Le Figaro
- The Rise of the Franc
- PRUDENCE AND LOGIC
- Voice of the People
Le Figaro's front page of 5 November 1926 opened with Lucien Romier's column on the franc. He reported that speculative buying of francs had for the first time drawn a broad public on the Bourse, and he likened the movement to a "panic in reverse" like the one that followed the franc's recovery in March 1924. In a signed editorial, François Coty recalled that the paper had backed an understanding with Germany early on, starting with economic agreements, and argued that divisions among the Allies now made full execution of the Versailles settlement impossible. A short item signed Le Masque de Fer described a Paris newspaper hawker hailing a "great victory for General Pinard in America", a joke at the expense of American Prohibition.
Translation
The Rise of the Franc
Yesterday, for the first time, the speculative movement betting on a rise of the franc, which has been building for some weeks, drew in a fairly large share of the stock-market clientele. It is well known that the whole art of speculation consists in using a more or less prolonged priming to set off the herd-like rush that will leave the speculators free to quit while they are ahead or to keep pursuing their luck at lower risk. We are witnessing the beginning of a panic in reverse, quite similar to the one that followed the recovery of the franc in March 1924.
PRUDENCE AND LOGIC
At a time when it took some courage to do so, we declared ourselves clearly in favor of an understanding with Germany, beginning with economic agreements; we spoke of all the good that would result from it for the peace of the world; we also acknowledged the difficulty of maintaining the boundaries of the European states and of their colonial domains as drawn by the Treaty of Versailles, whose full execution is henceforth made impossible by the divisions among the Allies.
Voice of the People
American Prohibition is not popular in France. Yesterday a beaming newspaper hawker, crying an evening paper, added: “Great victory for General Pinard in America!” And one could see that the good fellow was thus extolling the victory of “his” general.
Context
Why the franc was rising in the autumn of 1926
Romier was writing about a recovery that had begun that summer. On 21 July 1926, with the pound at a record 235 francs, President Gaston Doumergue called on Raymond Poincaré to form a national-union cabinet. Business and savers regained confidence at once, and the franc immediately rose from 50 to 40 to the American dollar. Poincaré was the statesman who dealt with France's financial crises in both 1924 and 1926. In the first quarter of 1924 the international exchange situation had already caused a financial crisis in France, and Poincaré met it with adroit moves on the money market and a 20 percent increase in indirect taxes. That is the episode Romier means when he recalls the recovery of March 1924. His claim that buying francs had turned into a herd-like rush by the public on 4 November is his own reading of the Bourse, not an established market statistic.
From the 1926 rise to de facto stabilisation and the 1928 devaluation
The danger Romier described, speculators betting on an ever-higher franc, bore on the central question of how far the currency would be allowed to climb. Poincaré's taxes, spending cuts and higher interest rates produced a budgetary surplus and an exchange rate of 25 francs to the dollar. He also wanted to avoid the mistake of Winston Churchill, who as Chancellor of the Exchequer had restored sterling to its 1914 level and badly hurt British exports. After the spring 1928 elections he decided to devalue and fix the official rate at the level at which the franc had been stabilised in 1926, roughly 125 francs to the pound and 25 to the dollar. The legal stabilisation of 1928 thus set the franc at one-fifth of its prewar value and confirmed the rate at which the franc had been stabilised in 1926, rather than the higher rate a continued speculative rise of the kind Romier described would have pointed to.
Coty's case for an understanding with Germany and the Locarno settlement
Coty's editorial claims that Le Figaro had backed an understanding with Germany when doing so took courage, and that the Versailles map could no longer be fully enforced because the Allies were divided. These are the paper's own assertions about its record and about Europe. The diplomatic setting is clearer. In the Locarno main treaty of late 1925, the five western European signatories guaranteed the inviolability of the German-French and German-Belgian borders, but Germany gave no guarantee of its eastern border, leaving it room to seek revision of Versailles. The most notable result was Germany's admission to the League of Nations in 1926. Aristide Briand signed at Locarno as French foreign minister and is remembered as the man of Franco-German rapprochement. Coty's remark about Allied divisions echoed a real gap: British interwar foreign policy differed radically from France's, since Britain sought to restore Germany as a peaceful, prosperous nation.
Who "General Pinard" was and why Prohibition drew French jokes
The hawker's "General Pinard" is a personification of pinard, the low-quality red wine that the French army began issuing as a daily ration as early as September 1914. Pinard and the poilu stayed ever-present in French popular culture during and after the war, so passers-by in Paris would have caught the joke at once. France had its own worries about alcoholism, but in the interwar period the issue never reached the scale it had in the United States. National Prohibition had taken effect there on 17 January 1920, and by the mid-1920s New York had become the headquarters of political resistance to it. In 1926 a New York anti-vice campaigner still said Prohibition could not be undone, despite widespread evidence of its failure. The item does not say which American event the hawker was celebrating; it records only a street joke and the paper's judgment that the American dry regime was unpopular in France.
Original
La hausse du franc
Hier, pour la première fois, le mouvement de spéculation à la hausse du franc qui se développe depuis quelques semaines, a entraîné une fraction assez large de la clientèle boursière. On sait que tout l'art de la spéculation consiste, par un amorçage plus ou moins prolongé, à déclencher l'afflux grégaire qui laissera les spéculateurs libres de faire charlemagne ou de poursuivre leurs chances à moindres risques. Nous assistons au début d'une panique renversée, tout à fait semblable à celle qui suivit le rétablissement du franc en mars 1924.
PRUDENCE ET LOGIQUE
A l'époque où il y avait quelque courage à le faire, nous nous sommes prononcés nettement pour une entente avec l'Allemagne, en commençant par des accords économiques; nous avons dit tout le bien qui en résulterait pour la paix du monde; nous avons aussi reconnu la difficulté de maintenir la délimitation des Etats européens et de leurs domaines coloniaux telle que l'a tracée le traité de Versailles, dont l'exécution complète est rendue désormais impossible par les divisions entre Alliés.
Voix du peuple.
Le régime sec américain n'est pas populaire en France. Hier, un camelot, radieux, en criant un journal du soir, ajoutait: «Grande victoire du général Pinard en Amérique!» Et l'on voyait que le brave homme exaltait ainsi la victoire de «son» général.