The Exchange Stabilization Fund with Rob Kirby - March 9th
“The
important thing to know about an assassination or an attempted
assassination is not who fired the shot, but who paid for the bullet” ~
Eric Ambler
The
Exchange Stabilization Fund (ESF) is a fund managed by the New York
Federal Reserve and its member banks acting as agents for the US
Secretary of the Treasury. The fund is free of Congressional oversight,
with broad authority to intervene in currency, securities, and
commodities markets.
The
fund was created by the Gold Reserve Act of 1934. The act required that
all gold and gold certificates held by the Federal Reserve be
surrendered and vested in the sole title of the US Treasury. A 1970
amendment to the act allows the Secretary of the Treasury, with
authorization of the President, to use ESF funds to “deal in gold,
foreign exchange, and other instruments of credit and securities.”
Long-time
Solari Report subscribers are used to hearing me describe the ESF as
the “mother of all slush funds.” My favorite reference is at hand, from
Christopher Simpson’s excellent book Blowback: America’s Recruitment of Nazis and Its Effects on the Cold War:
“The
trail of this tainted money dates back to 1941, when the War Powers Act
authorized the U.S.Treasury’s Exchange Stabilization Fund to serve as a
holding pool for captured Nazi valuables— currency, gold, precious
metals, and even stocks and bonds— seized as the Germans or other Axis
governments attempted to smuggle them out of Europe. The captured
wealth, which eventually totaled tens of millions of dollars, included
substantial amounts of blood money that the Nazis had pillaged from
their victims. Indeed, it was precisely this type of criminal booty that
overeager Nazis had most frequently attempted to export from Europe.”
“The
Exchange Stabilization Fund was authorized to safeguard the portion of
the Nazi hoard that had been uncovered and confiscated by the United
States in the Safehaven program, which sought to interdict the German
smuggling efforts. The official purpose of the fund was to serve as a
hedge against inflation and as a bankers’ tool to dampen the effects of
currency speculation in the fragile economies of postwar Europe and
Latin America.”
“In
reality, this pool of money became a secret source of financing for
U.S. clandestine operations in the early days of the CIA. The first
known payments from the Exchange Stabilization accounts for covert work
were made during the hotly contested Italian election. The CIA withdrew
about $10 million from the fund in late 1947, laundered it through a
myriad of bank accounts, then used that money to finance sensitive
Italian operations. This was the “black currency” that Cardinal Spellman
asserted was given to the Vatican for anti-Communist agitation.”
This
coming week, I will be in Toronto to attend the convention of the
Prospectors and Developers Association of Canada (PDAC) and visit with
Rob Kirby of
Kirby Analytics.
Rob will join me to discuss the Exchange Stabilization Fund and its
role at the intersection of the hidden system of finance, the black
budget, and the financial markets. Rob had a successful career in the
fixed income and derivatives markets working for global and Canadian
financial institutions before starting Kirby Analytics. He is one of the
most popular on line commentators today on the financial markets. Rob
is particularly knowledgeable about Exchange ESF role in the precious
metals markets. As we will discuss, following the gold price suppression
and other manipulations in the gold market invariably leads investors
to want to learn more about the ESF.
For Let’s Go to the Movies, Rob and I will discuss Eric deCarbonnel’s video briefing, “The ESF and its History.”
As
always, there is a lot to discuss on the latest developments in the
financial markets and geopolitics to in Money & Markets. Please make
sure to post or e-mail your questions for Ask Catherine.
Talk to you Thursday!
Catherine Austin Fitts
Just a Taste! - The Exchange Stabilization Fund with Rob Kirby
Just a Taste: The Exchange Stabilization Fund with Rob Kirby
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