillan, Peacemaker, 191.
105 “little more than a shot”: Lentin, Guilt at Versailles, 21.
106 “twenty million too many: Holborn, A History of Modern Germany, 566.
106 “the only Jew”: Macmillan, Peacemaker, 201.
107 “costly frontal attacks”: Taylor, English History, 74.
107 The great natural resources: Wolff, Through Two Decades, 261.
108 “unbearable, unrealizable, and unacceptable”: Eyck, A History of the Weimar Republic, 1: 98.
109 “You seem to forget”: Schacht, My First Seventy-six Years, 161-162.
110 “If Germany is to be”: Keynes, “Memorandum by the Treasury on the Indemnity Payable by the Enemy Powers for Reparations and Other Claims,” in Collected Writings
, 16: 375.
110 “the sharpest and clearest”: Russell, Autobiography, 1: 69.
110 “I evidently knew more”: Harrod, The Life of John Maynard Keynes, 121.
111 “an illustrated appendix”: Skidelsky, John Maynard Keynes: Hopes Betrayed 1883-1920, 177.
112 “I tried to get hold”: Keynes, “Letter from Basil Blackett,” in Collected Writings, 16: 3.
113 “greedy for work”: Skidelsky, John Maynard Keynes: Hopes Betrayed, 304.
113 His Bloomsbury friends: Bell, Old Friends: Personal Recollections, 48.
113 “With the utmost respect”: Harrod, The Life of John Maynard Keynes, 201.
113 But to the many other: Skidelsky et al., Three Great Economists, 232, and Harrod, The Life of John Maynard Keynes, 31.
113 He looked so very ordinary: Skidelsky et al., Three Great Economists, 231.
113 “I have always suffered”: Skidelsky, John Maynard Keynes: Hopes Betrayed, 67, 169.
113 “gay and whimsical,” “that gift of amusing”: Bell, Old Friends: Personal Recollections, 52, 60.
114 “probably means the disappearance”: Skidelsky, John Maynard Keynes: Hopes Betrayed, 346.
114 “a sense of impending”: Keynes, Collected Writings: The Economic Consequences, 2: 2-3.
114 “The battle is lost”: Keynes, “Letter to David Lloyd George,” June 5, 1919, in Collected Writings, 16: 469.
115 “dry in soul”: Keynes, Collected Writings: The Economic Consequences, 2: 20.
115 “his thought and his temperament”: Keynes, Collected Writings: The Economic Consequences, 2: 26.
115 “his mind . . . slow”: Keynes, Collected Writings: The Economic Consequences, 2: 27.
115 “with six or seven senses”: Keynes, Collected Writings: The Economic Consequences, 2: 26.
115 “rooted in nothing”: Keynes, “Lloyd George,” in Collected Writings, 10: 23-24.
115 “civilization under threat,” “men driven by”: Keynes, Collected Writings: The Economic Consequences, 2: 144.
116 “ought to have been”: Trachtenberg, Reparation in World Politics, 94.
116 “is to us the most important”: Schuker, End of French Predominance in Europe, 17.
117 “la politique des casinos”: Steiner, The Lights That Failed, 183.
117 “As far as I am concerned”: Howe, A World History, 152.
117 “France could not decide”: Garratt, What Has Happened, 161.
117 “vainglorious, quarrelsome”: Carlyle, 1870 letter to the Times quoted in Wilson, the Victorians , 345.
117 “the gratification of private”: Schuker, End of French Predominance in Europe, 17.
117 “I can’t bear him”: Adamthwaite, Grandeur and Misery, 75.
117 “uneasy vanity”: Collier, Germany and the Germans, 470.
118 The Germans responded: Martin, France and the Après Guerre, 75.
120 “Nothing like this”: Keynes, “Speculation in the Mark and Germany’s Balances Abroad,” in Manchester Guardian Commercial, September 28, 1922, in Collected Writings, 18: 49-50.
120 A visitor in the late 1920s: Kindleberger, A Financial History, 310-11.
120 “In the whole course”: d’Abernon, The Diary of an Ambassador, 2: 124.
121 “133 printing works”: Schacht, The Stabilization of the Mark, 105.
121 Basic necessities: “Berlin Now Shivering in Sudden Cold Wave,” New York Times, November 8, 1923.
122 German physicians: “Cipher Stroke a New Disease for Germans Figuring Marks.” New York Times, December 7, 1923.
122 “For a salary”: Cowley, Exile’s Return, 142.
123 “How wild anarchic”: Zweig, The World of Yesterday, 301.
124 During those days of violence: Habedank, Die Reichsbank, 34.
125 “whether one wished”: Warburg Archives, Jahresbericht 1923, 43, quoted in Ferguson, Paper and Iron, 9.
126 “The Reichsbank today”: Ferguson, When Money Dies, 169.
127 “No-one could anticipate”: D’Abernon communication to Foreign Office, quoted in Ferguson, When Money Dies, 169.
127 “It appears almost impossible”: d’Abernon, The Diary of an Ambassador, 2: 240.
128 “old style Prussian,” “permanent order”: Schacht, My First Seventy-six Years, 161.
128 “hell’s kitchen”: Schacht. My First Seventy-six Years, 177.
8: UNCLE SHYLOCK
132 “The principal danger”: Bank of England, letter from Strong to Norman, November 22, 1918.
132 “help to rebuild”: “Wilson Stirs Audience,” New York Times, September 28, 1918.
133 “The Family”: Bacevich, “Family Matters” and “Bachelor as Guest Is Sole Occupant of Exclusive Club,” Washington Post, August 22. 1926.
134 “pallid career”: Phillips, Ventures in Diplomacy, 6, quoted in Bacevich, “Family Matters,” 406.
135 “constructive policy”: Letter from Strong to Leffingwell, July 31, 1919, quoted in Chandler, Benjamin Strong, 144.
136 “in which [Sir Edward]”: Strong to James Brown, September 14, 1916, quoted in Roberts, “Benjamin Strong, the Federal Reserve.”
136 “that the Allies,” “been slight”: Letter from Strong to Leffingwell, July 25, 1919, quoted in Chandler, Benjamin Strong, 142.
136 “their hearts to rule”: Letter from Strong to Leffingwell, July 31, 1919, quoted in Chandler, Benjamin Strong, 143.
136 “In the useless slaughter”: Masterton, England After the War, 32-33.
137 “The consequences”: Steffens, Autobiography, 803.
138 “lack of leadership,” “people in authority”: Letter from Strong to Leffingwell, August 30, 1919, quoted in Chandler, Benjamin Strong, 145-46.
138 “desert Europe,” “prolonged disorder”: Letter from Strong to Leffingwell, August 30, 1919, quoted in Chandler, Benjamin Strong, 145-46.
139 “the most wonderful,” “the most gorgeous”: Bank of England, letter from Strong to Norman, March 1, 1920.
139 “Whenever you do come”: Bank of England, letter from Norman to Strong, December 3, 1920.
140 “makes the whole of Paris”: Nicolson, Peacemaking 1919, 330.
140 “top-hatted frock-coated”: Brendon, Eminent Edwardians, 115.
140 “Lord Balfour seems”: Quoted in Middlemas and Barnes, Baldwin, 133.
140 “In the Balfour Note”: Quoted in Rhodes, “The Image of Britain,” 196.
140 “Has America which but yesterday”: “Still Scolding America for Funding Bill,” New York Times, February 7, 1922.
140 “lay a tribute upon”: Garet, Garrett. “Shall Europe Pay Back Our Millions,” New York Times, November 26, 1922.
141 “to approach the discussion”: “British to Pay All, Ask a Square Deal, Debt Board Is Told”, New York Times, January 9, 1923.
142 “they seemed to understand”: Boyle, Montagu Norman, 156.
143 “merely sell wheat”: “Baldwin Says We Don’t Understand Situation on Debt,” New York Times, January 28, 1923.
143 “a hick”: Grigg, Prejudice and Judgment, 102.
143 “I should be the most cursed”: Blake, The Unknown Prime Minister, 492.
143 “in order to give them”: Keynes. “Letter to J. C. C. Davidson,” January 30, 1923, in Collected Writings, 8: 103.
144 As the decade went on: Edwin L. James, “Europe Scowls at Rich America,” New York Times, July 11, 1926; Frank H. Simonds, “Does Europe Hate the U.S. and Why?” American Review of Reviews, September 1926; “Uncle Shylock in Europe,” American Review of Reviews, January 1927.
145 “Mr. Montagu Collet Norman”: “The Mission to America,” Times, December 27, 1922.
145 “singularly gifted”: Charles Addis diary quoted in Kynaston, The City of London: Illusions of Gold, 64.
145 “He never made jokes”: George Booth quoted in Kynaston, The City of London: Illusions of Gold, 66.
146 His unorthodox appearance: Kynaston, The City of London: Illusions of Gold, 64-66; “The Governor of the Bank
of England,” the Strand Magazine, April 1939.
146 At some point: “Along the Highways of Finance,” New York Times, September 4, 1932.
147 Take a typical incident: “Bank of England Head May Be in Berlin,” New York Times, March 18, 1923; and “Bank of England Governor Settles Problem in Berlin,” Christian Science Monitor, March 17, 1923; and “France Against Mediation in Ruhr by Outside Power,” Washington Post, March 17, 1923.
147 “Mr. Norman’s dislike”: Winston. Churchill, “Montagu Norman,” Sunday Pictorial, September 20, 1931.
148 “poseur”: Vansittart, The Mist Procession, 301.
148 “sensation of being”: Letter from Norman to Caroline Brown, quoted in Boyle, Montagu Norman , 140.
148 “secretive, egotistic”: Williams, A Pattern of Rulers, 205.
148 “a brilliant neurotic”: Boyle, Montagu Norman, 129-30.
149 “delighted in appearing,” “those of an old”: Templewood, Nine Troubled Years, 78.
149 Still an Edwardian: Worsthorne, Democracy Needs Aristocracy, 26-28.
149 “Only lately have the countries”: Bank of England, letter from Norman to Strong, March 22, 1922.
149 “Anything in the nature”: Bank of England, letter from Strong to Norman, July 14, 1922. “Dear Strongy”: Bank of England, letter from Norman to Strong, May 24, 1922.
150 “Dear Old Man”: Bank of England, letter from Norman to Strong, March 27, 1923.
150 “Dear old [sic] Monty”: Bank of England, letter from Strong to Norman, May 1, 1927.
150 “You are a dear”: Bank of England, letter from Strong to Norman, May 1, 1927.
150 “Dear Ben.”: Bank of England, letter from Norman to Strong, January 24, 1925.
151 they sounded like a couple of: Bank of England, letter from Norman to Strong, April 2, 1927, and letters from Strong to Norman, March 25, 1927, and April 14, 1927.
151 “Let me beg you”: Bank of England, letter from Norman to Strong, September 15, 1921.
151 “what is happening”: Bank of England, letters from Norman to Strong, March 21. 1925, and February 26, 1927.
151 “To have a sympathetic person”: Bank of England, letter from Strong to Norman, February 15, 1927.
151 “the Civilization”: Bank of England, letter from Norman to Strong, December 18, 1921.
152 “The black spot of Europe”: Bank of England, letter from Norman to Strong, April 9, 1923.