Before World War One, foreigners invested more money in the United States than Americans invested in other countries -- about three billion dollars more. The war changed this. By nineteen nineteen, Americans had almost three billion dollars more invested in other countries than foreign citizens had invested in the United States.
American foreign investments continued to increase greatly during the nineteen twenties.
Increased foreign investment was not the only sign of growing American economic power. By the end of World War One, the United States produced more goods and services than any other nation, both in total and per person.
Americans had more steel, food, cloth, and coal than even the richest foreign nations. By nineteen twenty, the United States national income was greater than the combined incomes of Britain, France, Germany, Japan, Canada, and seventeen smaller countries. Quite simply, the United States had become the world's greatest economic power.
America's economic strength influenced its policies toward Europe during the nineteen twenties. In fact, one of the most important issues of this period was the economic aid the United States had provided European nations during World War One.
Americans lent the Allied countries seven billion dollars during the war. Shortly after the war, they lent another three billion dollars. The Allies borrowed most of the money for military equipment and food and other needs of their people.
The Allied nations suffered far greater losses of property and population than the United States during the war. And when peace came, they called on the United States to cancel the loans America had made. France, Britain, and the other Allied nations said the United States should not expect them to re-pay the loans.