25. Transcript of a Telephone Conversation Between West German Minister of Finance Schmidt and the President’s Assistant for National Security Affairs (Kissinger)1

S: This is Helmut Schmidt speaking.

K: Hello, Helmut. How are you?

S: Very good of you to call back, Henry. Oh, I am fine. I just left the hospital.

K: Are you at the hospital?

[Page 102]

S: Yes.

K: I saw a picture of you attending a Ministers meeting yesterday.

S: In order to do so I left the hospital, but I am not out of the hospital.

K: Uh-huh.

S: Henry, I call upon you because I remember a conversation back in October last year when we said I should call upon you when monetary problems tend to become political problems.2

K: Absolutely.

S: Henry, I’ve been with this now______ the danger. You will have recognized that within the last few days the dollar was weak at all the exchanges all over the world.

K: Right.

S: There are different reasons for it. I think generally speaking and basically speaking the pound value of the dollar is now okay but there are a number of psychological factors working against the dollar. Among these factors is also an official statement of your Administration that the United States Administration would not do anything in order to maintain the value of the dollar—would not intervene, in other words. I had a conversation over the telephone with George Shultz.3

K: Yes, he told me about it.

S: Pardon?

K: He told me about it.

S: And he will come to Europe on Friday.4 I am very happy that he decided to go to Europe. But what I would want to explain to you is that I think it would really be worthwhile if the United States would undertake an effort to show that they will participate in the attempt to defend the new system of ______ which we have found upon my return.

K: In other words, you would favor American intervention?

S: Yes. And I think it is not only Germany who would favor it.

Of course, we would have to borrow the money from the American ______.

K: That’s right.

S: But I think there is a danger of an uneasy feeling vis-à-vis the United States all over Europe now.

[Page 103]

K: Yeah, I understand. But how about the common float?

S: I think at the present the common float has a probability of less than 50%.

K: Uh-huh.

S: It will not be decided before funding it.

K: Which would you prefer?

S: We will have to wait for second day—election day in France. K: Which would you prefer?

S: I would prefer the ______ of the common float of the ______ countries and this is also with preference of Willy Brandt. But we have grave difficulties not only with the British and the Italians but also difficulties with the French.

K: Well the problem is this: If you cannot organize a common float you then want us to intervene.

S: I think in any case you should intervene even if we did organize. I think it necessary for the United States to give the impression to the Paris (?) trade partners that there really ______ situation to be a serious loss. And not just because they are foreigners, you know.

K: And we should intervene when—this week, or next week?

S: Uh, next week.

K: Next week.

S: The exchanges are closed all over the world (board)? here this week.

K: Yeah, of course. All right, Helmut. Let me—we’ve been discussing this and frankly we’ve been waiting for some requests of this kind.

S: Yeah.

K: We didn’t want to originate it.

S: Well, I understand this. On the other hand, please do understand that I was at the hospital until yesterday, so I was not able to operate.

K: All right, let me call you later this week.

S: Okay.

K: I will call you Wednesday.5

S: Okay.

K: And you can be sure that this will be taken very, very seriously.

S: Thank you very much.

K: Where should I call you—in Bonn or in Hamburg?

[Page 104]

S: I will be in Bonn on Thursday.

K: I will call you Thursday in Bonn.

S: Very good.

K: And I really have missed talking to you. I have always been out of the country when you’ve been over here.

S: Yes, well this is the enormous hectic life, isn’t it?

K: Well, we will rectify it during this year.

S: You have been very successful the last few months, haven’t you?

K: Well, let’s see how long it lasts. But I think we did all right.

S: We only brought about this new realignment, but it lasted only a fortnight.

K: (laughs) Well, it will last longer than that.

S: (laughs) So do I.

K: Okay. Talk to you soon.

S: Okay. Goodbye, Henry.

K: Goodbye, Helmut.

  1. Source: National Archives, Nixon Presidential Materials, Kissinger Telephone Conversations, Box 19. No classification marking. All blank underscores are omissions in the original. Kissinger was in Washington; Schmidt was in Germany.
  2. Not further identified. Kissinger and Schmidt met on July 20, 1972, and discussed international monetary affairs; see Foreign Relations, 1969–1976, volume XL, Germany and Berlin, 1969–1972, Document 370.
  3. Shultz’s name is handwritten in the omission in the original. See Document 24.
  4. March 9.
  5. March 7.