Friday, 15 July 2011

82nd Session of the Philosophical Foundations of Law and Finance (15 July, 6-8pm, room 516, University of Westminster, 309 Regent St, London)

Dear all,

Have you ever wondered why the world monetary system walks the path it does, a segment of which we are living in? Do you ever wonder whether there is indeed an invisible hand that "puppets" the world's monetary system and certainly not behaving in the pattern of the famous Adam Smith's invisible hand? Theories of the "invisible hand" have famously circled the world for hundreds of years either as part of scientific argumentation (e.g. the human drivers) or conspiracy speculations (e.g. clans of new world order). However not so known to the ordinary man, but at the same time so intriguingly powerful, comes the speculative statement that such an invisible hand exists and it is called the Exchange Stabilisation Funds (ESF). With its unaccountable authority to no one else, except from the President and the Secretary of Treasury, its hand on the gold reserves of the United States, its institutional influence on the world monetary policy (IMF, World Bank) and its legal authority to "....provide financing to foreign governments", among others, it is difficult to be sceptical about the supremacy of such a hand. 

Congress created the ESF with profits from the nationalization of gold—and adjustment of the gold standard for the dollar—in the early 1930s. With the passage of the Gold Reserve Act, the government stash increased in value by $2.8 billion; most of that money was then diverted into a new fund to help the Treasury manage the exchange value of the U.S. dollar in times of crisis by buying and selling foreign currencies without congressional approval.

ESF funds are devoted not solely for foreign exchange. The secretary can, with the approval of the president, use the money to "deal in gold, foreign exchange, and other instruments of credit and securities." (i.e. ANYTHING on securities market) 

Some sources to further intrigue our curiosity:

Afterwards can head for drinks at the beautiful bar at the Langham's hotel. See you tonight.


No comments: