Ownership by Freemason/Zionists Mafia
author: Alexander James – E-mail address
Source Portland Independent Media Center
Part 2. History of the Privately owned Federal Reserve System
From Chapter 1 & 10, The Creature from Jekyll Island by Edward Griffin and from The Secrets of the Federal Reserve by Eustace Mullins. (copy of the 1913 Federal Reserve Act below)
In brief, the private banking cartel known as the Federal Reserve System was setup in 1913 at the same time that the 16th Amendment was introduced to force income taxes onto Americans. The 16th Amendment was not legally ratified and this is why people are challenging the legality of income taxes that go to pay the interest on the money created from nothing by the private Federal Reserve System. The FED owners have become immensely wealthy by creating money out of nothing and lending it to the tax payers. Owners of the Fed are listed further down. The same scam happens with the Bank of England and HSBC, both controlled by the Freemason/Illuminati Zionist families (Rothschild, etc.).
The secret meeting on Jekyll Island (owned by J.P.Morgan) in Georgia (around 1910) at which the Federal Reserve was conceived and a roadmap was laid towards the birth of a banking cartel to protect its members from competition, and the strategy of how to convince Congress and the public that this cartel was an agency of the United States government. Seven men who represented an estimated one forth of the total wealth of the entire world were present at that meeting:
- Nelson W. Aldrich, Republican “whip” in the Senate, Chairman of the National Monetary Commission, business associate of J.P. Morgan, father-in-law to John D. Rockefeller, Jr.;
- Abraham Piatt Andrew, Assistant Secretary of the United States Treasury;
- Frank A. Vanderlip, president of the National City Bank of New York, the most powerful of the banks at that time,representing William Rockefeller and the international investment banking house of Kuhn, Loeb & Company;
- Henry P. Davison, senior partner of the J.P Morgan Company;
- Charles D. Norton, president of J.P. Morgan’s First National Bank ofNew York;
- Benjamin Strong, head of J.P. Morgan’s Bankers Trust Company;and
- Paul M. Warburg, a partner in Kuhn, Loeb & Company, a representative of the Rothschild banking dynasty in England and France, and brother to Max Warburg who was head of the Warburg banking consortium in Germany and the Netherlands.
These competitors colluded to create a banking cartel who collateral is the US taxpayer and all properties of the US government. In 1913, the same year that the Federal Reserve Act was passed into law, a subcommittee of the House Committee on Currency and Banking, under the chairmanship of Arsene Pujo of Louisiana, completed its investigation into the concentration of financial power in the United States. Pujo was considered to be a spokesman for the oil interests, part of the very group under investigation, and did everything possible to sabotage the hearings. In spite of his efforts, however, the final report of the committee at large was devastating.
It stated: Your committee is satisfied from the proofs submitted, even in the absence of data from the banks, that there is an established and well defined identity and community of interest between a few leaders of finance…which has resulted in great and rapidly growing concentration of the control of money and credit in the hands of these few men… When we consider, also, in this connection that into these reservoirs of money and credit there flow a large part of the reserves of the banks of the country, that they are also the agents and correspondents of the out-of-town banks in the loaning of their surplus funds in the only public money market of the country, and that a small group of men and their partners and associates have now further strengthened their hold upon the resources of these institutions by acquiring large stock holdings therein, by representation on their boards and through valuable patronage, we begin to realize something of the extent to which this practical and effective domination and control over our greatest financial, railroad and industrial corporations has developed, largely within the past five years, and that it is fraught with peril to the welfare of the country.
The purpose of this meeting on Jekyll Island was…to come to an agreement on the structure and operation of a banking cartel. The goal of the cartel, as is true with all of them, was to maximize profits by minimizing competition between members, to make it difficult for new competitors to enter the field, and to utilize the police power of government to enforce the cartel agreement.
In more specific terms, the purpose and, indeed, the actual outcome of this meeting was to create the blueprint for the Federal Reserve System.
On 23rd December 1913 the house of representatives had past the Federal Reserve Act, but it was still having difficulty getting it out of the senate. Most members of congress had gone home for the holidays, but unfortunately the senate had not adjourn sine dei (without day) so they were technically still in session. There were only three members still present. On a unanimous consent voice vote the 1913 Federal Reserve Act was passed. No objection was made, possibly because there was no one there to object.
The first leak regarding this meeting found its way into print in 1916. It appeared in Leslie’s Weekly and was written by a young financial reporter by the name of B.C. Forbes, who later founded Forbes Magazine. The article was primarily in praise of Paul Warburg, and it is likely that Warburg let the story out during conversations with the writer. At any rate, the opening paragraph contained a dramatic but highly accurate summary of both the nature and purpose of the meeting: Picture a party of the nation’s greatest bankers stealing out of New York on a private railroad car under cover of darkness, stealthily hieing hundreds of miles South, embarking on a mysterious launch, sneaking on to an island deserted by all but a few servants, living there a full week under such rigid secrecy that the names of not one of them was once mentioned lest the servants learn the identity and disclose to the world this strangest, most secret expedition in the history of American finance.
I am not romancing. I am giving to the world, for the first time, the real story of how the famous Aldrich currency report, the foundation of our new currency system, was written.
In 1930, Paul Warburg wrote a massive book – 1750 pages in all – entitled “The Federal Reserve System, Its Origin and Growth”. In this tome, he described the meeting and its purpose but did not mention either its location or the names of those who attended. But he did say: “The results of the conference were entirely confidential. Even the fact there had been a meeting was not permitted to become public.” Then in a footnote he added: “Though eighteen years have since gone by, I do not feel free to give a description of this most interesting conference concerning which Senator Aldrich pledged all participants to secrecy.”
In the February 9, 1935, issue of the Saturday Evening Post, an article appeared written by Frank Vanderlip. In it he said: “Despite my views about the value to society of greater publicity for the affairs of corporations, there was an occasion, near the close of 1910, when I was as secretive – indeed, as furtive – as any conspirator….I do not feel it is any exaggeration to speak of our secret expedition to Jekyll Island as the occasion of the actual conception of what eventually became the Federal Reserve System….We were told to leave our last names behind us. We were told, further, that we should avoid dining together on the night of our departure. We were instructed to come one at a time and as unobtrusively as possible to the railroad terminal on the New Jersy littoral of the Hudson, where Senator Aldrich’s private car would be in readiness, attached to the rear end of a train for the South….
Once aboard the private car we began to observe the taboo that had been fixed on last names. We addressed one another as “Ben,” “Paul,” “Nelson,” “Abe” – it is Abraham Piatt Andrew. Davison and I adopted even deeper disguises, abandoning our first names. On the theory that we were always right, he became Wilbur and I became Orville, after those two aviation pioneers, the Wright brothers….The servants and train crew may have known the identities of one or two of us, but they did not know all, and it was the names of all printed together that would have made our mysterious journey significant in Washington, in Wall Street, even in London. Discovery, we knew, simply must not happen, or else all our time and effort would be wasted.
If it were to be exposed publicly that our particular group had got together and written a banking bill, that bill would have no chance whatever of passage by Congress.
As with all cartels, it had to be created by legislation and sustained by the power of government under the deception of protecting the consumer.
As John Kenneth Galbraith explained it: “It was his [Aldrich’s] thought to outflank the opposition by having not one central bank but many. And the word bank would itself be avoided.”–Galbraith says “…Warburg has, with some justice, been called the father of the system.”
Professor Edwin Seligman, a member of the international banking family of J. & W. Seligman, and head of the Department of Economics at Columbia University, writes that “…in its fundamental features, the Federal Reserve Act is the work of Mr. Warburg more than any other man in the country.”
Another brother, Max Warburg, was the financial adviser of the Kaiser and became Director of the Reichsbank in Germany. This was, of course, a central bank, and it was one of the cartel models used in the construction of the Federal Reserve System. The Reichsbank, incidentally, a few years later would create the massive hyperinflation that occured in Germany, wiping out the middle class and the entire German economy as well.
A. Barton Hepburn of Chase National Bank was even more candid. He said:
“The measure recognizes and adopts the principles of a central bank. Indeed, if all works out as the sponsers of the law hope, it will make all incorporated banks together joint owners of a central dominating power.” And that is about as good a definition of a cartel as one is likely to find – .it is incapable of achieving its stated objectives – why is the System incapable of achieving its stated objectives? The painful answer is: those were never its true objectives.-
Anthony Sutton, former Research Fellow at the Hoover Institution for War, Revolution and Peace, and also Professor of Economics at California State University, Los Angeles, provides a somewhat deeper analysis. He writes: “Warburg’s revolutionary plan to get American Society to go to work for Wall Street was astonishingly simple. Even today, academic theoreticians cover their blackboards with meaningless equations, and the general public struggles in bewildered confusion with inflation and the coming credit collapse, while the quite simple explanation of the problem goes undiscussed and almost entirely uncomprehended. The Federal Reserve System is a legal private monopoly of the money supply operated for the benefit of the few under the guise of protecting and promoting the public interest.–”
The real significance of the journey to Jekyll Island and the creature that was hatched there was inadvertantly summarized by the words of Paul Warburg’s admiring biographer, Harold Kellock: “Paul M. Warburg is probably the mildest-mannered man that ever personally conducted a revolution. It was a bloodless revolution: he did not attempt to rouse the populace to arms. He stepped forth armed simply with an idea. And he conquered. That’s the amazing thing. A shy, sensitive man, he imposed his idea on a nation of a hundred million people.”
THE MANDRAKE MECHANISM…What is it? It is the method by which the Federal Reserve creates money out of nothing; the concept of usury as the payment of interest on pretended loans; the true cause of the hidden tax called inflation; the way in which the Fed creates boom-bust cycles.
In the 1940s, there was a comic strip character called Mandrake the Magician. His specialty was creating things out of nothing and, when appropriate, to make them disappear back into that same void. It is fitting, therefore, that the process to be described in this section should be named in his honor.
In the previous chapters, we examined the technique developed by the political and monetary scientists to create money out of nothing for the purpose of lending. This is not an entirely accurate description because it implies that money is created first and then waits for someone to borrow it. On the other hand, textbooks on banking often state that money is created out of debt. This also is misleading because it implies that debt exists first and then is converted into money. In truth, money is not created until the instant it is borrowed. It is the act of borrowing which causes it to spring into existence. And, incidentally, it is the act of paying off the debt that causes it to vanish. There is no short phrase that perfectly describes that process. So, until one is invented along the way, we shall continue using the phrase “create money out of nothing” and occasionally add “for the purpose of lending” where necessary to further clarify the meaning.
So, let us now…see just how far this money/debt-creation process has been carried — and how it works.
The first fact that needs to be considered is that our money today has no gold or silver behind it whatsoever. The fraction is not 54% nor 15%. It is 0%. It has traveled the path of all previous fractional money in history and already has degenerated into pure fiat money. The fact that most of it is in the form of checkbook balances rather than paper currency is a mere technicality; and the fact that bankers speak about “reserve ratios” is eye wash. The so-called reserves to which they refer are, in fact, Treasury bonds and other certificates of debt. Our money is pure fiat through and through.
The second fact that needs to be clearly understood is that, in spite of the technical jargon and seemingly complicated procedures, the actual mechanism by which the Federal Reserve creates money is quite simple. They do it exactly the same way the goldsmiths of old did except, of course, the goldsmiths were limited by the need to hold some precious metals in reserve, whereas the Fed has no such restriction.
The Federal Reserve is candid
The Federal Reserve itself is amazingly frank about this process. A booklet published by the Federal Reserve Bank of New York tells us: “Currency cannot be redeemed, or exchanged, for Treasury gold or any other asset used as backing. The question of just what assets ‘back’ Federal Reserve notes has little but bookkeeping significance.”
Elsewhere in the same publication we are told: “Banks are creating money based on a borrower’s promise to pay (the IOU)…Banks create money by ‘monetizing’ the private debts of businesses and individuals.”
In a booklet entitled Modern Money Mechanics, the Federal Reserve Bank of Chicago says:
In the United States neither paper currency nor deposits have value as commodities. Intrinsically, a dollar bill is just a piece of paper. Deposits are merely book entries. Coins do have some intrinsic value as metal, but generally far less than their face amount.
What, then, makes these instruments — checks, paper money, and coins — acceptable at face value in payment of all debts and for other monetary uses? Mainly, it is the confidence people have that they will be able to exchange such money for other financial assets and real goods and services whenever they choose to do so. This partly is a matter of law; currency has been designated “legal tender” by the government — that is, it must be accepted.
In the fine print of a footnote in a bulletin of the Federal Reserve Bank of St. Louis, we find this surprisingly candid explanation: Modern monetary systems have a fiat base — literally money by decree — with depository institutions, acting as fiduciaries, creating obligations against themselves with the fiat base acting in part as reserves. The decree appears on the currency notes: “This note is legal tender for all debts, public and private.” While no individual could refuse to accept such money for debt repayment, exchange contracts could easily be composed to thwart its use in everyday commerce. However, a forceful explanation as to why money is accepted is that the federal government requires it as payment for tax liabilities. Anticipation of the need to clear this debt creates a demand for the pure fiat dollars.
Money would vanish without debt
It is difficult for Americans to come to grips with the fact that their total money supply is backed by nothing but debt, and it is even more mind boggling to visualize that, if everyone paid back all that was borrowed, there would be no money left in existence. That’s right, there would not be one penny in circulation — all coins and all paper currency would be returned to bank vaults — and there would be not one dollar in any one’s checking account. In short, all money would disappear.
Marriner Eccles was the Governor of the Federal Reserve System in 1941. On September 30 of that year, Eccles was asked to give testimony before the House Committee on Banking and Currency. The purpose of the hearing was to obtain information regarding the role of the Federal Reserve in creating conditions that led to the depression of the 1930s. Congressman Wright Patman, who was Chairman of that committee, asked how the Fed got the money to purchase two billion dollars worth of government bonds in 1933. This is the exchange that followed.
ECCLES: We created it.
PATMAN: Out of what?
ECCLES: Out of the right to issue credit money.
PATMAN: And there is nothing behind it, is there, except our government’s credit?
ECCLES: That is what our money system is. If there were no debts in our money system, there wouldn’t be any money.
It must be realized that, while money may represent an asset to selected individuals, when it is considered as an aggregate of the total money supply, it is not an asset at all. A man who borrows $1,000 may think that he has increased his financial position by that amount but he has not. His $1,000 cash asset is offset by his $1,000 loan liability, and his net position is zero. Bank accounts are exactly the same on a larger scale. Add up all the bank accounts in the nation, and it would be easy to assume that all that money represents a gigantic pool of assets which support the economy. Yet, every bit of this money is owed by someone. Some will owe nothing. Others will owe many times what they possess. All added together, the national balance is zero. What we think is money is but a grand illusion. The reality is debt.
Robert Hemphill was the Credit Manager of the Federal Reserve Bank in Atlanta. In the foreword to a book by Irving Fisher, entitled 100% Money, Hemphill said this:
If all the bank loans were paid, no one could have a bank deposit, and there would not be a dollar of coin or currency in circulation. This is a staggering thought. We are completely dependent on the commercial banks. Someone has to borrow every dollar we have in circulation, cash, or credit. If the banks create ample synthetic money we are prosperous; if not, we starve. We are absolutely without a permanent money system. When one gets a complete grasp of the picture, the tragic absurdity of our hopeless situation is almost incredible — but there it is.
With the knowledge that money in America is based on debt, it should not come as a surprise to learn that the Federal Reserve System is not the least interested in seeing a reduction in debt in this country, regardless of public utterances to the contrary. Here is the bottom line from the System’s own publications. The Federal Reserve Bank of Philadelphia says: “A large and growing number of analysts, on the other hand, now regard the national debt as something useful, if not an actual blessing….[They believe] the national debt need not be reduced at all.”
he Federal Reserve Bank of Chicago adds: “Debt — public and private — is here to stay. It plays an essential role in economic processes…. What is required is not the abolition of debt, but its prudent use and intelligent management.”
What’s wrong with a little debt?
There is a kind of fascinating appeal to this theory. It gives those who expound it an aura of intellectualism, the appearance of being able to grasp a complex economic principle that is beyond the comprehension of mere mortals. And, for the less academically minded, it offers the comfort of at least sounding moderate. After all, what’s wrong with a little debt, prudently used and intelligently managed? The answer is nothing, provided the debt is based on an honest transaction. There is plenty wrong with it if it is based upon fraud.
An honest transaction is one in which a borrower pays an agreed upon sum in return for the temporary use of a lender’s asset. That asset could be anything of tangible value. If it were an automobile, for example, then the borrower would pay “rent.” If it is money, then the rent is called “interest.” Either way, the concept is the same.
When we go to a lender — either a bank or a private party — and receive a loan of money, we are willing to pay interest on the loan in recognition of the fact that the money we are borrowing is an asset which we want to use. It seems only fair to pay a rental fee for that asset to the person who owns it. It is not easy to acquire an automobile, and it is not easy to acquire money — real money, that is. If the money we are borrowing was earned by someone’s labor and talent, they are fully entitled to receive interest on it. But what are we to think of money that is created by the mere stroke of a pen or the click of a computer key? Why should anyone collect a rental fee on that?
When banks place credits into your checking account, they are merely pretending to lend you money. In reality, they have nothing to lend. Even the money that non-indebted depositors have placed with them was originally created out of nothing in response to someone else’s loan. So what entitles the banks to collect rent on nothing? It is immaterial that men everywhere are forced by law to accept these nothing certificates in exchange for real goods and services. We are talking here, not about what is legal, but what is moral. As Thomas Jefferson observed at the time of his protracted battle against central banking in the United States, “No one has a natural right to the trade of money lender, but he who has money to lend.”
Third reason to abolish the system
Centuries ago, usury was defined as any interest charged for a loan. Modern usage has redefined it as excessive interest. Certainly, any amount of interest charged for a pretended loan is excessive. The dictionary, therefore, needs a new definition. Usury: The charging of any interest on a loan of fiat money.
Let us, therefore, look at debt and interest in this light. Thomas Edison summed up the immorality of the system when he said: People who will not turn a shovel of dirt on the project nor contribute a pound of materials will collect more money…than will the people who will supply all the materials and do all the work.
Is that an exaggeration? Let us consider the purchase of a $100,000 home in which $30,000 represents the cost of the land, architect’s fee, sales commissions, building permits, and that sort of thing and $70,000 is the cost of labor and building materials. If the home buyer puts up $30,000 as a down payment, then $70,000 must be borrowed. If the loan is issued at 11% over a 30-year period, the amount of interest paid will be $167,806. That means the amount paid to those who loan the money is about 2 1/2 times greater than paid to those who provide all the labor and all the materials. It is true that this figure represents the time-value of that money over thirty years and easily could be justified on the basis that a lender deserves to be compensated for surrendering the use of his capital for half a lifetime. But that assumes the lender actually had something to surrender, that he had earned the capital, saved it, and then loaned it for construction of someone else’s house. What are we to think, however, about a lender who did nothing to earn the money, had not saved it, and, in fact, simply created it out of thin air? What is the time-value of nothing?
As we have already shown, every dollar that exists today, either in the form of currency, checkbook money, or even credit card money – in other words, our entire money supply – exists only because it was borrowed by someone; perhaps not you, but someone. That means all the American dollars in the entire world are earning daily and compounding interest for the banks which created them. A portion of every business venture, every investment, every profit, every transaction which involves money – and that even includes losses and the payment of taxes – a portion of all that is earmarked as payment to a bank. And what did the banks do to earn this perpetually flowing river of wealth? Did they lend out their own capital obtained through investment of stockholders? Did they lend out the hard-earned savings of their depositors? No, neither of these were their major source of income. They simply waved the magic wand called fiat money.
The flow of such unearned wealth under the guise of interest can only be viewed as usury of the highest magnitude. Even if there were no other reasons to abolish the Fed, the fact that it is the supreme instrument of usury would be more than sufficient by itself.
Who creates the money to pay the interest?
One of the most perplexing questions associated with this process is “Where does the money come from to pay the interest?” If you borrow $10,000 from a bank at 9%, you owe $10,900. But the bank only manufactures $10,000 for the loan. It would seem, therefore, that there is no way that you — and all others with similar loans — can possibly pay off your indebtedness. The amount of money put into circulation just isn’t enough to cover the total debt, including interest. This has led some to the conclusion that it is necessary for you to borrow the $900 for interest, and that, in turn, leads to still more interest. The assumption is that, the more we borrow, the more we have to borrow, and that debt based on fiat money is a neverending spiral leading inexorably to more and more debt.
This is a partial truth. It is true that there is not enough money created to include the interest, but it is a fallacy that the only way to pay it back is to borrow still more. The assumption fails to take into account the exchange value of labor. Let us assume that you pay back your $10,000 loan at the rate of approximately $900 per month and that about $80 of that represents interest. You realize you are hard pressed to make your payments so you decide to take on a part-time job. The bank, on the other hand, is now making $80 profit each month on your loan. Since this amount is classified as “interest,” it is not extinguished as is the larger portion which is a return of the loan itself. So this remains as spendable money in the account of the bank. The decision then is made to have the bank’s floors waxed once a week. You respond to the ad in the paper and are hired at $80 per month to do the job. The result is that you earn the money to pay the interest on your loan, and — this is the point — the money you receive is the same money which you previously had paid. As long as you perform labor for the bank each month, the same dollars go into the bank as interest, then out of the revolving door as your wages, and then back into the bank as loan repayment.
It is not necessary that you work directly for the bank. No matter where you earn the money, its origin was a bank and its ultimate destination is a bank. The loop through which it travels can be large or small, but the fact remains all interest is paid eventually by human effort. And the significance of that fact is even more startling than the assumption that not enough money is created to pay back the interest. It is that the total of this human effort ultimately is for the benefit of those who create fiat money. It is a form of modern serfdom in which the great mass of society works as indentured servants to a ruling class of financial nobility.
Understanding the illusion
That’s really all one needs to know about the operation of the banking cartel under the protection of the Federal Reserve. But it would be a shame to stop here without taking a look at the actual cogs, mirrors, and pulleys that make the magical mechanism work. It is a truly fascinating engine of mystery and deception. Let us, therefore, turn our attention to the actual process by which the magicians create the illusion of modern money. First we shall stand back for a general view to see the overall action. Then we shall move in closer and examine each component in detail.
The mandrake mechanism: an overview
The entire function of this machine is to convert debt into money. It’s just that simple. First, the Fed takes all the government bonds which the public does not buy and writes a check to Congress in exchange for them. (It acquires other debt obligations as well, but government bonds comprise most of its inventory.) There is no money to back up this check. These fiat dollars are created on the spot for that purpose. By calling those bonds “reserves,” the Fed then uses them as the base for creating 9 additional dollars for every dollar created for the bonds themselves. The money created for the bonds is spent by the government, whereas the money created on top of those bonds is the source of all the bank loans made to the nation’s businesses and individuals. The result of this process is the same as creating money on a printing press, but the illusion is based on an accounting trick rather than a printing trick. The bottom line is that Congress and the banking cartel have entered into a partnership in which the cartel has the privilege of collecting interest on money which it creates out of nothing, a perpetual override on every American dollar that exists in the world. Congress, on the other hand, has access to unlimited funding without having to tell the voters their taxes are being raised through the process of inflation. If you understand this paragraph, you understand the Federal Reserve System.
Now for a more detailed view. There are three general ways in which the Federal Reserve creates fiat money out of debt. One is by making loans to the member banks through what is called the Discount Window. The second is by purchasing Treasury bonds and other certificates of debt through what is called the Open Market Committee. The third is by changing the so-called reserve ratio that member banks are required to hold. Each method is merely a different path to the same objective: taking IOUs and converting them into spendable money.
THE DISCOUNT WINDOW
The Discount Window is merely bankers’ language for the loan window. When banks run short of money, the Federal Reserve stands ready as the “bankers’ bank” to lend it. There are many reasons for them to need loans. Since they hold “reserves” of only about one or two per cent of their deposits in vault cash and eight or nine per cent in securities, their operating margin is extremely thin. It is common for them to experience temporary negative balances caused by unusual customer demand for cash or unusually large clusters of checks all clearing through other banks at the same time. Sometimes they make bad loans and, when these former “assets” are removed from their books, their “reserves” are also decreased and may, in fact, become negative. Finally, there is the profit motive. When banks borrow from the Federal Reserve at one interest rate and lend it out at a higher rate, there is an obvious advantage. But that is merely the beginning. When a bank borrows a dollar from the Fed, it becomes a one-dollar reserve. Since the banks are required to keep reserves of only about ten per cent, they actually can loan up to nine dollars for each dollar borrowed.
Let’s take a look at the math. Assume the bank receives $1 million from the Fed at a rate of 8%. The total annual cost, therefore, is $80,000 (.08 X $1,000,000). The bank treats the loan as a cash deposit, which means it becomes the basis for manufacturing an additional $9 million to be lent to its customers. If we assume that it lends that money at 11% interest, its gross return would be $990,000 (.11 X $9,000,000). Subtract from this the bank’s cost of $80,000 plus an appropriate share of its overhead, and we have a net return of about $900,000. In other words, the bank borrows a million and can almost double it in one year. That’s leverage! But don’t forget the source of that leverage: the manufacture of another $9 million which is added to the nation’s money supply.
THE OPEN MARKET OPERATION
The most important method used by the Federal Reserve for the creation of fiat money is the purchase and sale of securities on the open market. But, before jumping into this, a word of warning. Don’t expect what follows to make any sense. Just be prepared to know that this is how they do it.
The trick lies in the use of words and phrases which have technical meanings quite different from what they imply to the average citizen. So keep your eye on the words. They are not meant to explain but to deceive. In spite of first appearances, the process is not complicated. It is just absurd.
THE MANDRAKE MECHANISM: A DETAILED VIEW
The federal government adds ink to a piece of paper, creates impressive designs around the edges, and calls it a bond or Treasury note. It is merely a promise to pay a specified sum at a specified interest on a specified date. As we shall see in the following steps, this debt eventually becomes the foundation for almost the entire nation’s money supply.13 In reality, the government has created cash, but it doesn’t yet look like cash. To convert these IOUs into paper bills and checkbook money is the function of the Federal Reserve System. To bring about that transformation, the bond is given to the Fed where it is then classified as a…
An instrument of government debt is considered an asset because it is assumed the government will keep its promise to pay. This is based upon its ability to obtain whatever money it needs through taxation. Thus, the strength of this asset is the power to take back that which it gives. So the Federal Reserve now has an “asset” which can be used to offset a liability. It then creates this liability by adding ink to yet another piece of paper and exchanging that with the government in return for the asset. That second piece of paper is a…
FEDERAL RESERVE CHECK
There is no money in any account to cover this check. Anyone else doing that would be sent to prison. It is legal for the Fed, however, because Congress wants the money, and this is the easiest way to get it. (To raise taxes would be political suicide; to depend on the public to buy all the bonds would not be realistic, especially if interest rates are set artificially low; and to print very large quantities of currency would be obvious and controversial.) This way, the process is mysteriously wrapped up in the banking system. The end result, however, is the same as turning on government printing presses and simply manufacturing fiat money (money created by the order of government with nothing of tangible value backing it) to pay government expenses. Yet, in accounting terms, the books are said to be “balanced” because the liability of the money is offset by the “asset” of the IOU. The Federal Reserve check received by the government then is endorsed and sent back to one of the Federal Reserve banks where it now becomes a…
Once the Federal Reserve check has been deposited into the government’s account, it is used to pay government expenses and, thus, is transformed into many…
These checks become the means by which the first wave of fiat money floods into the economy. Recipients now deposit them into their own bank accounts where they become…
COMMERCIAL BANK DEPOSITS
Commercial bank deposits immediately take on a split personality. On the one hand, they are liabilities to the bank because they are owed back to the depositors. But, as long as they remain in the bank, they also are considered as assets because they are on hand. Once again, the books are balanced: the assets offset the liabilities. But the process does not stop there. Through the magic of fractional-reserve banking, the deposits are made to serve an additional and more lucrative purpose. To accomplish this, the on-hand deposits now become reclassified in the books and called…
Reserves for what? Are these for paying off depositors should they want to close out of their accounts? No. That’s the lowly function they served when they were classified as mere assets. Now that they have been given the name of “reserves,” they become the magic wand to materialize even larger amounts of fiat money. This is where the real action is: at the level of the commercial banks. Here’s how it works. The banks are permitted by the Fed to hold as little as 10% of their deposits in “reserve.” That means, if they receive deposits of $1 million from the first wave of fiat money created by the Fed, they have $900,000 more than they are required to keep on hand ($1 million less 10% reserve). In bankers’ language, that $900,000 is called…
The word “excess” is a tipoff that these so-called reserves have a special destiny. Now that they have been transmuted into an excess, they are considered as available for lending. And so in due course these excess reserves are converted into…
But wait a minute. How can this money be loaned out when it is owned by the original depositors who are still free to write checks and spend it any time they wish? The answer is that, when the new loans are made, they are not made with the same money at all. They are made with brand new money created out of thin air for that purpose. The nation’s money supply simply increases by ninety per cent of the bank’s deposits. Furthermore, this new money is far more interesting to the banks than the old. The old money, which they received from depositors, requires them to pay out interest or perform services for the privilege of using it. But, with the new money, the banks collect interest, instead, which is not too bad considering it cost them nothing to make. Nor is that the end of the process. When this second wave of fiat money moves into the economy, it comes right back into the banking system, just as the first wave did, in the form of…
MORE COMMERCIAL BANK DEPOSITS
The process now repeats but with slightly smaller numbers each time around. What was a “loan” on Friday comes back into the bank as a “deposit” on Monday. The deposit then is reclassified as a “reserve” and ninety per cent of that becomes an “excess” reserve which, once again, is available for a new “loan.” Thus, the $1 million of first wave fiat money gives birth to $900,000 in the second wave, and that gives birth to $810,000 in the third wave ($900,000 less 10% reserve). It takes about twenty-eight times through the revolving door of deposits becoming loans becoming deposits becoming more loans until the process plays itself out to the maximum effect, which is…
BANK FIAT MONEY = UP TO 9 TIMES GOVERNMENT
The amount of fiat money created by the banking cartel is approximately nine times the amount of the original government debt which made the entire process possible. When the original debt itself is added to that figure, we finally have…
TOTAL FIAT MONEY = UP TO 10 TIMES GOVERNMENT
The total amount of fiat money created by the Federal Reserve and the commercial banks together is approximately ten times the amount of the underlying government debt. To the degree that this newly created money floods into the economy in excess of goods and services, it causes the purchasing power of all money, both old and new, to decline. Prices go up because the relative value of the money has gone down. The result is the same as if that purchasing power had been taken from us in taxes. The reality of this process, therefore, is that it is a…
HIDDEN TAX = UP TO 10 TIMES THE NATIONAL DEBT
Without realizing it, Americans have paid over the years, in addition to their federal income taxes and excise taxes, a completely hidden tax equal to many times the national debt! And that still is not the end of the process. Since our money supply is purely an arbitrary entity with nothing behind it except debt, its quantity can go down as well as up. When people are going deeper into debt, the nation’s money supply expands and prices go up, but when they pay off their debts and refuse to renew, the money supply contracts and prices tumble. That is exactly what happens in times of economic or political uncertainty. This alternation between period of expansion and contraction of the money supply is the underlying cause of…
BOOMS, BUSTS, AND DEPRESSIONS
Who benefits from all of this? Certainly not the average citizen. The only beneficiaries are the political scientists in Congress who enjoy the effect of unlimited revenue to perpetuate their power, and the monetary scientists within the banking cartel called the Federal Reserve System who have been able to harness the American people, without their knowing it, to the yoke of modern feudalism.
The previous figures are based on a “reserve” ratio of 10% (a money-expansion ratio of 10-to-1). It must be remembered, however, that this is purely arbitrary. Since the money is fiat with no previous-metal backing, there is no real limitation except what the politicians and money managers decide is expedient for the moment. Altering this ratio is the third way in which the Federal Reserve can influence the nation’s supply of money. The numbers, therefore, must be considered as transient. At any time there is a “need” for more money, the ratio can be increased to 20-to-1 or 50-to-1, or the pretense of a reserve can be dropped altogether. There is virtually no limit to the amount of fiat money that can be manufactured under the present system.
NATIONAL DEBT NOT NECESSARY FOR INFLATION
Because the Federal Reserve can be counted on to “monetize” (convert into money) virtually any amount of government debt, and because this process of expanding the money supply is the primary cause of inflation, it is tempting to jump to the conclusion that federal debt and inflation are but two aspects of the same phenomenon. This, however, is not necessarily true. It is quite possible to have either one without the other.
The banking cartel holds a monopoly in the manufacture of money. Consequently, money is created only when IOUs are “monetized” by the Fed or by commercial banks. When private individuals, corporations, or institutions purchase government bonds, they must use money they have previously earned and saved. In other words, no new money is created, because they are using funds that are already in existence. Therefore, the sale of government bonds to the banking system is inflationary, but when sold to the private sector, it is not. That is the primary reason the United States avoided massive inflation during the 1980s when the federal government was going into debt at a greater rate than ever before in its history. By keeping interest rates high, these bonds became attractive to private investors, including those in other countries.15 Very little new money was created, because most of the bonds were purchased with American dollars already in existence. This, of course, was a temporary fix at best. Today, those bonds are continually maturing and are being replaced by still more bonds to include the original debt plus accumulated interest. Eventually this process must come to an end and, when it does, the Fed will have no choice but to literally buy back all the debt of the ’80s — that is, to replace all of the formerly invested private money with newly manufactured fiat money — plus a great deal more to cover the interest. Then we will understand the meaning of inflation.
On the other side of the coin, the Federal Reserve has the option of manufacturing money even if the federal government does not go deeper into debt. For example, the huge expansion of the money supply leading up to the stock market crash in 1929 occurred at a time when the national debt was being paid off. In every year from 1920 through 1930, federal revenue exceeded expenses, and there were relatively few government bonds being offered. The massive inflation of the money supply was made possible by converting commercial bank loans into “reserves” at the Fed’s discount window and by the Fed’s purchase of banker’s acceptances, which are commercial contracts for the purchase of goods.
Now the options are even greater. The Monetary Control Act of 1980 has made it possible for the Creature to monetize virtually any debt instrument, including IOUs from foreign governments. The apparent purpose of this legislation is to make it possible to bail out those governments which are having trouble paying the interest on their loans from American banks. When the Fed creates fiat American dollars to give foreign governments in exchange for their worthless bonds, the money path is slightly longer and more twisted, but the effect is similar to the purchase of U.S. Treasury Bonds. The newly created dollars go to the foreign governments, then to the American banks where they become cash reserves. Finally, they flow back into the U.S money pool (multiplied by nine) in the form of additional loans. The cost of the operation once again is born by the American citizen through the loss of purchasing power. Expansion of the money supply, therefore, and the inflation that follows, no longer even require federal deficits. As long as someone is willing to borrow American dollars, the cartel will have the option of creating those dollars specifically to purchase their bonds and, by so doing, continue to expand the money supply.
We must not forget, however, that one of the reasons the Fed was created in the first place was to make it possible for Congress to spend without the public knowing it was being taxed. Americans have shown an amazing indifference to this fleecing, explained undoubtedly by their lack of understanding of how the Mandrake Mechanism works. Consequently, at the present time, this cozy contract between the banking cartel and the politicians is in little danger of being altered. As a practical matter, therefore, even though the Fed may also create fiat money in exchange for commercial debt and for bonds of foreign governments, its major concern likely will be to continue supplying Congress.
The implications of this fact are mind boggling. Since our money supply, at present at least, is tied to the national debt, to pay off that debt would cause money to disappear. Even to seriously reduce it would cripple the economy. Therefore, as long as the Federal Reserve exists, America will be, must be, in debt.
The purchase of bonds from other governments is accelerating in the present political climate of internationalism. Our own money supply increasingly is based upon their debt as well as ours, and they, too, will not be allowed to pay it off even if they are able.
EXPANSION LEADS TO CONTRACTION
While it is true that the Mandrake Mechanism is responsible for the expansion of the money supply, the process also works in reverse. Just as money is created when the Federal Reserve purchases bonds or other debt instruments, it is extinguished by the sale of those same items. When they are sold, the money is given back to the System and disappears into the inkwell or computer chip from which it came. Then, the same secondary ripple effect that created money through the commercial banking system causes it to be withdrawn from the economy. Furthermore, even if the Federal Reserve does not deliberately contract the money supply, the same result can and often does occur when the public decides to resist the availability of credit and reduce its debt. A man can only be tempted to borrow, he cannot be forced to do so.
There are many psychological factors involved in a decision to go into debt that can offset the easy availability of money and a low interest rate: A downturn in the economy, the threat of civil disorder, the fear of pending war, an uncertain political climate, to name just a few. Even though the Fed may try to pump money into the economy by making it abundantly available, the public can thwart that move simply by saying no, thank you. When this happens, the olds debts that are being paid off are not replaced by new ones to take their place, and the entire amount of consumer and business debt will shrink. That means the money supply also will shrink, because, in modern America, debt is money. And it is this very expansion and contraction of the monetary pool — a phenomenon that could not occur if based upon the laws of supply and demand — that is at the very core of practically every boom and bust that has plagued mankind throughout history.
In conclusion, it can be said that modern money is a grand illusion conjured by the magicians of finance in politics. We are living in an age of fiat money, and it is sobering to realize that every previous nation in history that has adopted such money eventually was economically destroyed by it. Furthermore, there is nothing in our present monetary structure that offers any assurances that we may be exempted from that morbid roll call.
Correction. There is one. It is still within the power of Congress to abolish the Federal Reserve System.
The American dollar has no intrinsic value. It is a classic example of fiat money with no limit to the quantity that can be produced. Its primary value lies in the willingness of people to accept it and, to that end, legal tender laws require them to do so.
It is true that our money is created out of nothing, but it is more accurate to say that it is based upon debt. In one sense, therefore, our money is created out of less than nothing. The entire money supply would vanish into the bank vaults and computer chips if all debts were repaid.
Under the present System, therefore, our leaders cannot allow a serious reduction in either the national or consumer debt. Charging interest on pretended loans is usury, and that has become institutionalized under the Federal Reserve System.
The Mandrake Mechanism by which the Fed converts debt into money may seem complicated at first, but it is simple if one remembers that the process is not intended to be logical but to confuse and deceive. The end product of the Mechanism is artificial expansion of the money supply, which is the root cause of the hidden tax called inflation.
This expansion then leads to contraction and, together, they produce the destructive boom-bust cycle that has plagued mankind throughout history wherever fiat money has existed.
More on How Money is Created by The Private Banks
“Modern Banking” was actually created over 4,000 years ago in Babylon. [Of course, without the electronic information.] Henry Ford (founder of the Ford Motor Company in 1903) stated: “It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
The “lending” techniques that are used are beyond brilliant. It took some very, very smart people to figure out how to appear to be lending money, but in actuality have the value supplied by the person who is borrowing (wanting a loan). When you discover the truth, you will be seething mad… .
The whole truth is NOT revealed to the borrower by the bank. The bank or other lending institution does NOT disclose to you that your promissory note to repay the loan is actually an asset to the bank – that they deposit. The bank does not let you know that a promissory note is actually a “negotiable instrument” under the Uniform Commercial Code, and that it will be deposited to fund your loan. Nor do you learn that the bank has a liability to you of approximately the amount of the loan. (The bank owes you by their own bookkeeping entries!)
The bank does NOT tell you that you factually provided the actual cash value for your own loan! Thus, the bank only appears to be lending you anything. That’s right: banks and lending institutions only appear to lend money. Let’s go through how money is created at the “government” level, then we’ll see how this applies to you and your alleged debt.
How Money Is Created In the U.S.:
- Congress says, “We need $10 Billion.”
- So they go over to the treasury and say, “We need $10 Billion.”
- The U.S. Treasury prints up $10 Billion in government bonds.
- They take those bonds over to the privately owned Federal Reserve Bank (Fed), you know, just down the road from the Treasury.
- They walk into the Fed with these $10 Billion in bonds and say, “We need to borrow $10 Billion.”
- The Fed takes that $10 Billion in Bonds and agrees to then loan the U.S. Government $10 Billion.
- The Fed writes into their little ledger with a stubby pencil, “Owes us $10 Billion.” (Actually, it’s done by computer nowadays.)
- The Fed then creates money out of thin air by authorizing some currency to be printed. Note that the legal tender in the US is the private Federal Reserve Note (not a United States Government Note).
- Now the U.S. Government owes another $10 Billion.
Government officials agree that this is how the banking system works today:
Representative Wright Patman, former Chairman of a House Banking Committee said:
“The Federal Reserve Banks create money out of thin air to buy Government bonds… The Federal Reserve Bank is a total money making machine.”
Former Federal Reserve Bank Chairman Eccles was asked by Patman, “Mr. Eccles, how did you get the money to buy these two billion dollars of government bonds.” Mr. Eccles replied, “We create it.” “Out of what?” Patman asked. “Out of the right to issue credit money.”, i.e. out of nothing (by the way, this right to create money out of nothing was given to the Private Federal Reserve Bank by a fraudulent act of Congress in 1913 known as the Federal Reserve Act, same fraud has been happening since the 17th century with the Private Bank of England).
Former Congress Louis McFadden, former chairman of the House Committee on Banking and Currency remarked about the Federal Reserve Bank: “A super-state controlled by international bankers and international industrialists acting together to enslave the world for their own pleasure.”
When the unconstitutional Federal Reserve Act was about to be passed in 1913, Congressman Charles Lindbergh said, “This Act establishes the most gigantic trust on Earth. When the President signs this bill, the invisible government by the monetary power will be legalized. The people may not know it immediately, but the day of reckoning is only a few years removed…The worst legislative crime of the ages is perpetrated by this banking bill.”
f you’re an honest, ethical person, then you believe that all lenders should be repaid. If the Federal Reserve Banking System repaid the loan from the U.S. Government, the “debt” would be cancelled.
Let’s Take a Quick Look Over That
The bonds printed by the treasury have an actual value of $10 Billion. They take the actual value of $10 Billion in bonds over to the privately owned Fed bank to “borrow” the $10 Billion in currency.(~?~)
[Note: If an asset is anything that can be sold, and then the money received can be deposited into a bank, then there was nothing actually lent to the U.S. Government, was there? They provided bonds that could be sold for $10 Billion in exchange for the $10 Billion from the Fed. Where was the loan? There was none. The Fed and the U.S. Government made an exchange, and the Fed lied and called it a loan.]
Now, we all know that the people who run the government aren’t the brightest, but to give away the bonds so they can borrow money is just ridiculous, wouldn’t you agree?
Look, I don’t expect you to believe that without some proof. I mean, it’s just insane, right? Listen to a recording about the Story of the Federal Reserve System. It’s FREE to you, over an hour long, and it’s called The Creature from Jeckyll Island, by G. Edward Griffin. Mr. Griffin is a well-respected authority on the creation of the Federal Reserve Banking System, and has written a best-selling book of the same name. The link to the audio clip is: http://www.eliminatemortgages.com/creature.rm .
How This Applies to You
On a national level, we see the absurdity behind the “money creation” process. But when it’s right there in our face, it’s a little harder to “see the forest through all the trees.”
Money is created on a local level through the banks and other lending institutions in much the same way. The value is first provided to the bank, the bank deposits the asset, and the asset you provided is used as the value to fund the “loan” to you.
Again, I know it sounds absurd, like, “How can they get away with this?” I wondered the same thing when I first came across this information. The Federal Reserve Bank of Chicago came out with a very revealing publication back in the 1990s called Modern Money Mechanics. While the file itself is a web page, in the physical publication on page 6 we find the exact mechanics of this, including the bookkeeping entries. (There is more information at http://banksrestorationact.4mg.com .)
So how does the bank loan actually work?
- You want a loan for your home.
- The bank advertises that they loan money.
- You “apply” for a “loan.”
- They put you through the ringer and make you glad and relieved that you were able to be approved for a loan. (You know, like they are doing you a really big favor.)
- They have you sign a promissory note.
And here’s the part you’re never supposed to know
- Since your promissory note can be sold for money, it’s an asset. (Covered more in the Research section.)
- The bank deposits the asset into an account for approximately the amount of the note.
- The bank cuts you a check from the deposit you never knew about (or transfers the money to those who should be receiving it).
- And you think you owe money back on a loan, when in fact all that was made was an exchange.
Just in case you don’t believe the above, printoff the affidavit below and try to get any bank president to sign it! He won’t!!!
Affidavit for the Bankers
The undersigned affiant, being duly sworn on oath, deposes and says: That he/she is an officer of the below named financial institution, a nationally chartered commercial bank or lending institution or organization purchasing promissory notes, hereinafter called bank. That, as an officer of the bank, he/she has the authority to execute this affidavit on behalf of the bank and to bind the bank to its provisions. It is understood that an exchange is not a loan. It is understood that the borrower’s promissory note is not used to fund any check. It is understood that the bank does not record the promissory note as abank asset offset by a abank liability. It is understood the bank complies with and follows the Federal Reserve Bank’s policies and procedures. It is understood that the bank does not use the same or a similar bookkeeping entry to record the promissory note as a loan to the bank. It is understood that when banks participate in ranting loans the economic effect is not the same or similar to stealing, counterfeiting, or a swindle. Banks who follow the Federal Reserve Bank’s policies and procedures deny customers neither equal protection under the alw, nor money, nor credit. The bank fully discloses to each and every borrower all material facts concerning if the borrower provided the funds to issue the bank loan check or if other depositors or investors fund the bank loan check. It is understood that the one who funded the loan should be repaid their money. It is understood that cash is the money and a bank liability indicates that the bank owes cash. I agree that if I have made a false statement regarding bank loans, then any and all loans or alleged loans issued or purchased at the bank are forgiven, without recourse, and shall immediately be considered null and void. Signed under penalty of perjury.
Signature of Bank Officer __________________________________________
Print Name of Bank Officer__________________________________________
Name of Bank: ___________________________________________________
Address of Bank: _________________________________________________
Sworn to and subscribed before me this _____ day of ___________________, 20____
Signature of Notary Public ________________________________________________
Now Let’s Look at That…
If you think about it, the bankers’ scheme is really quite brilliant. I mean, what other business in the whole world allows you to create money based on the value that someone else gives you, then charge that person again plus interest? Wow!
So the real question becomes, “If the promissory note is an asset, what funded the bank’s ownership of the note?”
Answer: They still don’t really own it. They made an exchange – Your promissory note (asset to the bank) was exchanged for approximately the amount of the loan. You gave the bank an asset worth $100,000 and the bank returned $100,000 to you. Where was the loan? There wasn’t one. But you really do have to admit, it’s brilliant.
Listen, we’re not the first people to “discover” this was going on. But we have figured out some things that no one else has!
As an honest, ethical person who believes that all loans should be repaid, do you agree that the bank should repay your loan to them? After all, they deposited your promissory note. Your promissory note is an asset that they exchanged for a check. Where’s the loan? Factually, there isn’t one. And since all lenders should be repaid, shouldn’t the bank repay your loan to them? If so, you wouldn’t have the “debt” and would live better.
Quickly, when you deposit money in your checking account, does the bank now owe you that money when you want it? Yes. The bank has a new asset, the $100 you deposited into your checking account. The bank also has a new matching liability that says the bank owes you $100. Assets = Liabilities.
The bookkeeping entries are nearly identical for a deposit into your checking account and for a new loan. By lending, the banks now have more assets and liabilities.
If you were to lend me $500, your “pool of money” would be smaller. When a bank “loans” money, their “pool of money” increases.
Quick Summary behind How a Bank Loan Works
Money is created today by “lending,” so all money today is born as “debt money.”
The person who wants a loan must provide to the bank something that he or she doesn’t know is valuable, called a promissory note.
The promissory note is a bank asset, and that asset is deposited into a demand deposit type of account.
The asset deposited is what provides the bank the value to be able to “lend” to you and others.
The bank exchanges value for value, just like the Federal Reserve Bank and our Government, then lies about it and calls it a loan.
You and millions of others believe you have a debt.
This has the similar economic effect of counterfeiting, swindling and stealing.
More on Equal Protection
Our founding fathers knew about this type of banking. That’s why there were provisions in the Constitution of the United States of America to stop this type of banking system to infest our nation.
Article 1, Section 8, clause 5 states:
“Congress shall have the power to coin money, regulate the value thereof, and of foreign coin, and fix the standard of weights and measures.”
Article 1, Section 10 in part states:
“No state shall use any Thing but gold and silver coin as a tender in payment of its debts;”
Is it more difficult to create money with “creative bookkeeping,” (or as President Bush says, “Cookin’ the Books”) by depositing your promissory note and not telling you? Or is it more difficult to mine the gold and silver to mint the money? Mining is difficult and expensive. Bookkeeping entries cost virtually nothing.
Take a look at the definition of “Bank” in the 4th Edition of Black’s Law Dictionary:
“An institution, of great value in the commercial world, empowered to receive deposits of money, to make loans, and to issue its promissory notes (designed to circulate as money, and commonly called ‘bank notes’ or ‘bank-bills,’) or to perform any one or more of these functions.” If a promissory note is designed to circulate as money, like money it can be deposited into a checking account, can’t it? You bet.
That was never disclosed in the bank loan agreement, was it? No.
See, if gold and silver coin were the money, the current banking system could not exist. Our founding fathers knew that.
Since the promissory note is a negotiable instrument, per the Uniform Commercial Code, at what point did the bank “own” the promissory note? A note is an IOU. It says “I owe you $X, which is to be repaid on this or that date, or through payments.”
Did you give the bank permission to turn your “promise to pay” into money? Probably not. By the bank altering the note and turning it into a negotiable instrument, they changed the cost and the risk to you and them. Before they deposit the note into a checking account, you thought the agreement was that they were going to loan you money. They were the ones at risk. It’s your duty to pay them.
When the bank deposited the note, the entire cost of the loan was funded by you, and you’re now supposed to pay them? That’s not what you agreed to, is it? Because of this banking system, you are in “debt” with “money” that you provided the value for. There’s a lot more to this and you should know it, but it’s also a lot to try to learn quickly.
By the way, what is the difference between the economics of the current banking system and a thief who steals from you? And a counterfeiter who “loans” you counterfeiter at no cost to him? A cheap con artist who swindles you into believing you owe him money? What is the difference between the banking system today and a counterfeiter, theif, and a swindler? There is no economic difference.
You can get more information from: Ted Susu-Mago http://eliminatemortgages.com/. Here’s just some of what you will discover for yourself when you get more information:
� The “Big Plan” the Bankers had – way back in 1892 – and are still carrying forth.
� They say there’s a positive and a negative for everything, so what are the two faces of debt?
� When the U.S. declared bankruptcy in 1933, what did they really do to our money?
� What is so valuable about being able to control the interest rates?
� How is public debt really measured, and how do you increase the public debt every time you use a credit card, take out a “loan” or use electronic money?
Chart of who “owns” the Federal Reserve
Federal Reserve Directors: A Study of Corporate and Banking Influence
Chart 1 reveals the linear connection between the Rothschilds and the Bank of England, and the London banking houses which ultimately control the Federal Reserve Banks through their stockholdings of bank stock and their subsidiary firms in New York. The two principal Rothschild representatives in New York, J. P. Morgan Co., and Kuhn,Loeb & Co. were the firms which set up the Jekyll Island Conference at which the Federal Reserve Act was drafted, who directed the subsequent successful campaign to have the plan enacted into law by Congress, and who purchased the controlling amounts of stock in the Federal Reserve Bank of New York in 1914. These firms had their principal officers appointed to the Federal Reserve Board of Governors and the Federal Advisory Council in 1914. In 1914 a few families (blood or business related) owning controlling stock in existing banks (such as in New York City) caused those banks to purchase controlling shares in the Federal Reserve regional banks. Examination of the charts and text in the House Banking Committee Staff Report of August, 1976 and the current stockholders list of the 12 regional Federal Reserve Banks show this same family control.
N.M. Rothschild , London – Bank of England
| J. Henry Schroder
| Banking | Corp.
Brown, Shipley – Morgan Grenfell – Lazard – |
& Company & Company Brothers |
| | | |
——————–| ——-| | |
| | | | | |
Alex Brown – Brown Bros. – Lord Mantagu – Morgan et Cie — Lazard —|
& Son | Harriman Norman | Paris Bros |
| | / | N.Y. |
| | | | | |
| Governor, Bank | J.P. Morgan Co — Lazard —|
| of England / N.Y. Morgan Freres |
| 1924-1938 / Guaranty Co. Paris |
| / Morgan Stanley Co. | /
| / | \Schroder Bank
| / | Hamburg/Berlin
| / Drexel & Company /
| / Philadelphia /
| / /
| / Lord Airlie
| / /
| / M. M. Warburg Chmn J. Henry Schroder
| | Hamburg ——— marr. Virginia F. Ryan
| | | grand-daughter of Otto
| | | Kahn of Kuhn Loeb Co.
| | |
| | |
Lehman Brothers N.Y ————– Kuhn Loeb Co. N. Y.
| | ————————–
| | | |
| | | |
Lehman Brothers – Mont. Alabama Solomon Loeb Abraham Kuhn
| | __|______________________|_________
Lehman-Stern, New Orleans Jacob Schiff/Theresa Loeb Nina Loeb/Paul Warburg
————————- | | |
| | Mortimer Schiff James Paul Warburg
| | | | |
Mayer Lehman | Emmanuel Lehman \
| | | \
Herbert Lehman Irving Lehman \
| | | \
Arthur Lehman \ Phillip Lehman John Schiff/Edith Brevoort Baker
/ | Present Chairman Lehman Bros
/ Robert Owen Lehman Kuhn Loeb – Granddaughter of
/ | George F. Baker
| / |
| / |
| / Lehman Bros Kuhn Loeb (1980)
| / |
| / Thomas Fortune Ryan
| | |
| | |
Federal Reserve Bank Of New York |
______National City Bank N. Y. |
| | |
| National Bank of Commerce N.Y —|
| | \
| Hanover National Bank N.Y. \
| | \
| Chase National Bank N.Y. \
|Shareholders – National City Bank – N.Y.
James Stillman /
Elsie m. William Rockefeller /
Isabel m. Percy Rockefeller /
William Rockefeller Shareholders – National Bank of Commerce N. Y.
J. P. Morgan ———————————————–
M.T. Pyne Equitable Life – J.P. Morgan
Percy Pyne Mutual Life – J.P. Morgan
J.W. Sterling H.P. Davison – J. P. Morgan
NY Trust/NY Edison Mary W. Harriman
Shearman & Sterling A.D. Jiullard – North British Merc. Insurance
| Jacob Schiff
| Thomas F. Ryan
| Paul Warburg
| Levi P. Morton – Guaranty Trust – J. P. Morgan
Shareholders – First National Bank of N.Y.
George F. Baker
George F. Baker Jr.
Edith Brevoort Baker
US Congress – 1946-64
Shareholders – Hanover National Bank N.Y.
Shareholders – Chase National Bank N.Y.
George F. Baker
Federal Reserve Directors: A Study of Corporate and Banking Influence
– Published 1983
The J. Henry Schroder Banking Company chart encompasses the entire history of the twentieth century, embracing as it does the program (Belgium Relief Commission) which provisioned Germany from 1915-1918 and dissuaded Germany from seeking peace in 1916; financing Hitler in 1933 so as to make a Second World War possible; backing the Presidential campaign of Herbert Hoover ; and even at the present time, having two of its major executives of its subsidiary firm, Bechtel Corporation serving as Secretary of Defense and Secretary of State in the Reagan Administration.
The head of the Bank of England since 1973, Sir Gordon Richardson, Governor of the Bank of England (controlled by the House of Rothschild) was chairman of J. Henry Schroder Wagg and Company of London from 1963-72, and director of J. Henry Schroder,New York and Schroder Banking Corporation,New York,as well as Lloyd’s Bank of London, and Rolls Royce. He maintains a residence on Sutton Place in New York City, and as head of “The London Connection,” can be said to be the single most influential banker in the world.
J. Henry Schroder
Baron Rudolph Von Schroder
Hamburg – 1858 – 1934
Baron Bruno Von Schroder
Hamburg – 1867 – 1940
F. C. Tiarks |
marr. Emma Franziska |
(Hamburg) Helmut B. Schroder
J. Henry Schroder 1902 |
Dir. Bank of England |
Dir. Anglo-Iranian |
Oil Company J. Henry Schroder Banking Company N.Y.
J. Henry Schroder Trust Company N.Y.
Allen Dulles John Foster Dulles
Sullivan & Cromwell Sullivan & Cromwell
Director – CIA U. S. Secretary of State
Belgian Relief Comm. Lord Airlie
Chief Marine Transportation ———–
US Food Administration WW I Chairman; Virgina Fortune
Manati Sugar Co. American & Ryan daughter of Otto Kahn
British Continental Corp. of Kuhn,Loeb Co.
M. E. Rionda |
Pres. Cuba Cane Sugar Co. |
Manati Sugar Co. many other |
sugar companies. _______|
G. A. Zabriskie |
————— | Emile Francoui
Chmn U.S. Sugar Equalization | ————–
Board 1917-18; Pres Empire | Belgian Relief Comm. Kai
Biscuit Co., Columbia Baking | Ping Coal Mines, Tientsin
Co. , Southern Baking Co. | Railroad,Congo Copper, La
| Banque Nationale de Belgique
Suite 2000 42 Broadway | N. Y |
| | |
| | |
Edgar Richard Julius H. Barnes Herbert Hoover
Belgium Relief Comm Belgium Relief Comm Chmn Belgium Relief Com
Amer Relief Comm Pres Grain Corp. U.S. Food Admin
U.S. Food Admin U.S. Food Admin Sec of Commerce 1924-28
1918-24, Hazeltine Corp. 1917-18, C.B Pitney Kaiping Coal Mines
| Bowes Corp, Manati Congo Copper, President
| Sugar Corp. U.S. 1928-32
John Lowery Simpson
Sacramento,Calif Belgium Relief |
Comm. U. S. Food Administration Baron Kurt Von Schroder
Prentiss Gray Co. J. Henry Schroder ———————–
Trust, Schroder-Rockefeller, Chmn Schroder Banking Corp. J.H. Stein
Fin Comm, Bechtel International Bankhaus (Hitler’s personal bank
Co. Bechtel Co. (Casper Weinberger account) served on board of all
Sec of Defense, George P. Schultz German subsidiaries of ITT . Bank
Sec of State (Reagan Admin). for International Settlements,
| SS Senior Group Leader,Himmler’s
| Circle of Friends (Nazi Fund),
| Deutsche Reichsbank,president
Schroder-Rockefeller & Co. , N.Y.
Avery Rockefeller, J. Henry Schroder
Banking Corp., Bechtel Co., Bechtel
International Co. , Canadian Bechtel
Governor, Bank of England
1973-PRESENT C.B. of J. Henry Schroder N.Y.
Schroder Banking Co., New York, Lloyds Bank
Federal Reserve Directors: A Study of Corporate and Banking Influence
– Published 1976
The David Rockefeller chart shows the link between the Federal Reserve Bank of New York,Standard Oil of Indiana,General Motors and Allied Chemical Corportion (Eugene Meyer family) and Equitable Life (J. P. Morgan).
Chairman of the Board
Chase Manhattan Corp
Chase Manhattan Corp. |
|Officer & Director Interlocks
Private Investment Co. for America Allied Chemicals Corp.
Firestone Tire & Rubber Company General Motors
Orion Multinational Services Ltd. Rockefeller Family & Associates
ASARCO. Inc Chrysler Corp.
Southern Peru Copper Corp. Intl’ Basic Economy Corp.
Industrial Minerva Mexico S.A. R.H. Macy & Co.
Continental Corp. Selected Risk Investments S.A.
Honeywell Inc. Omega Fund, Inc.
Northwest Airlines, Inc. Squibb Corporation
Northwestern Bell Telephone Co. Olin Foundation
Minnesota Mining & Mfg Co (3M) Mutual Benefit Life Ins. Co. of NJ
American Express Co. AT & T
Hewlett Packard Pacific Northwestern Bell Co.
FMC Corporation BeachviLime Ltd.
Utah Intl’ Inc. Eveleth Expansion Company
Exxon Corporation Fidelity Union Bancorporation
International Nickel/Canada Cypress Woods Corporation
Federated Capital Corporation Intl’ Minerals & Chemical Corp.
Equitable Life Assurance Soc U.S. Burlington Industries
Federated Dept Stores Wachovia Corporation
General Electric Jefferson Pilot Corporation
Scott Paper Co. R. J. Reynolds Industries Inc.
American Petroleum Institute United States Steel Corp.
Richardson Merril Inc. Metropolitan Life Insurance Co.
May Department Stores Co. Norton-Simon Inc.
Sperry Rand Corporation Stone-Webster Inc.
San Salvador Development Company Standard Oil of Indiana
Federal Reserve Directors: A Study of Corporate and Banking Influence
– Published 1976
This chart shows the interlocks between the Federal Reserve Bank of New York J. Henry Schroder Banking Corp., J. Henry Schroder Trust Co., Rockefeller Center, Inc., Equitable Life Assurance Society ( J.P. Morgan), and the Federal Reserve Bank of Boston.
Alan Pifer, President
of New York
Trustee Interlocks ————————–
Rockefeller Center, Inc J. Henry Schroder Trust Company
The Cabot Corporation Paul Revere Investors, Inc.
Federal Reserve Bank of Boston Qualpeco, Inc.
Owens Corning Fiberglas
New England Telephone Co.
Fisher Scientific Company
Mellon National Corporation
Equitable Life Assurance Society
Twentieth Century Fox Corporation
J. Henry Schroder Banking Corporation
Federal Reserve Directors: A Study of Corporate and Banking Influence
– Published 1976
This chart shows the link between the Federal Reserve Bank of New York, Brown Brothers Harriman,Sun Life Assurance Co. (N.M. Rothschild and Sons), and the Rockefeller Foundation.
Maurice F. Granville
Chairman of The Board
Texaco Officer & Director Interlocks —————- Liggett & Myers, Inc.
L Arabian American Oil Company St John d’el Ray Mining Co. Ltd.
O | |
N Brown Brothers Harriman & Co. National Steel Corporation
D | |
O Brown Harriman & Intl’ Banks Ltd. Massey-Ferguson Ltd.
N | |
American Express Mutual Life Insurance Co.
N. American Express Intl’ Banking Corp. Mass Mutual Income Investors Inc.
M. | |
Anaconda United Services Life Ins. Co.
R | |
O Rockefeller Foundation Fairchild Industries
T | |
H Owens-Corning Fiberglas Blount, Inc.
S | |
C National City Bank (Cleveland) William Wrigley Jr. Co
H | |
I Sun Life Assurance Co. National Blvd. Bank of Chicago
L | |
D General Reinsurance Lykes Youngstown Corporation
General Electric (NBC) Inmount Corporation
** Source: Federal Reserve Directors: A Study of Corporate and Banking Influence. Staff Report,Committee on Banking,Currency and Housing, House of Representatives, 94th Congress, 2nd Session, August 1976.
NOTE: The Charts did not come out properly on the original document, so they could not be accurately reproduced – when an alternative source is found, they will be corrected)