In July and August 1931, so many people sold pounds sterling and bought francs or dollars, so few did the reverse, that a flood of gold left England. To keep the Bank of England from being squeezed completely dry, Britain stopped gold payments, let the pound slide. Later the Government created an equalization fund of £150,000,000 (increased last May to £350,000,000), which was used by the Bank of England as the Government's agent to buy sterling when others sold, sell when others bought—keep the pound from fluctuating. By this means during the last...

Want the full story?

Subscribe Now


Learn more about the benefits of being a TIME subscriber

If you are already a subscriber sign up — registration is free!