MR. JUSTICE JACKSON: Now, did you not make this answer to the interrogator’s question:
“Question: ‘But I am asking you whether during that period from 1 April 1938 to January 1939 you did not continue to finance armaments?’
“Answer: ‘Sir, otherwise these mefo bills had to be refunded by the Reich, which they could not be, because the Reich had no money to do it; and I could not procure any money for refunding because that would have had to come from taxes or loans. So I had to continue to carry these mefo bills and that, of course, I did.’ ”
Did you give that answer?
SCHACHT: Yes, that was quite in order—kindly let me speak, would you not—because the Finance Minister did not make his funds available for the repayment of the mefo bills, but instead gave them for armaments. If he had used these funds to pay the mefo bills, everything would have been all right.
MR. JUSTICE JACKSON: And you carried the mefo bills which let him use current revenues to continue the plans of rearmament after 1938, did you not?
SCHACHT: Mr. Justice, this was the situation. A large part of the mefo bills was already on the financial and capital market. Now, when that market was too heavily burdened by the government, then the people brought in the mefo bills to the Reichsbank, for the Reichsbank had promised to accept them. That, precisely, was the great obstruction to my policy. The Reich Finance Minister financed the armament instead of honoring the mefo bills as he had promised.
MR. JUSTICE JACKSON: Now, it was under those circumstances that you took a position which would result in your retirement from the Reichsbank?
SCHACHT: Yes.
MR. JUSTICE JACKSON: Now we come to Czechoslovakia. Did you favor the policy of acquiring the Sudetenland by threat of resort to arms?