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“Quis Custodiet Ipsos Custodes?” The Federal Reserve System's Founding Fathers and Allied Finances in the First World War

Published online by Cambridge University Press:  13 December 2011

Priscilla Roberts
Priscilla Roberts
Affiliation:
PRISCILLA ROBERTS teaches American history at the University of Hong Kong and is director of the University's Centre of American Studies.
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Abstract

The First World War presented the newly formed Federal Reserve System with issues that were crucial in defining its future institutional character and operational strategies and priorities. From 1914 to 1917 disputes over the relationship between the U.S. and belligerent European nations divided competing groups of New York bankers who had helped to create the Federal Reserve System and who otherwise shared many of the same objectives for its future purpose and functions. These divisions grew particularly acrimonious over policies concerning acceptances, a new financial instrument that could substantially affect the Allied powers' ability to obtain war funding in the United States. Despite these wartime splits, the rival financial groups, led by Benjamin Strong and Paul M. Warburg, generally concurred in assigning a higher priority to the international implications of Federal Reserve policies than to domestic consequences. Likewise, after the war both united in using the Federal Reserve System to facilitate Europe's economic recovery.

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Articles
Information
Business History Review , Volume 72 , Issue 4: The Sales Strategy of the National Cash Register Company , Winter 1998 , pp. 585 - 620
Copyright
Copyright © The President and Fellows of Harvard College 1998

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References

1 Chandler, Lester V., Benjamin Strong: Central Banker (Washington, D.C., 1958), 32Google Scholar; Warburg, Paul M., “The Discount System in Europe,” prepared for the National Monetary Commission in 1910, and “Circulating Credits and Bank Acceptances,” address, Nov. 1911, both reprinted in Proceedings of the Academy of Political Science 4 (July 1914): 129–72Google Scholar; Broz, J. Lawrence, The International Origins of the Federal Reserve System (Ithaca, N.Y., 1997Google Scholar), chs. 4-5; Kaufman, Burton I., Efficiency and Expansion: Foreign Trade Organization in the Wilson Administration, 1913-1921 (Westport, Conn., 1974), 74–76Google Scholar; Parrini, Carl P., Heir to Empire: United States Economic Diplomacy, 1916-1923 (Pittsburgh, 1969), 22-23, 103–04Google Scholar; Phelps, Clyde William, The Foreign Expansion of American Banks: American Branch Banking Abroad (New York, 1927), 104–11Google Scholar; Abrahams, Paul P., “The Foreign Expansion of American Finance and Its Relationship to the Foreign Economic Policies of the United States” (Ph.D. diss., University of Wisconsin, 1967), 4–19Google Scholar.

2 On the Morgan firm's wartime financial activities, see “Memorandum Relative to Financing by J. P. Morgan & Co. during the World War,” no date, File 213-7, Thomas W. Lamont Papers, Baker Library, Harvard Business School, Boston, Mass.; Burk, Kathleen, Britain, America, and the Sinews of War, 1914-1918 (Boston, 1985Google Scholar), chs. 1-5, and Morgan Grenfell 1838-1988: The Biography of a Merchant Bank (Oxford, 1989), 103–34Google Scholar; Carosso, Vincent P., Investment Banking in America: A History (Cambridge, Mass., 1970), 204–07Google Scholar; Chernow, Ron, The House of Morgan: An American Banking Dynasty and the Rise of Modern Finance (New York, 1990Google Scholar), ch. 10; Lamont, Edward M., Ambassador from Wall Street: The Story of Thomas W. Lamont, J. P. Morgan's Chief Executive (Lanham, Md., 1994), 67–85Google Scholar; Nicolson, Harold, Dwight Morrow (New York, 1935), 172–93Google Scholar; Roberts, Priscilla Mary, “The American ‘Eastern Establishment’ and World War I: The Emergence of a Foreign Policy Tradition” (Ph.d. diss., Cambridge University, 1981), 247–61Google Scholar.

3 The fullest account of Federal Reserve policies on Allied war financing and in particular of the crucial acceptance policies, which covers the second half of 1915 and 1916, is Abrahams, “Foreign Expansion of American Finance,” 61-75. Brief accounts dealing with the issue in 1915 are given in Link, Arthur S., Wilson: The Struggle for Neutrality 1914-1915 (Princeton, N.J., 1960), 619 n. 86Google Scholar; Devlin, Patrick, Too Proud to Fight: Woodrow Wilson's Neutrality (New York, 1975), 355–56Google Scholar; Peterson, H. C., Propaganda for War: The Campaign Against American Neutrality (Norman, Okla., 1939), 93–94Google Scholar. Cooper, John Milton Jr., “The Command of Gold Reversed: American Loans to Britain, 1915-1917,” Pacific Historical Review 45 (May 1976): 215, 222CrossRefGoogle Scholar, deals briefly with acceptances in both 1915 and 1916. The culminating crisis of Nov. 1916 has, by contrast, received extensive historical attention; see references in note 89 below.

4 Broz, International Origins, ch. 5; Link, Arthur S., Wilson: The New Frontier (Princeton, N.J., 1956), 199–240Google Scholar; Wiebe, Robert H., Businessmen and Reform: A Study of the Progressive Movement (Cambridge, Mass., 1962), 72-79, 129–37Google Scholar; Kolko, Gabriel, The Triumph of Conservatism: A Reinterpretation of American History, 1900-1916 (New York, 1963), 156-58, 181-89, 217–54Google Scholar; Livingston, James, Origins of the Federal Reserve System: Money, Class, and Corporate Capitalism, 1890-1913 (Ithaca, N.Y., 1986Google Scholar); West, Robert Craig, Banking Reform and the Federal Reserve 1863-1923 (Ithaca, N.Y., 1977), chs. 1-8Google Scholar; Rothbard, Murray N., “The Federal Reserve as a Cartelization Device: The Early Years, 1913-1930,” in Money in Crisis: The Federal Reserve, the Economy, and Monetary Reform, ed. Siegel, Barry N. (Cambridge, Mass., 1984), 89–106Google Scholar; Greider, William, Secrets of the Temple: How the Federal Reserve Runs the Country (New York, 1987), 280–81Google Scholar.

5 Besides the works cited in the previous notes, see the accounts given in Warburg, Paul M., The Federal Reserve System: Its Origins and Growth—Reflections and Recollections, 2 vols. (New York, 1930), vol. 1Google Scholar; Chernow, Ron, The Warburgs: The Twentieth-Century Odyssey of a Remarkable Jewish Family (New York, 1993Google Scholar); Lamont, Thomas W., Davison, Henry P.: The Record of a Useful Life (New York, 1933), 92–103Google Scholar; Frank A. Vanderlip with Sparkes, Boyden, From Farm Boy to Financier (New York, 1935), 210–19Google Scholar.

6 On this broad outlook see Schiesl, Martin J., The Politics of Efficiency: Municipal Administration and Reform in America: 1880-1920 (Berkeley, Calif., 1977), 39–50Google Scholar; Haber, Samuel, Efficiency and Uplift: Scientific Management in the Progressive Era, 1890-1920 (Chicago, 1964), 101–07Google Scholar; Persons, Stow, The Decline of American Gentility (New York, 1973), 169–73Google Scholar; Sproat, John G., The “Best Men”: Liberal Reformers in the Gilded Age (New York, 1968), 257–71Google Scholar; Wiebe, Businessmen and Reform, 9-10; Hays, Samuel P., Conservation and the Gospel of Efficiency: The Progressive Conservation Movement 1890-1920 (Cambridge, Mass., 1959), 3-4, 256–66Google Scholar; Weinstein, James, The Corporate Ideal in the Liberal State, 1900-1918 (Boston, 1968), ch. 4Google Scholar.

7 Warburg, , “A United Reserve Bank of the United States” and “Principles That Must Underlie Monetary Reform in the United States,” Proceedings of the Academy of Political Science 1 (Jan. 1911): 302, 304, 382, 386, 475–76Google Scholar; Warburg, , “Political Pressure and the Future of the Federal Reserve System,” Annals of the American Academy of Political and Social Sciences 99 (Jan. 1922): 70–74CrossRefGoogle Scholar; Warburg to S. Parker Gilbert, Sept. 1922, 17 Oct., 19 Dec. 1922, File Federal Reserve Board 1922, Box 70, Record Group 56, Records of the Treasury, National Archives II, College Park, Md.; Warburg to Gilbert, 8 Jan. 1923, Warburg to Ogden L. Mills, 24 Apr. 1930, File Federal Reserve Board 1923-1931, Box 71, ibid.; Warburg, “Politics a Menace to the Federal Reserve System,” interview published in The Annalist, 29 Jan. 1923, in The Federal Reserve System, 2:843-54; Chandler, , Benjamin Strong, 35, 49–50Google Scholar. On the extent to which other supporters of the Federal Reserve System shared this outlook, see Livingston, Origins of the Federal Reserve System, 219-21; Greider, Secrets of the Temple, 280-81; Kolko, Triumph of Conservatism, 250-51; Kettl, Donald F., Leadership at the Fed (New Haven, Conn., 1986), 1-3, 28Google Scholar.

8 West, Banking Reform, 54.

9 The best source on Strong is the biography by Chandler, Benjamin Strong; see also Rothbard, “Federal Reserve as a Cartelization Device,” 109-31; Kettl, Leadership at the Fed, 31-35; Greider, Secrets of the Temple, 293-99; Friedman, Milton and Schwartz, Anna Jacobson, A Monetary History of the United States, 1867-1960 (Princeton, N.J., 1963), 225–27Google Scholar.

10 See accounts mentioned in notes 1, 4, and 5 above.

11 For details of Warburg's views on the war, see Chernow, The Warburgs, 158-62; Roberts, Priscilla M., “A Conflict of Loyalties: Kuhn, Loeb and Company and the First World War, 1914-1917,” in Studies in the American Jewish Experience 2, eds. Marcus, Jacob R. and Peck, Abraham J. (Lanham, Md., 1984), 6-7, 11–14Google Scholar; Warburg, James P., The Long Road Home: The Autobiography of a Maverick (New York, 1963), 7-8, 11, 15–18Google Scholar.

12 See references in note 2 above.

13 See, e.g., J. P. Morgan & Co. to Morgan, Grenfell & Co., 27 Nov. 1916, J. P. Morgan & Co. to Edward C. Grenfell, 28 Nov. 1916, U.S. Senate, 74 Cong., 2d Sess., Hearings Before the Committee Investigating the Munitions Industry, 40 vols. (Washington, D.C., 1934-36), 28:8736-39; J. P. Morgan & Co., “Memorandum Relative to Financing by J. P. Morgan & Co. during the World War,” no date, 93, File 213-7, Lamont Papers; New York Times, 23 Nov. 1914; Chernow, The Warburgs, 161; Vagts, Alfred, “M. M. Warburg & Co.: Ein Bankhaus in der deutschen Weltpolitik 1905-1933,” Vierteljahrschrift für Sozial- und Wirtschaftsgeschichte 45 (Sept. 1958): 355Google Scholar.

14 Benjamin Strong to Frederick A. Delano, 22 Sept. 1916, File 211.1, Benjamin Strong Papers, Federal Reserve Bank of New York, New York.

15 Strong, diary, 18 Mar. 1916, File 1000.2, ibid.; Strong to Fred I. Kent, 19 July 1915, Munitions Hearings, 30:9527; Warburg, Memorandum for Federal Reserve Board, 13 Nov. 1916, ibid., 26:8103-06; Warburg to Adolph C. Miller, 14 Nov. 1916, Box 169, William Gibbs McAdoo Papers, Manuscripts Division, Library of Congress, Washington, D.C.; Warburg to Strong, 23 Nov. 1916, Warburg to R. H. Treman, 23 Nov. 1916, File 211.3, Strong Papers; Warburg, “Memorandum for Mr. Glass,” 1 Dec. 1916, Warburg, “Amendment Submitted by the Federal Reserve Board to Congress—End of Dec. 1916,” Box 7, Paul M. Warburg Papers, Yale University Library, New Haven, Conn.

16 Livingston, Origins of the Federal Reserve System, 202-03; Kaufman, Efficiency and Expansion, 30; Broz, International Origins, 142-59; Abrahams, “Foreign Expansion of American Finance,” 4-8.

17 Ibid., 16-17; Kaufman, Efficiency and Expansion, 76; Parrini, Heir to Empire, 103-04; Phelps, Foreign Expansion of American Banks, 109-11.

18 Chandler, Benjamin Strong, 32; Warburg, , “Circulating Credits and Bank Acceptances,” Proceedings of the Academy of Political Science 4 (July 1914): 159–72Google Scholar.

19 Russell C. Leffingwell to Secretary of the Treasury, 14 June 1920, Letterbook 43b, Russell C. Leffingwell Letterbooks, Manuscripts Division, Library of Congress, Washington, D.C.

20 Warburg, , “The Discount System in Europe,” Proceedings of the Academy of Political Science 4 (July 1914): 129–58Google Scholar; Warburg, “History of the Development of the Acceptance Regulation,” 5 Oct. 1915, 2, 5, 6, 7, Warburg, “Memorandum,” 30 Mar. 1915, Warburg to Frank A. Vanderlip, 17 June 1915, Box 12, Warburg Papers; Chandler, Benjamin Strong, 86-93; Cooper, “Command of Gold Reversed,” 215-16.

21 The disputes may be followed in the Munitions Hearings, 27:8214-35; exhibits 2386-450, ibid., 8385-426; exhibits 3557-658, 3883-89, ibid., 31:9909-10030, 10167-70; and in the various Federal Reserve Board Files for the period 1914-1917 in Boxes 328-31, 74 Cong., 2d Sess., U.S. Sen., Papers of the Special Committee Investigating the Munitions Industry, Record Group 46, National Archives, Washington, D.C. [hereafter Nye Committee Papers]. Accounts of the 1915 disputes are also given in Warburg, “History of the Development of the Acceptance Regulation,” 5 Oct. 1915, Box 12, Warburg Papers; and in works by Abrahams, Link, Devlin, Peterson, and Cooper, as cited in note 3 above.

22 Warburg, Memorandum, 30 Mar. 1915, Box 12, Warburg Papers.

23 Warburg to Charles S. Hamlin, 2 Aug. 1915, ibid.

24 Warburg, Memorandum, 5 Feb. 1915, ibid.

25 Warburg, “History of the Development of the Acceptance Regulation,” 5 Oct. 1915, 10-12, ibid.

26 Strong to Delano, 8 Feb. 1915, Munitions Hearings, 27:8389-90.

27 Warburg, “History of the Development of the Acceptance Regulation,” 5 Oct. 1915, 21-27, Strong, redraft of acceptance regulations, Mar. 1915, Box 12, Warburg Papers.

28 J. P. Morgan, Jr., to J. P. Morgan & Company, 29 Mar. 1915, enclosed in Henry P. Davison to Strong, 9 Apr. 1915, File Federal Reserve Board 1915, Box 328, Nye Committee Papers.

29 William G. McAdoo to Woodrow Wilson, 21 Aug. 1915, Munitions Hearings, 26:8123-25.

30 Warburg, Memorandum, 6 Feb. 1915, Box 12, Warburg Papers.

31 Strong to Pierre Jay, 7 Apr. 1915, Munitions Hearings, 27:8390-91.

32 Ibid., 8219-21; Morgan to J. P. Morgan & Co., 29 Mar. 1915, ibid., 8386; Davison to Strong, 9 Apr. 1915, ibid., 8219; Strong to Davison, 9 Apr. 1915, ibid., 8391; Davison to Morgan, 10 Apr. 1915, Morgan to Davison, 12 Apr. 1915, ibid., 8221.

33 On the Brown Brothers credit and Strong's efforts to win Federal Reserve Board approval for it, see Charles S. Hamlin, diary, Vol. III, 28 June, 16, 20 July, 4, 10 Aug. 1915, Charles S. Hamlin Papers, Manuscripts Division, Library of Congress, Washington, D.C.; File Federal Reserve Board 1915, Box 328, Nye Committee Papers, esp. Strong to Brown Brothers, 12, 14 Aug. 1915, Brown Brothers to Strong, 13 Aug. 1915; Warburg, “History of the Development of the Acceptance Regulation,” 5 Oct. 1915, 21-24, and related documents, Box 12, Warburg Papers; Munitions Hearings, 27:8222-36; exhibits 2408-34, ibid., 8392-415; Abrahams, “Foreign Expansion of American Finance,” 61-64.

34 George L. Harrison, “Memorandum on the Right of the Federal Reserve Board to Restrict the Rediscount by Federal Reserve Banks of Acceptances Based on the Export of Munitions of War,” 24 July 1915, Box 141, McAdoo Papers, Hamlin, diary, Vol. III, 16 July 1915, Hamlin Papers; Link, Wilson: The Struggle for Neutrality, 619 n. 86; Devlin, Too Proud to Fight, 356.

35 Strong to McAdoo, 2 Aug. 1915, enclosing George Foster Peabody, William Woodward, and Strong to McAdoo, 2 Aug. 1915, Box 141, McAdoo Papers; Strong to McAdoo, 25 Aug. 1915, Box 143, ibid.; Strong to McAdoo, 25 Aug. 1915, Munitions Hearings, 31:10172. On this issue Strong also obtained and cited the favorable opinion of John Bassett Moore, a leading international lawyer. Strong to John Bassett Moore, 25 Aug. 1915, Moore to Strong, 26 Aug. 1915, File Federal Reserve Board 1915, Box 328, Nye Committee Papers. For Strong's views on American acceptances and Allied loans and their relationship to the gold situation, see Chandler, Benjamin Strong, 88-89; Cooper, “Command of Gold Reversed,” 216; Abrahams, “Foreign Expansion of American Banks,” 64-66. On leading pro-Allied New York bankers' desire to relax the acceptance regulations, see ibid., 60-66.

36 A full account of the cotton purchase operation is given in Link, Wilson: The Struggle for Neutrality, 599-616, and “The Cotton Crisis, the South, and Anglo-American Diplomacy, 1914-1915,” in Studies in Southern History, ed. Sitterson, J. Carlyle (Chapel Hill, N.C., 1957), 122–38Google Scholar; Devlin, Too Proud to Fight, 351-55; Broesamle, John J., William Gibbs McAdoo: A Passion for Change 1863-1917 (Port Washington, N.Y., 1973), 178–81Google Scholar; Munitions Hearings, 31:10135-47. Further details of the Morgan firm's Southern interests may be found in Carosso, Vincent P., The Morgans: Private International Bankers 1854-1913 (Cambridge, Mass., 1987), esp. chs. 13 and 16Google Scholar.

37 Hamlin, diary, Vol. III, 28 July 1915, Hamlin Papers; Delano to McAdoo, 31 July 1915, Box 141, McAdoo Papers.

38 Warburg, “History of the Development of the Acceptance Regulation,” 5 Oct. 1915, 21-24, Strong to Warburg, 9 June 1915, Warburg to Strong, 11 June 1915, Warburg to Pierre Jay, 17, 18 June 1915, Warburg to Joseph P. Cotton, 18 June 1915, Warburg to Hamlin, 7 July, 2 Aug. 1915, all in Box 12, Warburg Papers; Hamlin, diary, Vol. III, 16 July, 4 Aug. 1915, Hamlin Papers; Munitions Hearings, 27:822-36; exhibits 2408-34, ibid., 8392-415.

39 Warburg to Strong, 10 Sept. 1915, Box 12, Warburg Papers.

40 Warburg to Federal Reserve Board, 8 Aug. 1915, ibid.; Hamlin, diary, Vol. III, 4 Aug. 1915, Hamlin Papers.

41 Strong to Warburg, 9 June 1915, Box 12, Warburg Papers.

42 Ibid.; Warburg to Federal Reserve Board, 8 Aug. 1915, Box 12, Warburg Papers.

43 McAdoo to Woodrow Wilson, 21 Aug. 1915, Munitions Hearings 26:8123-25; excerpt from minutes of meeting of Federal Reserve Board, 10 Aug. 1915, File Federal Reserve Board-Excerpts from Minutes, Box 329, Nye Committee Papers; Hamlin to McAdoo, 12 Aug. 1915, Box 141, McAdoo Papers; Hamlin, diary, Vol. III, 10 Aug. 1915, Hamlin Papers. Quotation from McAdoo to Wilson, 21 Aug. 1915.

44 Hamlin to McAdoo, 12 Aug. 1915, Box 141, McAdoo Papers, Hamlin to McAdoo, 14 Aug. 1915, Box 142, ibid.; Hamlin, diary, Vol. III, 10 Aug. 1915, Hamlin Papers; Warburg to W. P. G. Harding, 13 Aug. 1915, quoted in Harding to McAdoo, 13 Aug. 1915, Munitions Hearings, 31:10137-38; McAdoo to Wilson, 21 Aug. 1915, ibid., 26:8123-25; Edward M. House, diary, 25 Aug. 1915, ibid., 31:10141-42. Quotation from Hamlin to McAdoo, 12 Aug. 1915.

45 Hamlin to McAdoo, 12 Aug. 1915, Box 141, McAdoo Papers; Hamlin, diary, Vol. III, 10 Aug. 1915, Hamlin Papers; Munitions Hearings, 27:8234-36.

46 Hamlin to McAdoo, 12 Aug. 1915, Box 141, McAdoo Papers; Hamlin, diary, Vol. III, 10 Aug. 1915, Hamlin Papers.

47 See references in previous note; also W. P. G. Harding to McAdoo, 13 Aug. 1915, Munitions Hearings, 31:10137-38; Warburg, “History of the Development of the Acceptance Regulation,” 3 Oct. 1915, 25, 27-29, Box 12, Warburg Papers. On McAdoo's attitude, see McAdoo to Wilson, 21 Aug. 1915, Munitions Hearings, 26:8123-25; also Link, Wilson: The Struggle for Neutrality, 619-21; Devlin, Too Proud to Fight, 356; Abrahams, “Foreign Expansion of American Finance,” 67-68; Cooper, “Command of Gold Reversed,” 215-16.

48 Hamlin, diary, Vol. III, 17 Aug. 1915, Hamlin Papers; excerpt from minutes of meeting of Federal Reserve Board, 1 Sept. 1915, File Federal Reserve Board-Excerpts from Minutes, Box 329, Nye Committee Papers.

49 See the text of Regulation R, 7 Sept. 1915, Box 12, Warburg Papers; Warburg, “History of the Development of the Acceptance Regulation,” 5 Oct. 1915, 27, 30-33, ibid.; minutes of Federal Reserve Board meeting, 3 Sept. 1915, Munitions Hearings, 27:8417-20; Hamlin, diary, Vol. III, 3 Sept. 1915, Hamlin Papers. On the new regulations significance, see also Link, Wilson: The Struggle for Neutrality, 628 n. 106; Devlin, Too Proud to Fight, 356; Abrahams, “Foreign Expansion of American Finance,” 68-69.

50 Harding to Strong, 7 Feb. 1916, and enclosed “Memorandum,” File Federal Reserve Board-Acceptances, Box 337, Nye Committee Papers.

51 Abrahams, “Foreign Expansion of American Finance,” 69-70; tables relating to acceptances, 1915-1917, File Federal Reserve-Acceptances (for Miss Burns), Box 328, Nye Committee Papers; Excerpt from minutes of Federal Reserve Board, 11 Dec. 1916, Munitions Hearings, 31:9961. To put these figures in perspective, the five public loans which J. P. Morgan and Company floated for the Allies between Oct. 1915 and Feb. 1917 amounted to $1.4 billion and American investors insisted that all but the first half billion of this total be backed by the collateral of reliable Allied investments. As this article will shortly demonstrate, by 1916 raising even $100 million for the Allies, especially if this were to be unsecured, posed a massive challenge for the Morgan firm.

52 Quotation from Warburg, “Memorandum for the Board,” 20 June 1916, ibid., 31:9960; see also Warburg to Strong, 21 June, 10 Nov. 1916, ibid., 9920, 9956; exhibits 3617-18, ibid., 9958-60. For details of these credits, many of which were arranged by such prominent New York banks as Morgans, Brown Brothers, the Bankers Trust Company, and the Guaranty Trust Company, see exhibits 3645-58, ibid., 9979-10040; also Abrahams, “Foreign Expansion of American Finance,” 71.

53 Sir Felix Schuster to Warburg, 3 Nov. 1915, enclosed in Warburg, “Memorandum to the members of the Federal Reserve Board,” 17 Nov. 1915, Box 148, McAdoo Papers; on the Bank of England's policy toward finance bills, see also Sayers, R. S., The Bank of England 1891-1944, 3 vols. (Cambridge, U.K., 1976), 1:124, 275–79Google Scholar. Strong obtained similar information from Montagu Norman of the Bank of England. In arguments with Warburg, however, he cited the contrary—and inaccurate—opinions given him by the more patriotic Sir Edward Holden of the London City and Midland Bank and Edward Grenfell, who was a partner in Morgan, Grenfell & Co., the Morgan firm's London branch. Strong to Grenfell, 10 Dec. 1915, Grenfell to Strong, 22 Dec. 1915, File 1112.1, Strong Papers, Norman, “Memorandum,” 6 Jan. 1916, File 1116.1, ibid.; Strong to Warburg, 4 Oct. 1915, File 211.2, ibid.; Warburg to Strong, 11 Jan. 1916, File 211.3, ibid.

54 Abrahams, “Foreign Expansion of American Finance,” 59.

55 He pointed out in June 1916 that of the $55 million of acceptances held by the Federal Reserve system, $17 million related to “the so-called Brown credit,” an amount which represented slightly over one-third of the total $45 million of acceptances still outstanding against this credit. Warburg to Strong, 11 Jan. 1916, File 211.3, Strong Papers; Warburg, Memorandum for the Board, 20 June 1916, Kenzel to Jay, 23 June 1916, Munitions Hearings, 31:9960.

56 Warburg to Strong, 21 June 1916, ibid., 9920; B. G. McCloud to E. R, Kenzel, 31 May 1916, Theodore Wold to Kenzel, 2 June, 21 Sept. 1916, Kenzel to Jay, 20 June 1916, File Federal Reserve Miscellaneous, Box 341, Nye Committee Papers.

57 Warburg to Strong, 19 Jan. 1917, File 211.4, Strong Papers; for Vanderlip's views on acceptances, see also Frank A. Vanderlip to James Stillman, 5 Mar. 1915, Box 6, Series B-1, Frank A. Vanderlip Papers, Columbia University Library, New York; Strong to Pierre Jay, 5 Oct. 1916, File 320.111, Strong Papers; Hamlin, diary, Vol. IV, 18 Jan., 23 Feb. 1917, Hamlin Papers.

58 Brown to Strong, 1, 10 Dec. 1916, File Gold Pool of 1914, Brown Brothers Harriman Papers, New York Historical Society, New York. Strong refused to admit that Brown's criticisms possessed any validity. Strong to Brown, 4 Dec. 1916, ibid.

59 Harding to Strong, 7 Feb. 1916, with enclosed memorandum, Munitions Hearings, 31:9950-53; Harding to McAdoo, 21 Oct. 1916, Box 168, McAdoo Papers. On Harding's position, see also Abrahams, “Foreign Expansion of American Finance,” 71-73; Cooper, “Command of Gold Reversed,” 222.

60 Strong to Warburg, 1 Aug., 6 Sept. 1916, Warburg to Strong, 1 Sept. 1916, File 211.3, Strong Papers; on Warburg's prewar views, see also Strong to R. H. Treman, 2 Jan. 1917, File 320.222, ibid.

61 Chandler, Benjamin Strong, 93-98; Abrahams, “Foreign Expansion of American Finance,” 82-83. For details of these negotiations, see Strong, diary and letters during European trip of 1916, File 1000.2, Strong Papers; Munitions Hearings, 27:8239-52; exhibits 2354-95, ibid., 8428-55; File Federal Reserve Board-Bank of England 1915-1918, Box 329, Nye Committee Papers. The quotation is from Strong to Delano, 22 Sept. 1916, File 211.1, Strong Papers.

62 Hamlin, diary, Vol.III, 29 Aug. 1916, Hamlin Papers.

63 Strong, diary, 14 Mar. 1916, File 1000.2, Strong Papers.

64 Strong to Morgan, 31 Aug., 12 Sept. 1916, Munitions Hearings, 27:8846, 8848-49. On Morgan's support for the Bank of England arrangement, see Strong, diary, 14 Feb., 6-8 Mar. 1916, Strong to Jay, 22 Mar. 1916, File 1000.2, Strong Papers.

65 Hamlin, diary, Vol. III, 20 Apr., 16 May 1916, Hamlin Papers; Strong to Hamlin, 23 May 1916, Munitions Hearings, 27:8437-38, Strong to Treman, 21 Aug. 1916, ibid., 8445, Strong to Treman, 25 Nov., 11, 13 Dec. 1916, File 320.221, Strong Papers, Strong to Warburg, 1 Aug., 6 Sept. 1916, File 211.3, ibid.; Chandler, Benjamin Strong, 96-97.

66 Delano to Strong, 14 Sept. 1916, File 211.1, Strong Papers.

67 Hamlin, diary, Vol. III, 16 May, 29 Aug. 1916, Hamlin Papers; Treman to Strong, 9 Oct. 1916, File 320.221, Strong Papers.

68 Hamlin, diary, Vol. III, 29 Aug. 1916, Hamlin Papers.

69 Ibid., Vol. IV, 19 Dec. 1916; Warburg to Strong, 12 Mar. 1917, File 211.4, Strong Papers.

70 For details of the period when the Board was debating whether to implement these agreements, see exhibits 2466-95, Munitions Hearings, 27:8437-54; Hamlin, diary, Vol. III, 20 Apr., 16 May, 29, 30 Aug. 1916, Hamlin Papers; ibid., Vol. IV, 19, 26 Dec. 1916; Chandler, Benjamin Strong, 96-98.

71 On the Allies' mid-1916 difficulties in raising any further American funds, see “Memorandum Relative to Financing by J. P. Morgan & Co.,” 43-44, 61-65, 73-77, 82-90, 101-15, File 213-7, Lamont Papers; Munitions Hearings, 28:8517-35, 8637-54; exhibits 2570, 2693-702, ibid., 8710, 8854-96; exhibits 3192-217, ibid., 30:9604-18; Peterson, Propaganda for War, 259-63; Burk, Britain, America, and the Sinews of War, 74-80.

72 “Our Financial Position in America,” introduction to secret British cabinet paper drafted by J. M. Keynes and signed by Reginald McKenna, Chancellor of the Exchequer, 24 Oct. 1916, in Keynes, John Maynard, The Collected Works of John Maynard Keynes Vol. XVI: Activities, 1914-1919: The Treasury and Versailles, ed. Johnson, Elizabeth (London, 1971), 198–209Google Scholar; Lamont, Henry P. Davison, 202-03; Nicolson, Dwight Morrow, 176; Link, Arthur S., Wilson: Campaigns for Progressivism and Peace 1916-1917 (Princeton, N.J., 1965), 182–84Google Scholar; Devlin, Too Proud to Fight, 548-51; Burk, Britain, America, and the Sinews of War, 81-82; Cooper, “Command of Gold Reversed,” 219-21. Realization of Britain's dependence upon American finance led directly to the Marquess of Lansdowne's compromise peace proposals of Nov. 1916.

73 J. P. Morgan & Co. to Davison, 9 Oct. 1916, Munitions Hearings, 30:9610-11; see also “Memorandum Relative to Financing by J. P. Morgan & Co.,” 80, File 213-7, Lamont Papers.

74 For details of the proposed credit and the negotiations leading up to it, see File Bonbright & Co. 1916, Box 328, Nye Committee Papers; File French Export Credit, Box 340, ibid.; exhibits 3573-98, 3646, 3656-58, Munitions Hearings, 31:9920-38, 9980,10027-40; also Abrahams, “Foreign Expansion of American Finance,” 71-72; Cooper, “Command of Gold Reversed,” 222.

75 On the New York Reserve Bank's support for the credit, see Jay to Warburg, 20 Oct. 1916, Jay to Harding, 21 Oct. 1916, Munitions Hearings, 31:9937-39; Harding to McAdoo, 21 Oct. 1916, Box 168, McAdoo Papers. On Morgans' involvement, see Davison and Herman H. Harjes to Morgan and Lamont, 21 Sept. 1916, Arthur Bonbright to Alexander Phillips, 23 Sept. 1916, Phillips to Guaranty Trust Co., 23 Sept. 1916, Lamont to Davison, 6 Oct. 1916, Munitions Hearings, 31:9929-31.

76 Telegram sent by Federal Reserve Board to all Reserve Agents, 23 Oct. 1916, Munitions Hearings, 21:9940-41; see also minutes of Federal Reserve Board meeting, 23 Oct. 1916, ibid., 9939-40; Abrahams, “Foreign Expansion of American Finance,” 75; Cooper, “Command of Gold Reversed,” 222. For Strong's attempt to prevent the telegram's issue, see Strong to Jay, 22 Oct. 1916, Munitions Hearings, 31:9939.

77 Warburg to Strong, 23 Nov. 1916, Warburg to Treman, 23 Nov. 1916, File 211.3, Strong Papers; Abrahams, “Foreign Expansion of American Finance,” 75.

78 Quotation from Harding to McAdoo, 23 Oct. 1916, File 334.1 Federal Reserve Board-Foreign Loan Policy, Box 336, Nye Committee Papers; see also Harding to John Perrin, 31 Oct. 1916, ibid.; Harding to McAdoo, 21 Oct. 1916, Box 168, McAdoo Papers; Harding to Strong, 16 Nov. 1916, Munitions Hearings, 31:9966-67; Cooper, “Command of Gold Reversed,” 222.

79 Curtis to Strong, 28 Oct. 1916, File 320.151, Strong Papers, gives an account of the further interview of the bankers involved with the Federal Reserve Board, when the Board maintained its discouraging stance. In a minor but related incident that month, the Board also ruled adversely on an application by the Mechanics and Metals National Bank, which Strong supported, to accept for three months” drafts drawn for the purpose of furnishing dollar exchange to Allied banks and bankers. Using arguments of the kind which had already won him the reputation of being overly independent of the Board, Strong protested against this ruling. He contended that “it would be the best for the growth of our acceptance system if there were no restriction whatsoever … and if our member banks could be permitted to accept according to the requirements of trade and finance, leaving it to the business judgment of the central banks and the banking community in general to regulate any abuse.” Warburg, who was instrumental in the applications rejection, retorted that he did not wish to foreswear his own testimony before the Senate Committee on Banking and Currency on the Federal Reserve Act's acceptance provision. At that time he had stated that no such transactions would be legal under the Act's acceptance section, which he believed he had “personally secured” by his assurances. Strong to Jay, Oct. 1916, File 320.111, Strong Papers; Warburg to Jay, 10 Nov. 1916, File 211.3, ibid.

80 Strong to Jay, 22, 24 Oct. 1916, Munitions Hearings, 31:9939, 9941.

81 Strong to J. F. Curtis, 27 Oct., 1 Nov. 1916, File 320.151, Strong Papers; Strong to Warburg, 30 Oct., 6 Nov. 1916, File 211.3, ibid.; Strong to Jay, 9, Nov. 1916, File 320.111, ibid.

82 Ibid.; Strong to Treman, 27 Oct. 1916, File 320.221, ibid.; Strong to Warburg, 25, 30 Oct., 6, 17, 20, 28 Nov., 2, 21 Dec. 1916, File 211.3, ibid.; Strong to Warburg, 4 Jan. 1917, File 211.4, ibid.; Strong to Curtis, 1 Nov. 1916, File 320.151, ibid.; Strong to Harding, 20 Nov. 1916, Munitions Hearings, 31:9973-74.

83 Quotation from Warburg to Strong, 16 Nov. 1916, File 211.3, Strong Papers; see also Warburg to Strong, 23, 30 Oct., 27 Nov. 1916, ibid.; Warburg to Strong, 19 Jan. 1917, File 211.4, ibid.; Warburg to Strong, 15 Dec. 1916, Munitions Hearings, 31:10149-53.

84 Warburg to Strong, 30 Oct. 1916, File 211.3, Strong Papers. Warburg still continued to maintain that the French government had effectively guaranteed the 1915 Brown Brothers transaction and that Strong had deceived the Board on this issue. Strong to Curtis, 27 Oct., 1 Nov. 1916, File 320.151, ibid.; Hamlin, diary, Vol. III, 29 Aug. 1916, Hamlin Papers.

85 Warburg to Strong, 23, 30 Oct., 16 Nov. 1916, File 211.3, Strong Papers.

86 Although Strong violently opposed the introduction of a preferential rate for genuine commercial paper, in Nov. 1916 he wrote to the Board recommending such a measure. His action was designed to prevent the Board declaring renewal acceptances completely ineligible for rediscount and also, as he himself put it, to disarm criticism “that I have been exceedingly rigid and stiff-necked in” his dealings with the Board. He was delighted when his proposal was defeated. Quotation from Strong to Treman, 29 Nov. 1916, File 320.221, ibid.; see also Strong to Treman, 2 Dec. 1916, ibid.; Strong to Jay, 9 Nov. 1916, File 320.111, ibid.

87 Warburg, Memorandum to Federal Reserve Board, 13 Nov. 1916, Munitions Hearings, 26:8103-04; see also Warburg to Strong, 23 Nov. 1916, File 211.3, Strong Papers; Hamlin, diary, Vol. IV, 25 Nov. 1916, Hamlin Papers.

88 Even though Wilson effectively followed the strategy recommended by Warburg and Harding, no concrete evidence exists that the president's policies were influenced by their arguments. None of Warburg's voluminous memoranda are included among Wilsons papers, nor did the president ever specifically refer to his advice, and the juxtaposition of Warburg's suggestions and Wilson's actions, though suggestive, might be entirely coincidental. Indeed, at this time Wilson's diplomatic policies would have been greatly compromised had the slightest suspicion arisen that they reflected the advice of a German-born banker. It seems unlikely that Wilson can have been ignorant of the debates raging within the Federal Reserve System, but in the absence of further evidence the possibility that any connection existed between his policies and Warburg's prescriptions, though intriguing, must remain purely speculative.

89 For accounts of the Treasury bills episode and its wider implications, see Link, Wilson: Campaigns for Progressivism and Peace, 200-03; Devlin, Too Proud to Fight, 585-87; Lamont, Henry P. Davison, 205-10; Peterson, Propaganda for War, 263-66; Abrahams, “Foreign Expansion of American Finance,” 76-78; Burk, Britain, America, and the Sinews of War, 82-86; Cooper, “Command of Gold Reversed,” 221-27; J. P. Morgan & Co., “Memorandum on Financing by J. P. Morgan & Co.,” 91-95, File 213-7, Lamont Papers; Munitions Hearings, 28:8548-69; exhibits 2590-624, ibid., 8724-47.

90 New York Times, 31 Oct., 4 Nov. 1916; Commercial and Financial Chronicle 103 (4 Nov. 1916): 1664Google Scholar; ibid. (11 Nov. 1916): 1741-42; press clippings enclosed in Harding to McAdoo, 4 Nov. 1916, Box 169, McAdoo Papers; Morrow, address to Commercial Club, 9 Nov. 1916, Speeches File, Dwight W. Morrow Papers, Amherst College Library, Amherst, Mass.

91 Excerpt from minutes of meeting of the Federal Reserve Board, 18 Nov. 1916, Box 329, Nye Committee Papers.

92 Davison to Morgan, 20 Nov. 1916, File Morgan 1916, Box 366, ibid. See also Davison to Wilson, 25 Nov. 1916, in The Papers of Woodrow Wilson, ed. Link, Arthur S., 69 vols. (Princeton, N.J., 1966-1994), 40:75–76Google Scholar.

93 Contemporary accounts of Davison's interview with the Board are given in Hamlin, diary, Vol. IV, 19 Nov. 1916, Hamlin Papers; Davison to Morgan, 20 Nov. 1916, Munitions Hearings, 28:8730; Delano to Strong, 19 Dec. 1916, File 211.1, Strong Papers; Curtis to Strong, 23 Nov., 16 Dec. 1916, File 320.151, ibid.; Curtis to Strong, 8 Jan. 1917, File 320.152, ibid.; Warburg to Strong, 23 Nov. 1916, File 211.3, ibid.; Warburg to House, 18 Nov. 1916, Box 114a, Edward M. House Papers, Yale University Library, New Haven, Conn. The quotations are from Delano to Strong, 19 Dec. 1916, and Curtis to Strong, 8 Jan. 1917. See also J. P. Morgan & Co., “Memorandum Relative to Financing by J. P. Morgan & Co.,” 92, File 213-7, Lamont Papers.

94 Quotation from Strong to Curtis, 20 Dec. 1916, File 320.151, Strong Papers; see also Strong to Curtis, 4 Dec. 1916, ibid.; Strong to Treman, 28 Nov. 1916, File 320.221, ibid.; Strong to Jay, 15 Dec. 1916, Munitions Hearings, 30:9544; Brown to Strong, 1 Dec. 1916, File Gold Pool of 1914, Brown Brothers Harriman Papers. British and French officials also deplored Davison's lack of finesse in this episode. Hamlin, diary, Vol. IV, 30 Dec. 1916, 14 Feb. 1917, Hamlin Papers; Devlin, Too Proud to Fight, 586-87; Abrahams, “Foreign Expansion of American Finance,” 78; Burk, Britain, America, and the Sinews of War, 88-90; Cooper, “Command of Gold Reversed,” 227.

95 See the accounts cited in the preceding footnote; also Burk, Britain, America, and the Sinews of War, 357. In view of the difficulties which the Allies experienced at this time when they attempted to raise any funds in the United States, it seems more likely that relatively few such bills would have been sold.

96 Delano to Strong, 19 Dec. 1916, File 211.1, Strong Papers.

97 Ibid.; Warburg to Strong, 23 Nov. 1916, Warburg to Treman, 23 Nov. 1916, File 211.3, ibid.; Curtis to Strong, 16 Dec. 1916, File 320.151, ibid.; Hamlin, diary, Vol. IV, 20, 21, 24 Nov. 1916, Hamlin Papers; Cooper, “Command of Gold Reversed,” 224; Burk, Britain, America, and the Sinews of War, 84.

98 Hamlin, diary, Vol. IV, 25 Nov. 1916, Hamlin Papers.

99 Ibid., 25, 27 Nov. 1916; Wilson to Harding, 26 Nov. 1916, and enclosure, Harding to Wilson, 27 Nov. 1916, and enclosure, in Wilson Papers, 40:77-80, 87-88; Munitions Hearings, 28:8552-53; Link, Wilson: Campaigns for Progressivism and Peace, 201-03, Devlin, Too Proud to Fight, 586; Abrahams, “Foreign Expansion of American Finance,” 77; Burk, Britain, America, and the Sinews of War, 84-85; Cooper, “Command of Gold Reversed,” 224-25. A week later the president also endorsed the decision of John Skelton Williams, the Comptroller of the Currency, to make no public announcement of the fact that American banks' holdings of foreign securities stood at only $223,939,000, substantially less than the $300-500 million often estimated. Wilson, whose peace initiative was then under way, kept this information confidential on the grounds that he was “not sure what indirect effect the publication might have on some of our foreign relations.” Williams to Wilson, 6 Dec. 1916, Wilson to Williams, 11 Dec. 1916, Woodrow Wilson Papers, Manuscripts Division, Library of Congress, Washington, D.C.

100 For the full text of this announcement, see Munitions Hearings, 28: 8734-35.

101 J. P. Morgan & Co., “Memorandum Relative to Financing by J. P. Morgan & Co.,” 93-95, File 213-7, Lamont Papers; Munitions Hearings, 28:8558-60; Grenfell to J. P. Morgan &Co., 27 Nov. 1916 (two telegrams), Davison to Morgan, Grenfell & Co., 29 Nov. 1916, Harjes to J. P. Morgan & Co., 1 Dec. 1916, J. P. Morgan & Co. to Grenfell, 30 Nov. 1916, Grenfell to J. P. Morgan & Co., 30 Nov. 1916, J. P. Morgan & Co., statement, 1 Dec. 1916, ibid., 28:8741-45; Link, Wilson: Campaigns for Progressivism and Peace, 203; Devlin, Too Proud to Fight, 586; Burk, Britain, America, and the Sinews of War, 85.

102 J. P. Morgan & Co. to Grenfell, 28 Nov. 1916, J. P. Morgan & Co. to Harjes, 28 Nov. 1916, Munitions Hearings, 28: 8738-40.

103 J. P. Morgan & Co., “Memorandum Relative to Financing by J. P. Morgan & Co.,” 95-97, File 213-7, Lamont Papers; Keynes, , “Notes on Exchange Control,” 1939, in Collected Writings of John Maynard Keynes, 16:210–12Google Scholar; Link, Wilson: Campaigns for Progressivism and Peace, 203; Devlin, Too Proud to Fight, 586; Peterson, Propaganda for War, 264; Lamont, Henry P. Davison, 211; Abrahams, “Foreign Expansion of American Finance,” 77, 79; Burk, Britain, America, and the Sinews of War, 86-87.

104 J. P. Morgan & Co. to Grenfell, 28 Nov. 1916, Munitions Hearings, 28: 8738-39.

105 Strong to Curtis, 4 Dec. 1916, File 320.151, Strong Papers; Strong to Treman, 28 Nov. 1916, File 320.221, ibid.

106 Ibid.

107 Strong to Warburg, 28 Nov., 2, 21 Dec. 1916, File 211.3, ibid.

108 Warburg to Strong, 23 Nov. 1916, ibid.; see also Warburg, Memorandum for Federal Reserve Board, 13 Nov. 1916, Munitions Hearings, 26:8103-06.

109 Warburg to Carter A. Glass, 29 Feb. 1916, Warburg, draft of letter to Committee on Banking and Currency, 29 June 1916, Warburg to McAdoo, 8 July 1916, all in Box 6, Warburg Papers; Warburg to Adolph C. Miller, 14 Nov. 1916, Box 169, McAdoo Papers; Warburg to Delano, 20 Nov. 1916, Warburg, “Memorandum for Mr. Glass,” 1 Dec. 1916, Warburg, Report on Federal Reserve System, 18 Dec. 1916, Warburg, “Memorandum: Amendments Submitted by the Federal Reserve Board to W.P.G. Harding,” 19 Feb. 1917, Warburg, draft letter to Woodrow Wilson, 2 Apr. 1917, all in Box 7, Warburg Papers; Warburg, , The Federal Reserve System, 2:411–47Google Scholar. On Strong's support for such an amendment, see Chandler, Benjamin Strong, 83-86.

110 Vanderlip to Prince A. Poniatowski, 20 Aug. 1916, Box 7, Series B-1, Vanderlip Papers; Lamont and Morrow to Morgan, 20 Oct. 1916, Munitions Hearings, 28:8729-30; Warburg to Strong, 19 Jan. 1917, File 211.3, Strong Papers.

111 Warburg to Strong, 23 Nov. 1916, ibid.; see also Warburg, Memorandum to Federal Reserve Board, 13 Nov. 1916, Munitions Hearings, 26:8103-05.

112 Quotation from Warburg to Treman, 23 Nov. 1916, File 211.3, Strong Papers; see also Warburg to Strong, 23, 27 Nov. 1916, ibid.; Warburg to House, 18 Nov. 1916, Box 114a, House Papers; Warburg, Memorandum to Federal Reserve Board, 13 Nov. 1916, Munitions Hearings, 26: 8103-06.

113 On the Allies' desperate financial situation in early 1917, see exhibits 2663-90, ibid, 8799-815; Link, Wilson: Campaigns for Progressivism and Peace, 379-82; Burk, Britain, America, and the Sinews of War, 91-95; Cooper, “Command of Gold Reversed,” 227.

114 See Roberts, “Conflict of Loyalties,” 1-32, 169-82.

115 Roberts, “American ‘Eastern Establishment,’” 437-39, 450-52, 530-35.

116 Quotations from Strong, diary, 4 Sept. 1919, File 1000.3, Strong Papers; Strong to Brien Cokayne, 10 Dec. 1919, File 1115.2, ibid.

117 Warburg, “Uncle Sam's Gold Policy,” reprinted from Manchester Guardian Commercial, 16 Nov. 1922, in The Federal Reserve System, 2:814.

118 On their later efforts, see inter alia Chandler, Benjamin Strong, 247-422; Clarke, Stephen V. O., Central Bank Cooperation 1924-1931 (New York, 1967Google Scholar); Meyer, Richard Hemmig, Bankers' Diplomacy: Monetary Stabilization in the 1920s (New York, 1970Google Scholar); Chernow, The Warburgs, 220-24, 230, 273-75, 308-11; Warburg, Long Road Home, 52-57; Roberts, “American ‘Eastern Establishment,’” 437-39, 450-52, 530-35.

119 Quotation from Norman to G. Vissering, 16 Nov. 1921, File G3/177, Bank of England Archives, London; see also, for example, Norman to W. H. Clegg, 13, 25 Oct., 17 Dec. 1921, ibid; Norman to V. Moll, 6 Feb. 1922, Norman to Baron Havenstein, 23 June 1922, File G3/178, ibid.

120 On these efforts, see references in last note but one; also Chernow, House of Morgan, chs. 11-15; and the highly critical account of both these measures and their consequences in Eichengreen, Barry, Golden Fetters: The Gold Standard and the Great Depression, 1919-1939 (New York, 1992Google Scholar).

121 The 1921 effort is described from various perspectives in ibid., 119-21; Friedman and Schwartz, Monetary History, 234-235; Roberts, “American ‘Eastern Establishment,’” 522. Federal Reserve discount policy before Britain's return to gold is covered in Friedman and Schwartz, Monetary History, 282-84, 288; Chandler, Benjamin Strong, 241-46, 300-07; Eichengreen, Golden Fetters, 162-65, 190-91; Clarke, Central Bank Cooperation, 95-96; Wicker, Elmus R., Federal Reserve Monetary Policy 1917-1933 (New York, 1966), 80, 89–90Google Scholar; idem, “Federal Reserve Monetary Policy, 1922-33: A Reinterpretation,” Journal of Political Economy 73 (Aug. 1965); 333-36; Sayers, , Bank of England, 1:139–40Google Scholar; Sir Clay, Henry, Lord Norman (London, 1957), 140–44Google Scholar. Strong gave his own account of the fairly contentious 1927 episode in “The Chicago Rate Controversy,” 11 Sept. 1927, File 320.121, Strong Papers. It may also be followed in Friedman and Schwartz, Monetary History, 288-89; Eichengreen, Golden Fetters, 207-16; Chandler, Benjamin Strong, 375-77, 438-55; Clarke, Central Bank Cooperation, 123-24; Wicker, Federal Reserve Monetary Policy, 106-16; Sayers, , Bank of England, 1:336–45Google Scholar.

122 Hoover, Herbert, The Memoirs of Herbert Hoover, vol. 3, The Great Depression, 1929-1941 (New York, 1952), 3–14Google Scholar, quotation from p. 5.