The Collapse of the World Economic Order Pg 128-129 Hallie Frost
The Role of the United States • In 1927 the United States would have 3% of the World’s population, and account for 46% of the World’s industrial output. 70% of the Oil and 40% of the Coal. The U.S propped up their allies in the recovering Europe and was inextricably tangled in the majority of foreign policy and trade across the globe. So when the stock market crashed in 1929, and industrial production declined by half, it sent not just the U.S but everyone who had come to depend on them into a state of economic devastation.
Currency Crash • Britain hoped to fix their currency’s exchange rate by selling gold for it, but this put the EU’s exchange rates in shambles. • US, France, Belgium, Netherlands, Switzerland remained on Gold Bloc • Britain and their trading partners adopted a new system on the Sterling Bloc • Germany, and other Latin American countries were then stuck and their currencies were inconvertible- causing them to lose out in what was left of the global market.
Tripartite Agreement • To fix the currency issue which was hindering trade between nations, the U.S , Britain, France, Belgium, Netherlands, Switzerland agreed to sell each other gold, for the recipient’s currency at an agreed upon price. This hoped to stabilize monetary international cooperation. But because it was not far spread enough, aka they didn’t include the counties supplying them with resources for production, the agreement was null.