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1It is always difficult to judge whether the deficit of the US is too high. Since the dollar is the international currency, there would be demand for it from other countries and therefore accumulation of reserves. This would imply a current account deficit.
2It was under 3.2% in the UK in 1920, helped perhaps by pent-up demand from the war years, and rose to 11.3% after the 1922 budget cuts and to 9.7% in 1927 (Eichengreen and Hatton, 1988). This experience is in contrast to the 33 years between 1880 and 1913, where the average rate of unemployment was 4.7% and for 21 years in this period it was lower than this (Moggridge, 1972). Also, see Orde (1990) for a discussion of performance in the immediate post-war years.
3For further details, see Myers (1945). For a discussion of economic and political ramifications of the Hungarian loan, see Orde (1990).
4For a discussion of the Austrian loan, see Warnock (2015).
5This should be compared to the Marshall Plan under which the US gave U$13 billion.
6The A and B Bonds represented the total German reparations liability of US$12 billion, an amount smaller than what Germany had offered to pay at the beginning of the negotiations.
7Germany made its last reparations payment of US$94 million on October 3, 2010, settling its outstanding debt from the 1919 Versailles Treaty and finally closing the reparations chapter.
8For a history of reparations, see Findley and Rothney (2006).
9The US and the UK agreed on the necessity to reduce reparations. The UK hoped that the US would also reduce their war debts. For a discussion of the Dawes Plan, see Orde (1990).
10The French government, by contrast, issued bonds worth 44,000,000,000 francs from 1919 to 1925 to finance reconstruction of its devastated regions.
11Hegemonic theories can be divided into the realist school and the systemic school, which can be further sub-divided. Two dominant approaches in the realist school are exemplified by Keohane (1984) and Organski (1968). Modelski (1987) and Wallerstein (2004) are the two dominant approaches in the systemic school of thought. See Gilpin (1987) for a discussion of these theories. Also see Eichengreen (1996) and Cohen (2015).
12For details regarding the central bank lending to each other, see Agarwal (2017).
13Also see Flandreau (1997).
14The motives of the Banque de France in lending to the BE are analysed in Moure (2002).
15Their attitude towards the debts owed to them which they wanted paid in full was very different from that towards other debts and reparations. The British had borrowed on behalf of many others who lacked creditworthiness in the US market, and so its ability to repay its loans depended on it being repaid. The tough US negotiating stance then and later during and after World War II reflects the desire of US to eliminate the British challenge to their power.
16Under it the central banks would hold foreign currencies instead of gold. The British wanted them to hold sterling, which the French were not in favour of.
17For the French motivations, see Moure (1996).
18Later, the French had opposed the role of the dollar in the post-Second World War international monetary system. The then French president had wanted a return to gold to end what he called the “exorbitant privilege” of the US.
19More and more countries are adopting the framework of inflation targeting where the central has the responsibility of maintaining inflation in range and has to justify any failure.
20See the discussion in Pittaluga based on an index of cooperation developed by Borio and Toniolo (2006).
21This struggle is best described in Costigliola (1977). Ahamed (2009) also describes these events in similar terms without drawing any conclusions about whether there was a struggle for supremacy.
22The establishment of the GES can be seen, and the French saw it as an attempt to foist sterling on other central banks. Cooperation among central banks, many of the newer ones, was established with loans from England
