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← Lend-Lease and the War Economy
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Question
What was Britain's financial position by late 1940, and why did it threaten Britain's ability to continue fighting?
1
British domestic production was insufficient to supply the military, requiring American imports that exceeded Britain's import capacity
2
Britain had borrowed excessively from private American banks and faced margin calls that required liquidating war production assets
3
Britain had depleted its gold and foreign exchange reserves and could not continue paying for American supplies under the existing "cash and carry" policy
4
Britain had suspended gold convertibility, making its currency unacceptable to American suppliers
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