boatloads of american gold reserves were sppedverseas.protect the american banking system, toreserve confidence in the dollar based on the gold standard herbert hoover directed the federaresee system to make changes,changes that would "keep the american dollar ringing true in every city in america and in the world." the fed responded by raising its discount rate foinerananksusup ratof ieres paid to their depositors. the result -- foreign investors earned more interest and were enticed to leave their money in u.s. nks. the strategy worked. confidence in the dollar was restored and the gold drain was plugged. but there were other more serious ramifications. dr. edward bernsinformer principal economist u.s.asury departme. britain was the most important ading country inhe world. if they let the value ofrling ll, say, lative to e arand the franc, it meanthat britain would exporting muchore and importing muchess.weou be losiorts the btish and weould be swampedbyritish goo. ouers,ho were alreadyvi gat difficulty, suddenlyere confronted with a bi