Britain's dollar and gold reserves dwindled through wartime purchases. By December 1940, most remaining funds were pledged to existing orders, leaving too little uncommitted money to continue cash-and-carry procurement at the required scale. Fixed war loans risked repeating the debt disputes that followed the First World War. Roosevelt used his hose-pipe analogy to present lending arms as a form of American self-defence. The accompanying interpretation argues that arming Britain cost less than replacing Britain in the war.
Chapter · 1:31:50-1:36:50
Cash-and-carry exhausted Britain's dollars
By late 1940 Britain had committed nearly all its liquid dollar resources, making the existing cash-and-carry system strategically unsustainable.