Made in Germany : the German currency crisis of July 1931

was international and carried the argument further. His account focused on currency
problems and failures of omission by governments outside Germany.
James presented quite a different story with much more attention to internal
German problems. He represented the crisis as a run on German banks that contained
"structural weaknesses" and were "fundamentally unsound." The main cause of
instability, in other words, was internal to Germany. The small push that toppled this
unsound structure, however, was the withdrawal of foreign deposits, primarily American.
International aspects were important in this story, but secondary if the crisis was the result
of unsound German banking. Any push would have toppled this weak edifice. 8
In addition, James argued that the Americans were not to blame for pulling their
funds, as the Americans claimed at the time. Instead, the Germans had brought the crisis
on themselves by tolerating capital flight in 1930-31 and by mismanaging their debt.
James agreed with this American view without detailing the nature of the purported debt
mismanagement. He only introduced it into his narrative of the crisis at the last moment,
arguing that the budget crisis surfaced on June 9 when revenue figures for April and May
became available, that is, at a late stage of the crisis. 9 In contrast to Kindleberger's and
Eichengreen's story of international contagion, James' story concerned German banks in
a context of government financial problems. His domestic story tracked Kindelberger
more than Eichengreen (who wrote after James) in its emphasis on banking problems, and
he consequently ended up distributing blame to both private and public parties.
Balderston attempted to disentangle the banking and currency crisis even as he
asserted both were present. He argued that the proximate cause of the crisis was a general
run on bank deposits due to conflicts over Reparations and fiscal crises. The ultimate