financial crises

   The most famous recent financial crisis was ‘Black Wednesday’, 17 September 1992. The collapse in the pound following tensions between Norman Lamont, Chancellor of the Exchequer, and the German Bundesbank led the Bank of England to raise interest rates from 10 percent to 15 percent, and then to devalue the pound and pull out of the Exchange Rate Mechanism. The incident was a considerable embarrassment to John Major’s Conservative government (see Conservative governments) and undermined Britain’s presidency of the EC. Lamont resigned the following spring. Previous crises of different proportions were: the oil crisis of the mid-1970s, which followed from a threefold increase in the price of oil imposed by OPEC (Organization of Petroleum Exporting Countries) and led to the three-day week from January to March 1974. In 1979 there was the Winter of Discontent, marked by high levels of strikes and industrial unrest. Lastly, in 1986, there was the Big Bang on 27 October, the day the stock exchange was deregulated; this caused great financial upheaval both before and after, right up to Black Monday a year later, Britain’s taste of a global financial crash.

   PETER CHILDS