Lords of Finance: The Bankers Who Broke the World

by Liaquat Ahamed

Émile Moreau’s strategy of keeping the franc pegged at a low rate had meant that French goods remained attractively priced. As a result the economy held up very well in 1929 and 1930, and capital, in search of safety, started flooding into France: a total of $500 million of gold during 1930. It was one of the startling ironies of that whole period that France, viewed by bankers in the years after the war as irresponsible and suspect, had now become the world’s financial safe haven. By the end of 1930, the Banque de France, in addition to the $1 billion it held in sterling and dollar deposits, had accumulated a gold reserve mountain of over $2 billion, three times that of the Bank of England. French officials, who only a few years before had been quick to blame their woes on the work of international currency “speculators,” now began touting the superior wisdom of these selfsame “investors” for the votes of confidence they had cast on French economic management.