From Devaluation to the Gold Rush

1968 was even more palpitating than 1967 had been. If we had thought that devaluation would prove an instant solution to all our problems we should soon have been disillusioned. One crisis succeeded another, forcing us to contemplate extreme measures, and making us despair of eventual success. The exchange losses showed no sign of falling off; instead of repaying our debts we were obliged to borrow still more; the danger of a second devaluation, or even of being obliged to block sterling held abroad and at the same time letting the pound float, hung over us throughout the year. The crisis might initially seem unconnected with the pound: it could start with a rise in dealings in gold on the London market or with the rumour that the franc was about to be devalued or the mark upvalued. Any aggravation of currency uncertainty tended to rebound on sterling in its weakened condition causing large-scale withdrawals to a safer haven and bringing the exchange reserves near to exhaustion.