After the Deluge, 1931–1939

The events of 1931 were not the end of the story. Several important countries, including France and the United States, did not abandon gold during the disturbances of the summer. South Africa remained on the gold standard until the winter of 1932–3, when she was obliged by capital flight to leave gold and peg her currency to sterling. A group of European states which included France, Switzerland, Holland and Belgium, retained the gold standard in its classical form, thus becoming known as the ‘gold bloc’. For some years these states also kept their pre-1931 gold parities, although all were obliged to defend these parities by means of tariff-increases, quota controls on commodity imports, and from time to time some ineffective and half-hearted regulation of capital movements, in which few of them persevered. Some other countries, such as Argentina, Greece and Brazil, changed their gold parities.