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By Lars Schall
Saturday, January 29, 2011
Thanks to GATA consultant Dimitri Speck and U.S. economist James K. Galbraith, a
copy of the so-called Blessing letter, written on March 30, 1967, can be
published for the first time on the Internet. The letter's text refutes the
widespread assumption among German gold bugs that the letter promised the
U.S. government that the German central bank, the Bundesbank,
would never relocate the German gold reserve from New York to Germany as long
as U.S. troops were stationed in Germany. The letter has nothing to do with
the location of the German gold reserve.
Instead, the letter, written by the Bundesbank's president at the time, Karl Blessing, and
sent to the then-chairman of Board of Governors of the U.S. Federal Reserve
System, William McChesney Martin Jr., made this
important promise on behalf of the Bundesbank:
"By refraining from dollar conversions
into gold from the United States Treasury, the Bundesbank
has intended to contribute to international monetary cooperation and to avoid
any disturbing effects on the foreign exchange and gold markets. You may be
assured that also in the future the Bundesbank
intends to continue this policy and to play its full part in contributing to
international monetary cooperation."
Speck, author of the German-language book "Geheime
Goldpolitik" ("Secret Gold
Politics," about which more information is available at http://www.gata.org/node/9349),
puts the Blessing letter in context:
"In 1967 the Americans and British
threatened to reduce their troops in West Germany on account of the cost.
Because of the Cold War, West Germany wanted to avoid a reduction in military
forces but didn't want to pay more for those forces. Part of the resolution
of the issue was the Blessing letter, which confirmed Germany's waiver of
conversion of dollars into gold. Thus Germany, like other countries, bought
security by accumulating dollar claims as foreign-exchange reserve.
"The right of governments to convert
dollars into gold from the U.S. Treasury was canceled by the U.S. government
in 1971. But four years earlier the Blessing letter affirmed the formal
renunciation of the largest dollar holder, Germany, of conversions of dollars
into gold. The letter was thus an essential step toward the global dollar
standard, which was recognized already by the U.S. government and
communicated in internal documents."
The Blessing letter is archived at the
Lyndon B. Johnson Presidential Library in Austin, Texas. Because of his
research, Speck gave the decisive encouragement for its publication here.
Galbraith, a professor at the University of Texas in Austin and author of
"The Predator State," gave the decisive help in obtaining a copy of
the letter.
The Blessing letter can be viewed at GATA's
Internet site here:
http://www.gata.org/files/BundesbankLetter-03-30-1967.pdf
An article in German about this discovery
has been published simultaneously at the German Internet site Goldseiten here:
http://www.goldseiten.de/content/diverses/art...p?storyid=15325
And at the German Internet site Infokriegernews here:
http://www.infokriegernews.de/wordpress/20...rioese-brief...
-----
Lars Schall is a
freelance journalist based in Germany.
* * *
Chris
Powell
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