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Thought for Today

 

Right through the ages we find this universal sense of Divine inspiration - this feeling that a wisdom beyond that of man shapes the destiny of States; that the institutions of men are but the imperfect instruments of a Divine and beneficent energy; helping their higher aims. Should not we, sir, grant the prayer of the many petitions that have been presented to us, by recognising at the opening of our great future our dependence upon God?
Delegate John Glynn, South Australia, Constitutional Convention, 1897

 

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Lords of Finance, Bankers Who Broke the World (L.Ahamed)
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Lords of Finance, Bankers Who Broke the World (L.Ahamed)

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It is commonly believed that the Great Depression that began in 1929 resulted from a confluence of events beyond any one person's or government's control. In fact, as Liaquat Ahamed reveals, it was the decisions taken by a small number of central bankers, that were the primary cause of the economic meltdown, the effects of which set the stage for World War II and reverberated for decades. In ‘Lords of Finance’, we meet the neurotic and enigmatic Montagu Norman of the Bank of England; the xenophobic and suspicious Emile Moreau of the Banque de France; the arrogant yet brilliant Hjalmar Schacht of the Reichsbank; and Benjamin Strong of the Federal Reserve Bank of New York, whose facade of energy and drive masked a deeply wounded and overburdened man. After the First World War, these central bankers attempted to reconstruct the world of international finance. Despite all their differences, they were united by a common fear-that the greatest threat to capitalism was inflation-and a common vision-that the solution was to turn back the clock and return the world to the gold standard. For a brief period in the mid- 1920S they appeared to have succeeded. The world's currencies were stabilized and capital began flowing freely across the globe. But beneath the veneer of boomtown prosperity, cracks began to appear in the financial system. The gold standard, that all had believed would provide an umbrella of stability, proved to be a straitjacket, and the world economy began that terrible downward spiral into what is known as the Great Depression. As yet another period of economic turmoil makes headlines today, the Great Depression and the year 1929 remain the benchmarks for true financial mayhem. Offering a new understanding of the global nature of financial crises, Lords of Finance is a potent reminder of the enormous impact that the decisions of central bankers can have, their fallibility, and the terrible human consequences that can result when they are wrong.





Last Updated: Monday, 20 May 2013 03:52