been abandoned as a global monetary system. Czechoslovakia, Belgium, France, the Netherlands and Switzerland abandoned the gold standard in the mid-1930s. According to Barry Eichengreen, there were three primary reasons for the collapse of the gold standard: Tradeoffs between currency stability and other domestic economic objectives: Governments in the 1920s and 1930s faced conflictual pressures between maintaining currency stability and reducing unemployment. Suffrage, trade unions, and labor parties pressured governments to focus on reducing unemployment rather than maintaining currency stability. Increased risk of destabilizing capital flight: International finance doubted the credibility of national governments to maintain currency stability, which led to capital flight during crises, which aggravated the crises. The U.S., not Britain, was the main financial center: Whereas Britain had during past periods been capable of managing a harmonious international monetary system, the U.S. was not. Causes of the Great Depression Economists, such as Barry Eichengreen, Peter Temin and Ben Bernanke, blame the gold standard of the 1920s for prolonging the economic depression which started in 1929 and lasted for about a decade. The gold standard theory of the Depression has been described as the "consensus view" among economists. This view is based on two arguments: "(1) Under the gold standard, deflationary shocks were transmitted between countries and, (2) for most countries, continued adherence to gold prevented monetary authorities from offsetting banking panics and blocked their recoveries." However, a 2002 paper argues that the second argument would only apply "to small open economies with limited gold reserves. This was not the case for the United States, the largest country in the world, holding massive gold reserves. The United States was not constrained from using expansionary policy to offset banking panics, deflation, and declining economic activity." According to Edward C. Simmons, in the United States, adherence to the gold standard prevented the Federal Reserve from expanding the money supply to stimulate the economy, fund insolvent banks and fund government deficits that could "prime the pump" for an expansion. Once off the gold standard, it became free to engage in such money creation. The gold standard limited the flexibility of the central banks' monetary policy by limiting their ability to expand the money supply. In the US, the central bank was required by the Federal Reserve Act (1913) to have gold backing 40% of its demand notes. Higher interest rates intensified the deflationary pressure on the dollar and reduced investment in