In 1973, this French Navy warship steamed into NYC, guns out, to haul away tons of America’s gold.
In her wake, the global economy was changed forever. 🧵
In her wake, the global economy was changed forever. 🧵
The French frigate De Grasse quietly docked, crew crisp in dress uniforms. Below decks?
Empty space soon to be packed with crates worth hundreds of millions.
Empty space soon to be packed with crates worth hundreds of millions.
This wasn’t a heist. It was the legal, deliberate execution of a plan Charles de Gaulle set in motion years earlier: trade in France’s reserve of U.S. dollars for physical gold.
Why? De Gaulle didn’t trust America’s “gold window.” Under the Bretton Woods system, foreign governments could swap dollars for gold—but the U.S. had been printing dollars far faster than it could mine gold.
In 1965, de Gaulle basically called the U.S. bluff. “We consider that international trade should be established on an indisputable monetary base… which does not bear the mark of any particular country.” Translation: send gold, not paper.
It wasn’t the first or last time the most famous French general since Napoleon questioned US monetary policy. He had a long history of questioning every American policy:
history.upenn.edu/sites/default/…
history.upenn.edu/sites/default/…
As outlined in the above paper from ’65 and ’71, France (and others) kept redeeming dollars for gold. This drained U.S. reserves from over 20,000 tons to under 9,000. The Nixon administration saw the writing on the wall.
On August 15, 1971, Nixon slammed the “gold window” shut—no more dollar-for-gold redemptions.
But France had already locked in a final massive withdrawal, and de Gaulle didn’t send a cargo ship. He dispatched the French Navy to get it.
The gold was weighed and crated the French Sailors and armed Marines guarded the shipment as they rolled out of the New York Federal Reserve and onto the De Grasse.
It was the last great shipment of U.S. gold to a foreign power.
It was the last great shipment of U.S. gold to a foreign power.
The US would have probably left the gold standard eventually but de Gaulle forced Nixon’s hand by sending a warship instead of diplomats to find a compromise solution.
That moment marked the symbolic end of America’s gold standard dominance and the beginning of the fiat dollar era we live in today.
And it allowed the Federal Reserve and congress to “print money” at will.
And it allowed the Federal Reserve and congress to “print money” at will.
Of course, “printing money” isn’t literally firing up presses—it’s creating dollars digitally, expanding credit, and inflating the money supply.
And the US navy could have easily stopped de Gaulle’s ship from entering NY harbor if ordered.
And the US navy could have easily stopped de Gaulle’s ship from entering NY harbor if ordered.
Without gold backing, the only real limit is political will—and history shows that’s paper-thin. By the time the French Navy returned to NYC for America’s bicentennial, Wall Street had already accepted the surrender.
Over the next decade some on Wall Street even celebrated the French’s victory over Bretton Woods
Next time you hear about “sound money” debates, remember: once upon a time, the French Navy literally sailed a warship into NYC to take America’s gold.
And we let them.
And we let them.
P.S. And this isn’t even the craziest or most consequential story about American gold ships.
For that story I suggest reading this book:
amzn.to/4fza2U1
For that story I suggest reading this book:
amzn.to/4fza2U1
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