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269703885
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Memorandum from Secretary of State George C. Marshall to President Harry S. Truman
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doc
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document
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1
Source metadata
id
269703885
contentType
document
title
Memorandum from Secretary of State George C. Marshall to President Harry S. Truman
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President's Secretary's Files (Truman Administration)
Subject Files
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269703885
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1
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1947-08-01
month
8
year
1947
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nara-archive
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6eb6fa9938007c57
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SEGRET FOR THE PRESIDENT August 1, 1947 Subject: Reported Impending British Dollar Crisie The British Charge d'affaires has left with me an Aide Nenoire expressing his government's concern at the rapid depletion of its dollar resources. The Aide Mesoire stated that at the present rate of depletion the balance remaining from the $3-3/4 billion U. S. loan will be exhausted by fall. There will than be left only basic monetary reserves, which at the current rate of loss would not last beyond April or May of 1948. The British question whether in these straitened circusstances they could contribute leadership for a European recovery program. Moreover, they feel compelled to consider: (a) reducing their finan- cial commitments in Germany and elsewhere, (b) further curtailing imports and (c) withdrasing from multilsteralism in international trade. Background. The British have now drawn $2-3/4 billion, leaving a balance of only $1 billion. This situation has srisen in part bg- cause British purchases abroad have been made at prices higher than when the loan was nade. The rate of zorld recovery has been slower than anticipated, with the result that Britain has been forced to buy largely in the western hemisphere. A contributing factor has been the recent undertaking by the Unitad Kingdom to make sterlingconver~ tible as required by the Anglo-Aserican Financial Agreament. Britain's own failure to muster the full force of its productive resources has retarded the expansion of experts. Comment: Ambassador Douglas comments that the British position is eritical. He believes that awe run the serious risk of losing most of lestern durope if the crisis here develops as it now seeus almost certain to develop.* 1 agree that the possible develepments are most disturbing. we have talked to Treasury on this satter. They will confer with the British to deternine more precisely what the situation is and what the British thenselves can do. de will keep you advised of devolopmente. NATIORAL RECORDS GERVICE Go Oc MARSHALL DECLASSIFIED B.O. 11652, Sec. 3(E) and S(D) or (E) Dept. of State letter, 7-65-25 By NLT- He , NARS Date/1-6-75 SECRE