Furthermore, speculators of the Sterling Bloc countries were encouraged to use the London market by the fact that sterling was stable in terms of Sterling Bloc currencies. Throughout September and October there was large speculative buying of dollars in London on Swiss account, for instance. The resulting selling pressure on the krone was offset by sales of sterling by the Swedish authorities, and the British Exchange Equalization Account had to support sterling against pressure due to the Swedish purchase of dollars.
The conclusion suggested is, therefore, that the Sterling Bloc system possesses disadvantages as well as advantages for Great Britain. From more than one point of view it would be against Great Britain's interests if many more countries were to stabilize their currencies in relation to sterling. The British monetary authorities, however, have no means of p venting such developments, since any country with a moderate amount of gold or foreign exchange reserve is in a position to peg its exchange to sterling without asking London's consent Official quarters in London should certainly have realized by this time that it is. certainly not worth going out of their way to find new members of the Sterling Bloc. On the other hand, it is most unlikely that they will take active steps to discourage any country from joining, even if that were possible. Great Britain must endure the disadvantages of the Sterling Bloc, in the same way as she accepts the inconveniences attached to London's highly profitable róle as an international banking centre.
Text read from the printed page and cleaned; old type leaves the occasional error.