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The SA Reserve Bank (SARB) was created as a result of an earlier gold standard monetary crisis that unfolded after World War I. From 1919, South Africa nominally maintained the gold standard, but not the conversion of banknotes into gold. This article seeks to discuss the SARB's views on the gold standard controversy, and to highlight the different attitudes of the first two governors, Clegg and Postmus, attitudes that have not previously been examined in the literature. It will also discuss the way in which the Bank of England misled Clegg, and how the views expressed privately differed from those in the SARB's Ordinary General Meeting (OGM) documentation. This paper considers the irony that Clegg was selected from the ranks of the Bank of England and was loyal to Threadneedle Street, but defended a monetary policy which aided one of the biggest constituencies of the Afrikaner Nationalist Party – Afrikaner farmers. By contrast, Postmus was previously at the Nederlandsche Bankvoor Zuid-Afrika, and supported the National Party position that South Africa should return to, and remain on, a gold standard independent of Britain. Despite this, Postmus's policy turned out to be disastrous for the mostly Afrikaner farmers affected by the 1931–1932 crisis. [ABSTRACT FROM AUTHOR]

Although enjoying some de jure independence, South Africa in the year of the SARB's establishment, 1921, was by no means a de facto independent country, being tied in important ways to Britain. However, by the end of the First World War, it was clear that British imperial power was on the decline almost everywhere. As the British real economy declined, the power elite in Britain had begun to focus its attention on maintaining London as the centre of the world's financial system, painfully aware that the financial sector was the last sector of the economy in which Britain still maintained some level of relative dominance. It is in this global context that a naturalized British expert, Mr (later Sir) Henry Strakosch, was appointed by the 'pro-British' Smuts government to advise on various monetary issues in South Africa, including the establishment of the South African Reserve Bank. Later, upon its establishment another Briton, Clegg, was appointed its first Governor. In contrast the Pact government headed by Smuts rival, Barry Hertzog, later appointed an American and a Dutchman to lead their commission of enquiry into monetary questions. This research review seeks to throw some light on the first of these 'foreign' experts, Henry Strakosch. So who was Strakosch and why did he have such an enormous impact on South African monetary policy? [ABSTRACT FROM AUTHOR]