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Blast from the past: Charles de Gaulle calls for one world currency… Gold

Charles de Gaulle is a very important person to look at in terms of the modern history of gold. Here is an excerpt from Time magazine published back in 1965:

There was Charles de Gaulle last week proclaiming that the primacy of the dollar in international dealings was finished, calling for an eventual return to the gold standard –which the world’s nations scrapped 50 years ago — and practically inviting other countries to follow France’s lead and cash in their dollars for gold…

France converted $150 million into gold last month, plans another $150 million conversion soon. Following that lead, Spain has quietly exchanged $60 million of its dollar reserves for U.S. gold–the biggest such transaction of the Franco era. To free more gold to meet rising demand, a congressional committee last week approved President Johnson’s proposal to eliminate the 25% gold backing now legally required for deposits held in the Federal Reserve System.

This should all sound pretty familiar to what is going on today, countries asking for their gold back.

Back in the 1960s the dollar was still convertible into gold if you were a foreign country (the people lost convertibility in 1933). And this is exactly what de Gualle started doing.

He didn’t trust the USA to limit it’s money printing and instead of holding dollars demanded that the US ship back their dollars in converted gold to France.

It was this action that primarily caused Nixon in 1971 to end this convertibility to gold and ended any link at all between the dollar and gold.

Simply put France was about to take most if not all of the USA’s gold (because they’d printed that much), something the States were not going to let happen and so they essentially defaulted on their obligation to convert dollars to gold.

But it is this clip from 1965 of de Gaulle explaining his action that really caught our eye:

Transcript:

The fact that many countries accept as a principle dollars being as good as gold for the payment of the differences existing for their advantage in the American balance of trade. This very fact leads Americans to get into debt, and get into debt for free at the expense of other countires at least in part with dollars only they are allowed to emit. Considering the serious consequences a crisis would have under such a system we think that measures must be taken in time to avoid it.

We consider necessary that international trade be established as it was before the great misfortunes of the world on an indisputable monetary base, one that does not bear the mark of any particular country.

Which base?

In truth, who can see, how one can have any real standard critereon, other than gold?

A fascinating passage that is as relevant today as it was back then. De Gaulle was pointing out that if the US was allowed to emit dollars without limit (essentially ignoring their tie to gold) it will lead the Americans into debt.

And that is exactly what has happened in the US since the convertibly of gold was ended in 1971.

US debt 1965 2013 Blast from the past: Charles de Gaulle calls for one world currency... Gold   (click for sharper image)

Since that last vestige of a link between gold and the dollar was abandoned in 1971 the debt of the US has increased by 4000%.

And over that same time period what has happened to ‘growth’ (GDP)? 

US GDP 1965 2013 Blast from the past: Charles de Gaulle calls for one world currency... Gold  (click for sharper image)

That’s ‘only’ increased by 1350% – so just like de Gaulle predicted, without any backing to the dollar the US would start increasing its debt much faster than the growth of the country.

In fact the problems we see in the world to day, namely one of debt, can really be traced back to de-linking of gold in 1971. These problems take a long time to manifest and the current debt bubble has really been more than 40 years in the making – this is why it’s ridiculous to blame one political party or another, they’re BOTH to blame for not heeding de Gaulle’s warning.

Finally, the solution put forward to this problem by de Gaulle is worth repeating:

We consider necessary that international trade be established as it was before the great misfortunes of the world on an indisputable monetary base, one that does not bear the mark of any particular country.

This sounds a lot like for a call to have a one world currency – something that the powers that be still seem to have one eye on today. The difference though is what de Gaulle suggests that currency should be:

In truth, who can see, how one can have any real standard critereon, other than gold?

A global currency called ‘gold’, no there’s a novel idea!

Link to this article: : http://www.goldmadesimplenews.com/interviews/blast-from-the-past-charles-de-gaulle-calls-for-one-world-currency-gold-9455/

Posted by on Jan 17 2013. Filed under Interviews. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.
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