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Book Reviews

Sympathy for the Devil: theWarburgs and the ruin of the Westby David Goldman

queathed to us. Attali himself is a fanatical malthusian,and

A Man of Influence: The Extraordinary
Career of S.G. Warburg
by Jacques Attali
Adler and Adler, Bethesda, 1987
$22.50 hardbound, 380 pages with index.

he fairly drools over the prospect.
Surviving Sir Sigmund as chief of the Warburg dynasty
is his cousin, Eric Warburg of Hamburg, who figures inAttali's account as a minor character. The late Stefan Pos­
sony, an Hungarian emigre turned senior U. S. intelligence
officer, told this reviewer before his death of his 1945 assignc
ment to interrogate Eric Warburg----'then a lieutenant colonel

How did our monetary system get into this godawful mess?

in U. S. intelligence assigned to debrief the Nazi hierarchy­

Important pieces of the jigsaw puzzle appear in Jacques At­

on the Warburg role in the Bolshevik Revolution. U. S. mil­tali's biographyof Sir Sigmund Warburg, in fact a collective

itary intelligence files, Possony repOrted, showed that Eric'sbiography of the Warburg family. We learn much a bout whofather Max, at the family bank in Hamburg,and Eric's uncle,

financed Hitler's economic czar Hjalmar Schacht, and recon­

the financial attache at Germany's Stockholm embassy,con­structed his team after the war; how the United States wasduited the foreign ministry funds to Lenin which financed theswindled into turning the international lending markets overNovember 1917 Bolshevik coup. Eric, a bank trainee in histo the London Eurodollar operators; and how hundreds oflate teens, was a witting participant, according to Possony's

billions of "contraband dollars " came to dominate the world

files.

monetary system, out of the control of national governments.

Possony's interview with Eric Warburg produced noth­

M. Attali, French President Mitterrand's economic ad­

ing. Possony complained long afterward, " He wouldn't say

viser, had privileged access to the late Sir Sigmund War­anything. " Attali' s book provides devastating,if circumstan­burg's personal papers, and an insiders' knowledge of post­

tial, evidence, of what Possony was looking for,namely,thewar banking. He corroborates in detail, numerous allegations

continuity of banking networks associated with the so-called

and conjectures made by the editors of EIR in the 1986 best­

Anglo-Soviet Trust into the postwar period. We will tum toseller Dope, Inc.,' in a way EIR could not. His own warped

this in a moment.

sympathies are summarized in a concluding eulogy to Sir
Sigmund:During 1982 and 1983, this reviewer talked with Eric
Warburg twice at his Hamburg bank, and numerous times by"The catalyst of a revolution that overtook him, a sensor

telephone. Warburg, at the time, was among the most pow­

for the madness of this century, an austere adventurer, a bolderful men in West Germany. Then- Chancellor Helmut

man and an old sage, he had been at the heart of the insanities,

Schmidt, who spent two weeks' summer vacation each year

one of the few men of influence in this century-in the end,on Warburg's yacht in the Baltic, was in the habit of re peatinga man of charm. It could be said that Sigmund Warburg was

Warburg's counsels verbatim in public policy addresses. His

the best that Europe and the Jewish people have given ourpowers failing, the 83-year-old banker reminisced about histime. " We will address the anti- Semitism implicit in thatfamily's history; he cited with special pride an incident notcomment below.
The "insanities "Attali refers to include "extensive social,reported in published sources. Queen Christina of Sweden,
upon her defection to the Catholic faith and her abandonment

financial, and military disasters, " in which "American banksof the Swedish crown in the middle of the 17th century,had. . . will be put under federal protection or indeed be nation­

been hidden for a period of months in the Hamburg area by

alized, " or even that "America defaults on its de bt. " Thenhis, Warburg's ancestors. "That was when your family was"gambling, speculation, the irrational and politics will be thestill called, 'del Banco,' "I offered� Warburg shouted, "Wholaw of the world " which Warburg, who died in 1984, be-told you that?" and closed the inter!View.

EIR

December 4, 1987

Economics© 1987 EIR News Service Inc. All Rights Reserved. Reproduction in whole or in part without permission strictly prohibited.

11

Eric Warburg's touchiness about something which canbe found in published sources, reflects on the two principal
omissions in Attali's account: They concern Venice and Mos­
cow. The great net of intermarried Jewish banking names as

Benedictine monasteries to exchange gloom with the West'schampion world-haters.
Perhaps he had a right to be pessimistic. After all, heknew what he was up to.

Warburg, Rothschild, Oppenheim, Mendelssohn, Schiff,S.G. Warburg left Germany in 1933 after an argument

Loeb (which Attali describes), and less famous but morewith his uncle, Max, whose touching faith in his intimate

important ones, such as David-Weill of Lazard Freres (whichfriend Hjalmar Schacht convinced him that he would be pro­

Attali does not), had its origins in the Venetian absorption oftected, while Schacht's economic policies created the Nazi

Sephardic Jewish banking families no later than the expulsion

death-camp economy. Max Warburg objected not to Schacht'sfrom Spain in 1492. But they remain Venetian today, anddeath-camp policies, merely to sending the Jews in first. He

that is the secret of their tie to Moscow. Our allegation has

had been instrumental,not merely in bringing Schacht backbeen that the Venice-centered "Trust" network of Count Giu­

to the Reichsbank, but had helped found the Bank for Inter­seppe Volpi di Misurata and his superspy Parvus remains

national Settlements in 1930, the institution which imposedintact; Attali provides scattered pieces of the puzzle, while

Schacht upon Germany in 1932 when it could not meet re­diverting attention away from the picture itself.

parations payments. Schacht proceeded to bring in Hitler, as

His account of Warburg origins mentions the family pres­the appropriate enforcer for his austerity plans.

ence in the Hamburg (Altona) area starting 1647, but (in line

Attali documents Max Warburg's position from War­with the standard myth) mentions no continuing Italian con­burg's own unpublished memoirs, suppressed by his family;

nection to a family which began in 14th-century Pisa as "delit would be interesting to know what else might be found in

Banco," i.e., "of the bank."

those memoirs. But he omits damning evidence that Max

Yet, Eric Warburg reported his family's role in the Jesuit

Warburg provided the seed-money for Europe's fascist

order's most successful covert operation against the Swedish

movements, through a 1924 donation of 50,000 gold marks

Lutheran princess whose father, King Gustavus Adolphus,to Coudenhove-Kalergi, the Austro- Venetian nobleman who

saved the Protestant cause in the Thirty Years' War before

founded "Pan-Europa" as an umbrella group to support thehis death at the first Battle of Liitzen in 1631. Evidently, theMussolini or Dollfuss variety of fascism on the EuropeanWarburgs, from their first days in Hamburg, were not merelyplane. As Lyndon H. LaRouche and I documented in The

a pseudopod of Venice-centered international banking, but

Ugly Truth about Milton Friedman ,2 Coudenhove's diaries

operated on behalf of Venetian intelligence, whose Contarini

express gratitude to Max Warburg as the great benefactor offamily had created the Jesuits a century earlier.

his movement.

"The history of the Warburgs is that of a Sephardic Jewish

Sigmund Warburg, meanwhile, eked out an inconspi­

banking family switching from the South to the North, "Attali

cuous living in London during the war, taking business thereports. It may be significant that (according to Attali's ac­

Rothschilds and others did not want. In 1945, the family hadcount) "Diego Texeira de Sampaio of Spain," an exiled Jew,

been reduced to a pimple on the posterior of the Allied pow­

"became financial adviser to Christina of Sweden; his soners, with no functioning bank bearing the family's name.

Manuel would later settle in Hamburg."
Attali belongs to that category of fascist given, unlike theYet, by the mid-1960s, S.G. Warburg and Co. had become
London's premiere merchant bank, and the center of a web

Nazis, to a certain philosemitic enthusiasm, because his ex­of alliances which set the trend for major developments inamination of these banking families has convinced him thatworld finance, Le., the slide toward the present catastrophe.

Jews have a special capacity for evil. But there is nothing

Apart from hailing to Sir Sigmund as a financial genius,

Jewish about Sigmund Warburg; his own world view, as

Attali can offer no better explanation than to refer repeatedly

Attali documents from hitherto-unpublished diaries, cen­

to Warburg's improbable "placing power," Le., the ability

tered on the German writer Thomas Mann, the great eulogizer

to find buyers for other peoples' securities, derived from hisof the Venetian principle, which the Germans call, Lust am

personal charm, and the network of contacts his family had

Weltuntergang, i.e., "pleasure at the destruction of the world"

built up for centuries. What precisely was the network? Start­(e.g., Death in Venice). Warburg could recite entire sections

ing 1973, S.G. Warburg's principal overt alliance was withof Mann's novel by heart. Financially and philosophically,

the Banque de Paris et des Pays-Bas, founded in the 1830s

Warburg and his ilk are Venetians. Attali portrays Sigmund

by the Venetian-Jewish de Comondo family, whose Banqueas a morbidly superstitious man, watching for omens, avoid­

Ottoman had dominated the finances of the Turkish Empire

ing numerologically ominous dates on the calendar, "alwaysfor the preceding century. Paribas, Warburg's partner just as

surprised to have lived another second, " contemplating (withthe Eurodollar boom exploded, holds a reported 12% of thethe great pessimist Mann) the end of civilization from his

equity of the great Venetian insurance and reinsurance cartel,monkish, austere vantage point. His principal philosophicalthe Assicurazioni GeneralL Through the reinsurance market,

discussion partner was the decadent Austrian writer Stefan

the Venice-based reinsurance cartel, including the giant Al­

Zweig, a double-suicide with his wife in 1940. He frequented

lianz Versicherung of Munich, dominates the trillion-dollar-12Economics

EIR

December 4, 1987

per-year flow of insurance premiums through the 80 largest

firm, had served in the Marshall Plan Paris of fice under the

insurance companies.

direction of Venetian banker Bruno Luzzatto]. Ball backed

The nature of the reinsurance business, as we reported in

him in the idea of winning support from President Kennedy

lends itself uniquely to the laundering of the $500

for European construction and enco�raged him to create ad­billion of narcotics revenues flowing each year through theditional financial markets for dollars outside the United

monetary system. With an unparalleled worldwide network,States."

Dope. Inc.•

the Venetian insurance cartel dominates the world market in

The result of these deliberations:came on July 18,1963,flight capital. Banks like S.G. Warburg's, which invented

when Kennedy announced an "interest equalization tax " onthe " Eurobond market, " provide the investment outlets.

loans contracted to foreigners in the United States. Sigmund" Eurobonds, " i.e., unregistered, offshore, bearer secu­rities, are sold to anonymous buyers, whose coupons areWarburg, who had concocted the idea along with GeorgeBall, proceeded take advantage:clipped through Swiss or Luxembourg trust accounts. They"In August, he made a tour of the main European central

have become a far more reliable means of hiding illegal funds

banks. In London, Bonn, Rome and Paris, he told each gov­

than numbered bank accounts, whose iron code of secrecy

ernor:

broke down under U. S. law-enforcement pressure. Theirissue volume last year exceeded $200 billion, almost fivetimes greater than the volume of ordinary international banklending.
Sigmund Warburg and his partner Gert Whitman (an aliasfor Gert Weissmann, Schacht's right-hand man at the NaziReichsbank) invented the " Eurobond " in 1962. "The lenders
were anonymous, which allowed for the investment of doubt­
ful capital and for interest to be received without payment oftax-which was what made the market successful. Some said
that former Nazis, the Ma fia, deposed rulers . . . found inthese issues an opportunity to launder their money, " Attalinotes.
But his most startling revelation reads as follows: "InWe can't let the whole international capital market
die just because New York closes. Companies must
be able to borrow without your having to create mon­ey. Anyway thse dollars will arise anyhow, because
only a reduction in the Ameri<fan payments de ficit
would make that
hap pen because instead of preventing the outflow ofdollars from the United States, the tax will, on thecontrary worsen it. Therefore, the best thing is foryou to allow the issue of long-term loans in dollars.
Besides, I have just done it a month ago in London
with the help of some of your �anks. Let them join
us in transactions of this kind.'"addition the Moscow Narodny Bank [the Soviet-owned bankThat confident prediction of failure came from the banker

in London] and the [ Soviet-owned] Banque de l' Europe du

who had sold the scheme to the United States in the first

Nord signed an agreement with the Commonwealth money

place! Warburg proceeded to gather "contraband dollars"

managers to invest some of the Soviet-held dollars in these

into the fold, in combination with such creative accountants

markets. Eurodollars were now buying Euro-issues. "as Robert Genillard of White Weld. During the 1970s andAll accounts of the origin of the Eurodollar market, i.e.,

1980s, S.G. Warburg's, through its subsidiary Mercury Se­

the offshore dollar pool whose volume now exceeds $3 tril­curities,became the dominant investment-banking power inlion, cite its curious origin in Soviet and Chinese dollar de­

the Hong Kong market, the main repository for opiates­

posits in European banks during the Korean War, to avoid

traf fic revenues, as, again, documented in Dope. Inc.

possible seizure of funds by the United States. "In the middle

As the Eurodollar market exploded out of control, theof the Cold War, it was the state banks of the U. S. S.R. andvalue of the pound sterling, and then the dollar crashed,

China that were making short-term loans of dollars to West­culminating in the 1971 suspension of U. S. gold payments.

ern Europe to finance its reconstruction. "The world was en route to the m.onetary disaster of thewe argued that the Soviets maintained an1980s, and the banking system had run out of the control

overseas fondo. an investment trust, with at least $50 butof the combined Western central banks. Attali's evidence,

perhaps $100 billion of resources, holding shares of Westernskewed as his presentation may be, convicts some of thecompanies through intermediaries. Our report that the War­

criminals who planned it that way;

In Dope. Inc.•burg family was among their principal money managers finds
corroboration from Attali.
However, Soviet financial resources in 1962 providedReferences1) Dope. Inc.: Boston Bankers and Soviet Commissars. byrelatively small change for the Eurobond market. The bigJeffrey Steinberg, David P. Goldman et. al. New Benjaminbucks came from the United States itself, thanks to War­Franklin House; New York 1986.

burg's friends in the Kennedy administration. " At the end of
the summer [of 1962] Sigmund went to Washington to see2) The Ugly Truth about Milton Friedman. by Lyndon H.

his friend George Ball, who had become assistant secretary

LaRouche, Jr. and David P. Goldman. New Benjaminof state [Ball, later to join the Lehman Brothers investment

Franklin House; New York 1980. 'EIR

December 4, 1987

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