"A second line of defense is the U.S. Exchange Stabilization Fund. This Treasury Department fund is authorized to deal in gold and foreign exchange to meet our obligations under the Bretton Woods Agreement regarding orderly exchange rates. Typically, transactions are in the form of currency swaps (we trade U.S. dollars for Korean won) and no budget outlays occur. Secretary Rubin has discretion to use the Exchange Stabilization Fund without getting approval from Congress. Therefore no "scoreable event" occurs. The fund is classified, for budget purposes, as a mandatory program rather than a discretionary one, and therefore would be subject to PAYGO rules. However, since no legislation is involved and no outlays are likely to occur, there would be no PAYGO impact or change in the deficit. (For details about the fund, see page 848 of the President's Budget for Fiscal Year 1998, Appendix.)" concordcoalition.org
Most USA citizens hadn't heard of this ESF either until Mexican Bailout. What a hue 'n cry echoed throughout t'land when it was used, a measly $20B worth to prop them up...
Yes, it exists. Yes, some of us know it.
Thanks to your post & URL, now maybe more folks do! Good Work!
O/49r |
