Part 2 Chapter 14 Golden Summary and Analysis

By the mid-1920s, America has surpassed England as the world's banker and creditor. The London office of Morgan Grenfell moves to a new headquarters in 1927. Both Grenfell and Smith and their wives are active in the London social scene. In 1919 England goes off the gold standard in an attempt to recapture their position as a leading world financial center. The House of Morgan wants Britain back on the gold standard. They, along with John Maynard Keynes, fear that the exchange rates will become political. The pound has reached higher values in the exchange markets. If the pound can't hold its position, speculators will sell pounds for dollars, forcing the value down. The Fed keeps American interest rates low to prevent a speculative attack and maintain currency values. In 1925, Chancellor of the Exchequer, Winston Churchill puts England...