I have had the telegrams about it repeated to you. We have not entered the business without resolve to see it through and you may be assured that our action will be proportioned to the gravity of the need. I have absolute confidence in final result. No special action is required from you at present, but you should address your mind to a naval situation which may arise where Germans control Calais and French coasts and what ought to be the position of Grand Fleet in that event. I had not seen the Chancellor of the Exchequer, except at Cabinets, since the fateful Sunday before the war. I had been buried in the Admiralty and he in the Treasury. I sustained vague general impressions of a tremendous financial crisis—panic, bankruptcies, suspension of the Bank Act, moratoriums, paper money—like a distant tumult. I realised that he, aided by the Lord Chief Justice, Lord Reading, was riding the storm and regaining effective control of events. But I did not attempt to follow and appreciate the remarkable sequence of decisions by which an unprecedented, unimaginable situation was met. Now, however, with this fateful news, I felt intensely the need of contact with him, and I wanted to know how it would strike him and how he would face it. So I walked across the Horse Guards Parade and made my way to the tunnel entrance of the Treasury Board Room. It must have been about 10 o’clock in the morning and, as I opened the door, I saw the room was crowded. One of that endless series of conferences with all the great business and financial authorities of Britain, by means of which the corner was turned, was in progress. He saw me at once: I beckoned with my finger and he came out. We went into a little room scarcely bigger than a cupboard which adjoined, and I told him what had happened. I was relieved and overjoyed at his response. He was once again the Lloyd George of Agadir. Not since the morning of the Mansion House speech, three years before, had I seen him so strong and resolute for our country or so sure of its might. _First Lord to Commander-in-Chief Grand Fleet_ _August 25th, 1914._ * British retirement on French frontier successfully and skilfully effected. Army now in strong position, well supported. Our casualties reported not severe considering continued engagement with two German corps and two cavalry divisions. Enemy was well punished and lost heavily. Main battle has still to be fought. General impression better this morning. Hope all is well with you.