Before 1914 it was sometimes asserted that the great European powers simply could not afford to go to war against one another. What Norman Angell called “the delicate interdependence of international finance” would either make war impossible, or, if war were attempted, would plunge Europe into such a deep economic crisis that it would quickly have to be abandoned. In 1899 the Polish banker and autodidact military expert Ivan Bloch described to his English translator what he believed would happen:

It was this vision of a financial crisis that the British Foreign Secretary Sir Edward Grey clearly had in mind when, invoking the memory of 1848, he warned his Russian counterpart in July 1914 of the dangers of a general conflagration. When war did break out, the immediate economic impact seemed to confirm these predictions. The Vienna stock exchange went first, slumping sharply as early as July 13, and within two weeks the crisis had spread to Berlin, Paris, and London. In London, the hub of the international monetary system, an acute liquidity crisis emanating from the acceptance houses threatened to force the Bank of England to suspend the convertibility of its bank notes into gold.