Gold researcher Koos Jansen tonight calls attention to the minutes of a U.S. State Department meeting in April 1974 summoned by Secretary of State Henry Kissinger to consider the danger that the price of gold might get beyond the U.S. government's control.
The objective of U.S. policy about gold during this time has not been secret; GATA has cited government records demonstrating it. For example:
http://www.gata.org/files/ArthurBurnsLetterTo...rd-June1975.pdf
http://www.gata.org/node/12551
But the minutes published by Jansen tonight are especially remarkable for making explicit the U.S. government's recognition of what some gold advocates call "the golden rule" -- that is, whoever has the most gold makes the rules.
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The meeting is addressing what is perceived as the increasing desire among Western European countries to revalue their gold reserves upward, thereby increasing gold's role in the international financial system, while U.S. policy has been to demonetize gold so as to leave the U.S. dollar unchallenged as the world reserve currency.
Secretary Kissinger asks the meeting: "Why is it against our interest to have gold in the system?"
He is answered by his assistant undersecretary of state for economic and business affairs, Thomas O. Enders.
The minutes, found by Jansen in the State Department archives in Volume 31 of "Foreign Relations of the United States, 1973-76," record Kissinger's exchange with Enders this way:
* * *
Mr. Enders: It's against our interest to have gold in the system because for it to remain there it would result in it being evaluated periodically. Although we have still some substantial gold holdings -- about $11 billion -- a larger part of the official gold in the world is concentrated in Western Europe. This gives them the dominant position in world reserves and the dominant means of creating reserves. We've been trying to get away from that into a system in which we can control ...
Secretary Kissinger: But that's a balance-of-payments problem.
Mr. Enders: Yes, but it's a question of who has the most leverage internationally. If they have the reserve-creating instrument, by having the largest amount of gold and the ability to change its price periodically, they have a position relative to ours of considerable power. For a long time we had a position relative to theirs of considerable power because we could change gold almost at will. This is no longer possible -- no longer acceptable. Therefore, we have gone to Special Drawing Rights, which is also equitable and could take account of some of the less-developed-country interests and which spreads the power away from Europe. And it's more rational in ...
Secretary Kissinger: "More rational" being defined as being more in our interests or what?
Mr. Enders: More rational in the sense of more responsive to worldwide needs -- but also more in our interest. ...
* * *
So there you have it. Whoever has the most gold can control its valuation -- and implicitly the valuation of every currency -- and thereby create the most "reserves," the most money, money being power. The interest of the United States, at least as it was perceived at that meeting at the State Department in April 1974, was to dominate the world through the power of money creation.
Few observers would deny the success of that policy from 1974 and earlier right up to the present day. The current war over gold, a war raging nearly everywhere today except in the mainstream financial news media, which strive desperately to overlook it, is a war for world domination through the power of money creation. Whoever gets the most gold will control its valuation, control the valuation of other currencies, and make the rules for the international financial system.
The minutes of the April 1974 meeting at the State Department are posted at Jansen's Internet site, In Gold We Trust, here:
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http://www.ingoldwetrust.ch/minutes-of-...ng-on-gold-1974
