Thanks to GATA's friend D.H. for calling attention to an article,
"The Sieve of Gold," from the May 1968 edition of the late magazine
Ramparts --
http://en.wikipedia.org/wiki/Ramparts_%28magazine%29
-- which describes the longstanding U.S. government policy to push gold
out of the international financial system in favor of the U.S. dollar; the
increasing recognition by other nations that this constituted imperialism and
made the dollar in effect a tax on the world; the collapse of the London Gold
Pool; and the underlying cause of the enormous stress on the world financial
system at that time, the Vietnam War.
The author of the article, Michael Hudson, who recently had been an analyst
for Chase Manhattan Bank and now is professor of economics at the University
of Missouri at Kansas City, writes: "America's desire to see gold
eliminated from the world's monetary system is understandable. It had used
gold as a lever with which to exercise world power, not only to purchase
foreign businesses but also to finance its overseas Cold War operations.
Gold, America perceived, was power; as long as gold was the basis of the
world monetary system, power followed it. Therefore, when its gold stockpile
was depleted, America naturally wanted to transform the monetary system in
such a way as to phase gold out, thereby preventing any other nation from
using the power it provides -- especially in view of the fact that the major
potential gold-bloc nations are the Soviet Union, South Africa, and
France."
Hudson's biographical entry at Wikipedia shows that in the nearly five
decades since 1968 he has done much work elaborating on the imperialism of
the dollar system:
http://en.wikipedia.org/wiki/Michael_Hudson_%28economist%29
While the London Gold Pool is no more, it has been replaced by the far
more sophisticated U.S.-backed gold price suppression system of gold leasing
by Western central banks and high-frequency trading by their bullion bank
agents in the gold market. The U.S. national strategy, the defense of the
dollar as the imperial currency controlling the world, remains unchanged.
GATA's own summary of that strategy and some of the developments in its implementation
since 1968 is posted here:
http://www.gata.org/node/14839
Hudson's "The Sieve of Gold" has been posted in PDF format at
GATA's Internet site here:
http://www.gata.org/files/RampartsMay1968-SieveOfGold.pdf
