Eighty Years Ago This Week

  Thirty tonnes of gold then worth $32m  was returned from Frankfurt to the Hungarian National Bank in Budapest. It  had been held by the US Army which had taken it (with Hungarian agreement) from  a Benedictine abbey in Austria to which it had been smuggled by train in January 1945 to hide it from the German and Soviet armies. This allowed the Hungarian government to bring to an end the hyperinflation which had ravaged the economy for months.  The Pengo was abolished as a currency and replaced by the Forint, backed by gold.   The Tribunal set up as part of the Coal Industry Nationalisation Act ruled that the former owners of Britain's coal mines should receive the then colossal sum of £164m (4% of all government expenditure) in compensation for their assets. The industry was chaotic and badly in need of rationalisation and investment; the mine-owners were getting a bargain. The British government asserted the integrity of Austria, then occupied by th...

  The foreign ministers of the victor powers decided that Italy should retain South Tirol which it had been awarded in 1915 as a reward for joining the Entente powers fighting Germany and Austria-Hungary in the First World War. It had been formally annexed in 1920. The region had never belonged to any Italian political entity before, had no Italian culture and spoke German or Ladin; the Fascist government had imposed italianization. The Italian name by which the area is known, Alto Adige, is an invention although the new administrative unit includes the historically Italian Trentino region to the south. By all the principles of the Atlantic Charter it should have been returned to Austria but Italy switched sides to join the allies in 1943 as the monarchy's only way to survive, but the Austrian state had vanished in 1938 and was being reconstructed according to the wishes of the victor powers. Italy was once again being rewarded for an unprincipled diplomatic choice. Protests in the...

  The wing of the King David Hotel in Jerusalem which housed the headquarters of the British authorities in Palestine was destroyed by massive bombs planted by Jewish insurgents killing 91 people mostly working for the authorities, British, Palestinians both Arab and Jewish and other nationalities. The supposed purpose was to destroy documents seized in the massed raids of Operation Agatha which connected the Jewish Agency with violent acts, but it served more as simple retaliation. Ambiguous and garbled warnings were issued beforehand. Despite protests from the baking industry, public hostility and political opposition the British government implemented  its scheme to ration bread. Bakers were warned publicly that they would be punished if they did not comply. Bread had not been rationed even during the darkest days of the war and the move was emblematic of the sacrifices demanded by the Labour government. The scheme was immensely detailed and bakers were banned from selling ...

  The US Senate approved the bail-out loan to Britain and it was granted. Not only had US law-makers been at odds over the loan but the State and Treasury Departments had been opposed. The $3.75bn (£2.2bn) loan was presented as cheap money given the 1.62% rate of interest, but, unremarked at the time, one of the terms set the headstone on the grave of Britain's status as a financial superpower. Britain agreed to allow "sterling balances" held in London to be converted freely into other currencies after a year. This money totalled  £3.5bn and had mainly been deposited by the countries of the British Empire, notably India and Egypt. Within twelve months Britain faced the prospect of having to pay out in foreign currency (in practice US dollars) one and a half times what it had just borrowed. Intentionally or otherwise, US largesse worked hugely to the benefit of Britain's former possessions. The US accepted the British proposal to the conference on the German peace trea...

  Designer Louis Reard presented a two piece swimsuit to the world at the Piscine Molitor in Paris. No established catwalk model would take the risk of appearing in such a revealing item and it was worn by a nude dancer from the Casino de Paris, Micheline Bernardini. A competing designer had launched a two-piece swimsuit a few weeks before under the name "Atome" with the copyline, "the world's smallest swimsuit." Reard baptised his creation the bikini after the site of the atom bomb test a few days before and promoted it with the line "smaller than the smallest swimsuit." The name stuck and Bikini Atoll, now uninhabitable and unproductive because of radiation contamination, is largely forgotten.   The Hungarian economy had been ravaged by severe inflation since the end of the war and this developed into hyper-inflation far worse than experienced in Weimar Germany in 1923. At its worst prices were doubling in about fifteen hours. A banknote of 100 quint...

  In order to test whether military ships could survive a nuclear explosion Operation Crossroads was staged at Bikini Atoll in the Pacific. It might also have been intended to serve as a warning to the Soviet Union. The fourth nuclear bomb ever to be detonated exploded in the midst of some 95 warships. The test had been announced in advance and international observers including Soviet scientists were invited to attend. The bomb missed its aiming point and only five ships were sunk outright although nuclear contamination meant that almost all the survivors were useless. The Soviet Union made the first serious use of its veto at the UN Security Council when it turned down a statement on Franco's Spain which it deemed was too gentle. The Soviets sought an outright call on members to cease diplomatic relations with Spain. The resolution thus passed to the General Assembly. In response to the Night of the Bridges attacks the British authorities in Palestine launched Operation Agatha, th...