dirty secrets of the temple: how the U.S. Federal Reserve and the banks run the world
http://www.voltairenet.org/article167747.html
20/07/2006
Stephen Lendman The Rebel
Years ago I read William Greider's excellent book, published in 1987 on the functioning of the Federal Reserve System of USA. Detailed and explicit, is a wonderful and informative reading, with the exception of the solution he suggests to a huge problem. It was far too timid. This article proposes a very different solution. Greider called his book "Secrets of the Temple" [Secrets of the Temple] with a subtitle: "How the Federal Reserve manages the country. "A better subtitle might have been like the Fed (and many other key central banks) run the world. This article attempts to summarize what it does, how it does, who benefits at the expense of whom. For those not aware, be prepared for information and comments surprising.
Let's be clear from the start. U.S. Federal Reserve, the Bank of England, Bank of Japan and the European Central Bank (of the 12 European countries that adopted the common European currency in 1999) are institutions with enormous power far beyond what we can imagine people somewhere in the world. These central banks, the most dominant all, and most others, have a powerful influence on financial conditions in virtually all countries, including of course his own in a financial world with fewer and fewer borders, where a major economic event a nation can affect, for better or for worse, most of them.
Another powerful bank is also part of the financial world. Has to be mentioned because of its importance, although it requires a separate article to explain more fully how it works. The Bank for International Settlements (BIS acronym in English), tight, inviolable and without liability to anyone, founded in 1930 and based in Basel, Switzerland. The bank, which most people never heard of, is the central bank to its member central banks - a kind of "boss of bosses" of the banks, equivalent to what apparently exists in the enigmatic world of Gifts the Mafia. Like most other central banks including the Federal Reserve (explained below), is privately owned by its members.
Some academics and others who have studied the BIS believe that the ruling elite of financial capitalism established this bank of banks to be in the top of the power to exercise its authority on the global financial system owned and controlled by it. It is thought that his plan was to use this bank to dominate the political system of every country and control the world economy from a feudal mode. In short, the idea is that this super-elite want to rule the world by controlling its money, and established that supranational all-powerful bank of banks to do so. However important, that discussion will be for another time, since the intent of this article is to focus only on the U.S. Federal Reserve.
dominant central banks and BIS, together with most others, exert their influence in cartel-like alliance with each other to ensure that everyone benefits more than it would if it were not for this comfortable arrangement. With their immense power is not playing with words if you say that these financial institutions certainly rule the world. Because they can create money, fund the needs of their governments, their militaries and all business activities, which could not function without a ready supply of such goods, the most necessary of all. Is money, not love, what makes the world go round, and central bankers have the power to create or remove from circulation more or less, according to taste and with the intention that comes to mind. It's the kind of power that can move mountains or destroy.
No national central bank is more powerful now that the Federal Reserve U.S., but it was not always so, and now faces competition for first place, which had not known since the Second World War. The Fed, as they call it, has existed since it was first established by an Act of Congress in 1913. But the Bank of England has existed since Britain controlled the seas, since 1694, when King William III needed help funding the kind of adventure that requires a lot of money available - the war. At that time was against France, and the king needed a friendly bank to print it for use, to help you fight. He also needed financial help to facilitate trade and manage the country's debt always increases when wars are fought. The Bank England was not the first central bank, but was the first privately owned central bank of the modern world in a powerful country. It was called the Bank of England to prevent the public to know that, like our Federal Reserve, was and remains privately owned and not part of government. It was also the model used in the formation of our own central bank and most others.
The British may have had an advantage of 219 years on the Fed, but central bankers are only as powerful as the countries they represent and their economies. Today the former dominant Brits must accept the lesser role of being just one of many lower members of a U.S. hegemon that emerged after the Second World War as the world's dominant economic power. Remain so today, though some credible experts believe this country may have reached the summit and is in decline. Some go further and say that our decline has been accelerated by the disastrous policies of the Bush administration that irrationally believes waging endless war against the world is the way to govern, to promote economic growth and endless domination, and thus preserving the nation's preeminent position as the reigning economic champion.
is easy to question this view and think champion has jumped into the ring a few times over, has endless plans to repeat their fighting, and probably will happen just as many previous characters who did not know when to quit and ended up with chronic brain damage known as dementia . The lesson of history is always the same. The price for reckless behavior is high, painful and inevitable. True for countries as well as individuals, but too often neither the one nor the other see it until too late. The biggest difference between USA Today and other nations of the past that paid dearly for not yielding when it was too late is that we have a powerful arsenal, like other nunca tuvieron. Si decidiéramos utilizarlo, probablemente no quedaría gran cosa para un sucesor. No es un pensamiento agradable, pero es muy real.
Todo comenzó en 1910 en la isla Jekyll
Suena como el título de una película de horror, pero los eventos de la vida real que ocurrieron en 1910 en esta isla de propiedad privada a poca distancia de la costa de Georgia habría sido un reto hasta para la imaginación de la fábrica de pesadillas de Hollywood.
En la isla Jekyll se reunieron en secreto durante nueve días siete hombres muy acaudalados y poderosos y crearon el Sistema de la Reserva Federal que nació tres años más tarde, el 23 de diciembre de 1913 mediante una ley del Congreso. Since then, the nation and the world would never be the same, only benefited the rich and powerful. That was it, and it worked as planned.
The Federal Reserve Act that gave birth is surely one of the most disastrous pieces of legislation for the public good that has ever been produced by a legislative body. May also have been and still is illegal according to Article 1, Section 8 of the Constitution which happens to be the inviolable law of the country. The article states that Congress shall have power to coin (create) money and regulate its value. In 1935 the U.S. Supreme Court ruled that Congress can not constitutionally delegate its power to another group or agency. Congress acted, therefore, in violation of the Constitution he swore to preserve and in doing so created the Federal Reserve System, as explained below, is a private corporation for profit that operates at the expense of public good. By its action, our lawmakers committed fraud against the people of the country and so far have gotten away with it without the public ever know the damage it has inflicted.
The shameful result is that it should never have come to see the light is now the most dominant institution in the world, and all because of what began on a privately owned island name creepy. But if Congress had acted responsibly, the law creating the Fed would never have been enacted. The legislation that established it was so damaging to the public interest, which probably would never have been approved had it not been channeled through a meeting of the Parliamentary Conference held at night between 1.30 and 4.30 am (while sleeping most Members of Congress) on 22 December 1913. The Act was passed the next day and passed although many members of the body had left for their Christmas holidays and most of those who were not had the time to read or knowing its contents. Sound familiar? But the passed (like a thief in the night) and was signed into law by Woodrow Wilson unconscious or accomplice, who later admitted he had made a terrible mistake, saying "unwittingly ruined my country." But it was too late to autopsy and the American people has paid dearly ever since. It is time for the public to understand and begin to demand an end to more than 90 years of damage.
That almost happened 43 years ago when one president decided to act on behalf of the people who elected him. That man was John Kennedy, who planned his death before the end of the Federal Reserve System to eliminate the national debt a central bank creates by printing money and lend to the government. That debt has now risen to more than 8,400,000,000,000 dollars must be paid by all taxpayers, who have done so for a sum amounting to nearly 174 billion dollars only in the first three months of 2006. This debt service is now an annualized amount exceeding two-thirds of a trillion dollars. Has enriched bankers (that was) and impoverished the public, because we collect taxes to pay the bill. It is no exaggeration to say that this is the biggest financial scam in world history that grows with each passing day.
debt was less onerous 40 years ago, but Kennedy understood the danger posed to the country and the burden imposed on the public. Therefore, the June 4, 1963, presidential order issued EO 11110 giving the president authority to issue currency. Then he ordered the U.S. Treasury to print 4,000 million dollars in "USA tickets" to replace the Federal Reserve. His intention was to replace them all when enough amount of new currency into circulation in order to end the Federal Reserve System and the control it gave the international bankers over the U.S. government and the public. Only months after the entry into force of the Kennedy plan, was killed in Dallas in what was surely a coup d'etat disguised to look like something else and it may have been made, at least in part, to save the Fed System and concentration of power that created it, so beneficial to the powerful bankers the country. Those who benefited had good reason to become involved in the conspiracy to protect the special privilege they were not willing to give up without a fight. It is a plausible explanation that could explain who may have been behind the murder and why. Whatever the truth, the banking cartel was only briefly troubled. Once Lyndon Johnson took office, he rescinded Kennedy's presidential order and restored the ancient power of the cartel. He has maintained since then and now, of course, is more powerful than ever. Even presidents are able to stop it and those who would try to do, have a lesson that gives the story to reflect.
The predecessors of the possible plotters of the coup against Kennedy were the men who met on Jekyll Island in 1910. Representing some of the most powerful men in the world - the Morgans, Rockefellers, Rothschilds of Europe (who dominated all European banking in the mid-nineteenth century and still could be the richest and most powerful family of all) and others of great influence and power. He was also a U.S. senator, a senior official Treasury, the president of the largest bank in the country at the time, a prominent figure on Wall Street and the man who later would become the first president of the Federal Reserve System. It was an extraordinary collection and were to get one. They wanted to change the ideology and course of business Americans, who until then were based on competition in the market and replaced by the monopoly. They also knew what he meant when Baron MA Rothschild said: "Give me control over a nation's currency and I care not who makes its laws." They knew the wisdom of what it says in Proverbs 22:7: "The rich rule of the poor and the borrower is servant to the lender. "
was the dawn of the age of powerful cartels when the seven financial titans meeting secretly in the house of the island club decided not to compete between them and demanded the power to fix it. They were already colluding informally but knew that everything would work better if it took place under a sign legally guaranteed. They wanted a banking cartel and got one that flourishes today below the public radar with the tool they wanted most - the ability to control the money supply in the nation, which gave them almost unlimited power. The cartel now works in cooperation with Governments and all other powerful transnational corporations in a dominant global alliance that allows them to control markets, resources, cheap labor in the world and our lives.
The Federal Reserve System is not a government agency - is a privately owned cartel of powerful banks protected by law.
commonly believed, but erroneously, that the Federal Reserve System is a governmental function and under its control. Is false. We often talk of a decentralized central bank, quasi-governmental, but it is just a cover to disguise what it really is: a sign of ownership and private operation is presented as if the government were in charge. The fact that his office is in Washington in the formidable and impressive Eccles building (named after a former Fed chairman) is just part of the clever subterfuge. Works as follows:
The Fed is composed of a Board of Governors in Washington and 12 regional banks in major cities around the country (including my own city of Chicago where anyone used to, but I can not go an ATM and buy U.S. Treasury securities). The system also includes many and various member banks, including all national banks that have to be part of the system. It also allows other banks to join and many did. The Federal Reserve began operations in November de 1914, casi un año después de la ley parlamentaria que creó el sistema el año anterior. Recibió mandato legal para poseer el mayor poder de cualquier institución del país – el poder de crear y controlar su suministro de dinero.
La mayoría de la gente sabe poco o nada sobre el dinero y la banca, probablemente nunca piensa en el tema, y no tiene la menor idea de cómo lo que hacen la Fed y los banqueros afecta sus vidas. Antes de escribir este artículo, tenía un poco más de los modestos conocimientos que aprendí en un curso obligatorio sobre el tema y contabilidad básica como parte de mi plan de estudios para la maestría de administración empresarial, hace 46 años. Esos cursos put aside the most important parts of the story and never hinted that there might be something sinister in the actual functioning of the banking system. But nobody should imagine that the banks were established to work on their behalf or that we wanted to do so. Obviously not, and anyone who suggested that it is, should read as follows. Are so beneficial to the public welfare as was the MX Peacekeeper ICBM (the clever language is impressive) to be carrying nuclear warheads in the mid-eighties and had the power to destroy all life on the planet and could still do in its old form or modernized.
Law Federal Reserve (the law of the land) stipulates that the Federal Reserve Banks of each region are owned by their member banks. These Fed banks are privately owned corporations that make a great effort to conceal that they actually own what much of the public thinks that is part of the public treasury and government. It's easy to think because the Fed chairmen and seven of the twelve Governors are appointed by the president and approved by the Senate. As such, the BRF is a kind of quasi-governmental entity, but the fact is that the system is private property for private benefit or any other company. Have other public shareholders, who receive a 6% risk free interest every year on their equity.
The public is ignorant, and probably would not be good PR if it found out. People might get upset even if he knew that some of the owners of our Federal Reserve are powerful foreign investors in the UK, France, Germany, Holland and Italy. Are partners of giant U.S. banks like JP Morgan Chase and Citibank as well as powerful Wall Street firms like Goldman Sachs banker in a sign of the new world order that influences and affects business everywhere and our lives.
The problem of private ownership of the Federal Reserve Banks has been challenged several times in federal court in vain. Each time the courts upheld the current system under which each Federal Reserve bank is a separate corporation owned by commercial banks in their region. A similar case was that of Lewis v. U.S. was decided by the 9th Circuit Court of Appeals ruled that the Reserve Banks are independent corporations, privately owned and locally controlled.
the nation's founders had different American Horatio Alger powerful ideas that met at the Jekyll Island
Through our history, there was disagreement over who should control the money supply of the nation and the right emitting. The Founding Fathers understood that the American Horatio Alger British Parliament was forced to levy unfair to the American colonies and its own citizens because the Bank of England had accumulated so much debt the government needed revenue to reduce it. Benjamin Franklin, in fact, thought that was the real cause of the American Revolution. Most of the Founders also understood the danger that could result if the bankers accumulated too much wealth and power. James Madison, the chief editor of our Constitution, called "money changers", referring to the Bible that Jesus drove the money changers twice the Temple of Jerusalem 2,000 years ago. Madison said:
"History tells us that the money changers have used every possible means of abuse, intrigue, deceit and violence to maintain their control over governments by controlling money and its issuance."
Thomas Jefferson used the same energy in his condemnation when he said:
"I sincerely believe that banking institutions are more dangerous to our liberties than standing armies. Have created a moneyed aristocracy that has challenged the government. The issuing power should be taken from the banks and restored to those who properly belongs. "
Jefferson and Madison understood the dangers of commercial monopolies of all kinds and tried to ensure that never exist in the new nation. They, in fact, wanted to add two additional amendments to the Declaration of Rights in the Constitution, but never succeeded. They believed that to protect the freedom of the people the nation should be "free from monopolies in commerce" (what are now giant corporations including the big international banks and investment firms on Wall Street) and "free of armed forces permanent, "or standing armies strength. Try to imagine how the country would be today if Jefferson and Madison would have been - a country without giant predatory corporations exploiting everyone for profit and no armed forces are rampant that the world war, threatening to destroy it and make it for corporate giants to get even greater benefits.
never succeeded, by the way, and people have paid dearly ever since including the great harm caused because the government relinquished its right to control the money supply in the nation. Gave it secretly without the public knowing it, ignorant of the harm he had done. Has been even worse since the eighties, because the power of the Fed raised under a president Republican friend, and the racket run by the corporate media hid the effect. For them it is unacceptable that the Fed is degraded in public, and its giant member banks or Wall Street allies.
Things got out especially during the performance of Alan Greenspan. Surprising that there has been one to find many reasons to praise such a Fed chairman before to lead the Fed, when he was a presidential adviser, or during the period in which he directed. Only entered government service after the failure of its financial consulting firm, probably because I needed a new line of work. There he managed to become prophet in a lush central bank was almost elevated to sainthood by the business experts who thought that under the exercise were only blue skies and few clouds in sight always predicted that the sun shine again. Now Alan is retired to the more fertile horizons book contracts and conferences, which shows that if you work well for the rich and powerful that allows it, (at the expense of other people) the final reward will be worth . It is likely that the new Fed chairman has taken note and will try to continue the tradition accordingly.
But try to imagine a different kind of Fed chairman, someone who knew, have faith in and practiced the words and wisdom of another American president of some importance: Abraham Lincoln. In 1886 Lincoln said: "The money powers prey on the nation in times of peace and conspire against it in times of adversity. It is more despotic than a monarch, more insolent than autocracy and more selfish than a bureaucracy. They denounce as public enemies all who question its methods or throw light upon its crimes. I have two great enemies, the Southern Army in front of me and the bankers behind. Of the two, who is back is my biggest enemy. "
seems that Lincoln also said (although some dispute it): "I see approaching in the near future a crisis that worries me and makes me tremble for the safety of my country ... corporations have been enthroned and an era of corruption in high office, and the power of money the country will endeavor to prolong its reign by using the prejudices of the people until all wealth is concentrated in a few hands and the Republic is destroyed. "Imagine what Lincoln would say today.
What Lincoln thought of the bankers and money power in the country, seems to raise the obvious question: Did they have something to do, or were the reason for his untimely death at the hands of John Wilkes Booth? International bankers obviously hated Lincoln after he got Congress to approve the Law of the legal currency of authorizing the U.S. Treasury to issue paper money called "greenbacks" [green]. Lincoln needed this legislation after he resigned to pay bankers usurious interest rates of between 24 and 30% that required for loans needed to finance their war with the south. With the new banking law, Lincoln was able to print the millions of dollars needed, free of debt and interest. This was not, obviously, what the greedy bankers wanted as they can only take away their benefits when carrion piece of financial transactions they control. Lincoln was assassinated shortly after the end of the war, and a little later rescinded the so-called law "Greenback" [Green], adopted a new banking law, and all money returned to produce interest.
How the Federal Reserve System.
The Federal Reserve System is that Congress and the President agreed to privatize the nation's money system and relinquish the power that should have remained the exclusive right of the government. That act was so outrageous the Fed had to be deliberately structured to look like a federal government delegation to hide that reality is all-powerful banking cartel private property whose member banks (including any national) share the vast benefits of having the license should be more important than government-exclusive right to print money in any amount, control its supply and price, and delivery mode benefit immensely in exchange for a benefit, including the government itself that must pay interest on the money, which would never be necessary if you just printed. Consider what would happen if the government legalized the right to counterfeit the national currency for private gain. It is no exaggeration to say that is the biggest financial scam of all time, causing incomprehensible harm to a public that still does not know. Works as follows:
The Fed received the authority to conduct monetary policy in the nation with the power to control the supply and price of the currency. You have three ways to do it - through open market operations, the benchmark rate it charges member banks and the reserve requirement percentage of member banks assets it requires them to maintain their power and not be paid . The Governing Council is responsible for managing the reference rate and reserve requirements while the Federal Open Market Committee (FOMC, for its acronym in English) is responsible for open market operations or purchase sale of obligations explained later. Using these instruments, the Fed can influence the supply and demand for money and thus directly control short-term rate of federal funds is always fixed unless the Fed wishes to raise or lower it. Longer-term rates are controlled by the powerful institutional traders in the bond market.
The FOMC and how
The Federal Open Market Committee is really key to the whole process of money creation or contraction. Consists of 12 members - seven members of the Board of Governors of the Fed, the president of the New York Fed Bank (the most important of all) and four other 11 presidents of the Bank Reserve to serve in shifts over the year. The FOMC performs eight regularly scheduled meetings a year to assess economic conditions and decide what is comfortable or has to be strict monetary policy to boost its stated goal of sustainable economic growth and price stability.
Literally, the FOMC has the power to create money from nothing. It does so through a process of four stages: Stage
: The FOMC approved the purchase of U.S. government bonds on the open market.
Second stage: The New York Fed Bank acquires obligations to the sellers (financial markets always have an equal number of buyers and sellers).
Third stage: The Fed pays for its purchases with electronic credits to the sellers bank, in turn, credit the sellers' bank accounts. These credits are literally created out of nothing.
Fourth Stage: The banks receiving the credits can then use them as reserves to enable them to pay up to 10 times their amount (if their reserve requirement is 10%) through the magic (only banks have) of banking fractional reserve and, of course, charge interest on the total. What a deal! and everything is legal. Imagine how rich we might all be if we could do the same as private individuals. We borrowed one million to the Fed, as if by magic, we multiply by 10, and charge interest on the total, with the exception of 10% that we must keep in reserve. It's the magic of the creation of fractional reserve money and explains how powerful an economic stimulus when the Fed wants to enhance economic growth.
When the Fed wishes to contract the economy by reducing the money supply simply reverses the above process. Instead of buying bonds, sell them so the money comes from the buyers bank accounts instead of joining them. Then, bank loans have to be reduced 10 times if the reserve requirement is 10%.
How the Fed harms the public interest
The Federal Reserve System exists only to serve its owners and its member banks and in doing so is hostile to the public interest. That's because it is a banking cartel with the power to restrict competition by higher profits at our expense. Out of our pockets to theirs, and the public loses in four ways: First
: Through the invisible tax of inflation that results from the dilution of purchasing power caused by the entrance to the newly created money system, which which reduces the value of the dollars that are already present. The Greenspan Fed was especially expansive, never was blamed for its excess and was able to pass on the serious problem it created a future Fed chairman and society to face it. The man who now extol as a monetary magician began sensibly. Since 1982, before he arrived in 1987, until 1992, the money supply increased by an average of 8% per year. But from 1992 to 2002, printing presses worked overtime in sync with the deregulation and growth of global markets, expanding the currency by more than 12% per year. It became even more extreme after the 11-S and since 2002 grew at a rate of 15%. Now has more than doubled in less than a decade. It seems that the new Fed chairman has taken note and begun to slow the pace of monetary expansion and continues to increase the federal funds rate to whatever level you have in mind.
Currency traders also appear to have taken note of the overall expansion rate of the money supply. With the exception of a break in 2005, it is likely that the weakness of the dollar since 2002 is the result of excessive wasteful spending created by the Bush administration to fund its endless wars and reckless tax cuts for the rich. The problem is further complicated because from 1964 to the present debt service has grown from 9 to 16.5% of the federal budget and rising, and the current deficit has gone from a surplus of 1% to almost 7% deficit, federal debt has grown by 40% just since 2001 and has been funded in large part by "the kindness of strangers" that may be losing the nerves. Moreover, since March 2006, the Fed stopped publishing M-3 the sum of total dollars in circulation. Without such transparency, now big buyers of U.S. Treasury obligations have to calculate the value of the dollar based on speculation and uncertainty rather than data safe - not something that inspires confidence in financial markets that function best in an atmosphere of openness and clarity.
Second: The public also loses because the banking cartel can practice usury - from his power over a flexible currency to artificially raise or lower rates at whatever level they choose what many small lenders can not do in a truly free and open market. Moreover, the domination of the market by the cartel forces most borrowers (especially smaller ones who are least able to issue their own debt instruments) to ask for loans that can then be done using what should be the money people, made available at the lowest cost possible for many small lenders heavily regulated by the government, which would compete in search of clients.
Third, through taxation, we the public have to pay to cover the interests of the vast national debt (now over $ 8.4 trillion) accumulated from the money the Fed printed and loaned to the government. As noted earlier, now totals an annualized amount exceeding two-thirds of a trillion dollars and increasing daily. Has enriched bankers, impoverished the ordinary people and the public still does not know that he is being fleeced big. Fourth
: Compounding the above abuse, the cartel can make the public bail out the system more taxpayer dollars. This happens every Once one of the banks too big to be allowed to fail need financial help to survive. The same applies to big corporations like Chrysler or Lockheed, large investment firms or hedge funds like Long-Term Capital Management or even countries like Mexico. Also applies when you close a single bank and you have to compensate depositors or, more seriously, after a systemic financial crisis like the one that wiped out many savings and loan banks in the eighties. Be a single bank or many dozens at the same time, public tax dollars are used to save the system or just to pay the bill to reimburse depositors insured against losses insurance for government protection to a certain amount per account.
How Adam Smith would have reacted to the Federal Reserve System?
This concentration of wealth and power of the banking cartel is the opposite of what Adam Smith, the ideological godfather of free market capitalism, advocated in his writings, including his seminal work "The Wealth of Nations." Smith wrote about an "invisible hand" that he said worked best in a free market with many local small businesses competing against each other. Strongly opposed the concentrated mercantilism of his time (whatever it was) that currently would the equivalent of our giant corporations and the banking cartel with the power to restrict competition, maintain higher prices than would have been possible otherwise, and as a result, earn higher profits at the expense of the public.
The type of banking cartel that exists today is precisely what Smith would have condemned. But there is a central bank is not bad in itself if the bank is government owned, controlled and operated according to the public good. Only a problem when through subterfuge the bank down so it looks as if it were owned and operated by him, when in fact, works on the basis of private interest in our case and in most others. And in USA, to operate the rigging, the system is managed by a governing body appointed mostly by the government, which acts as a pimp for members of the greedy private banking cartel that was the first to want to exist and that a corrupt Congress did put it to them. To work, the cartel needs the cover that gets as a result of its partnership with the government, but it hurts the public interest because this structure to serve his own private gain.
And so we come to the crux of the problem: the Congress elected to serve the people, betrayed him instead of fulfilling his duty to create a powerful banking cartel and grant the authority to practice fractional reserve banking with the power to get free money by creating it from scratch. Then allowed its members a near-monopoly right to set interest rates charged to borrowers want. The whole process amounts to a legally sanctioned heist by the powerful banks operating in cahoots with the government for their own benefits. Is also part of a broader process organized by the government to transfer wealth from the people to the pockets of large corporations and the wealthy, while those affected do not know they even occur.
Reserve System Federal also harms the public in another way:
The Fed harms the public good in another important way, and again most people do not have the slightest idea. The Federal Reserve System was supposedly established to stabilize the economy, smooth over the business cycle, maintain a healthy rate of sustainable growth while maintaining stability of prices and benefits everyone. Have you done your job? Since its inception in 1913, we had the superstars of 1921 and the most important and remembered in 1929. It was followed by the Great Depression that lasted until the beginning of World War II, which according to the noted conservative economist Milton Friedman was caused and exacerbated because the Federal Reserve decided surprisingly reducing money supply in times of economic contraction instead of increasing it. We then had recessions in 1953, 1957, 1969, 1975, 1981, 1990 and 2001. We also had inflation beginning in the sixties. This was quite severe through much of the seventies and early eighties. And we had a major banking crisis in the eighties in which more banks and bankrupt savings and loans than ever before in our history. It happened after the financial market deregulation, banks were permitted to pursue their own interests without supervision governmental control his inclination to take risks that would prevent excessive or try to get away with deliberate fraud.
Along with economic stability the Fed never achieved, also has boosted consumer debt, budget deficits and record trade, a high number of personal bankruptcies and rising mortgage crimes, a growing interest on debt national accounts for a large and growing federal budget, the loss of our manufacturing base and jobs with high wages because they are exported to low wage countries, an economy in which services now account for about 80% of all businesses that pay the most poorly, with less skilled jobs with little or no benefits, and an increasing gap in income and wealth that is hurting people on low or medium proceeds to benefit the few rich and wealthy, and a government that is driving this situation.
Everything is summarized in one conclusion: The Fed did not comply, above all, the essential task for which it was set to begin. But much worse, if we understand the true motives of a cartel. Is not to serve the public interest. You abuse it, because that increase profits. You can do this with the concentration of power, legally sanctioned, and a friendly government in league with their partners or facilitators. It comes with it when you make the most splendid of theft with this rigging hidden from public view.
A necessary solution to a huge problem.
is clear from the information submitted to the Federal Reserve System was established through stealth and deceit by a handful of corrupt politicians to serve their powerful allies in the banking and Wall Street. They did it to defraud the public and if it has not had the slightest idea what was happening, and how damaging it was for their welfare and interest. Those in Congress and President Wilson (A man trained in law, former practicing attorney, former esteemed academic and president of Princeton University) either knew or should have known that the law that he and they approved establishing the Fed was in direct violation of the Constitution they had sworn to defend . They did not, and violated the law, and the public paid dearly for his crime since then until today.
So, what recourse is left, and it is possible to mobilize people to follow up? There is only one sensible and just solution to undo the damage has been done so many for so long: to abolish the Federal Reserve System and restore the power it currently has a Federal Government working for the public good. Retrieve the powerful banking cartel working against it and not return to never let slip back into their hands. It is the only way. The great German poet and playwright Bertolt Brecht would have agreed when he said "easier to rob a bank setting rounds."
Releasing the power of these powerful "money changers" would bring enormous benefits for all. Establish a prudent policy of money creation that would minimize our most unfair tax - inflation which is caused by private bankers in pursuit of profit that manipulate the money supply in the nation to increase them. Estabilizaría la economía y suavizaría los extremos en el ciclo de la coyuntura agudizados por el cartel que trabaja para su propio beneficio y contra el nuestro. Reduciría el coste del dinero para los prestatarios porque terminaría con el poder monopolista que tiene actualmente el cartel de establecer las tasas que prefiere, abriendo el mercado a más competencia. Reduciría la creciente y opresora deuda nacional al ser por fin liberada del aumento del suministro de dinero requerido para pagarla. Reduciría la carga tributaria para el público ya que se necesitarían menos ingresos para el servicio de la deuda. Sería un paso trascendental hacia la reducción del poder abrumador de todos los gigantes corporativos depredadores que nos exploited in order to grow and prosper, and hopefully end up deleting it. It could even serve as deterrent to wars that only fought for wealth and power - never for glory or to make the world safe for democracy or other false motives. Without a powerful banking cartel and other industry giants that live off human misery they create, there would be less need for any war. Try to imagine such a world and a government that works for the public welfare instead of harming it as it does now to serve the capital. That world is possible, and responsible people have to work for it, because we now have has failed and must be changed before it is too later. A world view created by the interests of capital and our government supports it. The disturbing
, corrupted world of neoliberal capitalism "free market" controlled by giant corporations, which benefits only the privileged few and causes so much misery and despair, a despotic world that can not last, nor should we allow that last much longer , in which endless wars for power and profits, in which people are a commodity used as needed and discarded like trash when it is not, without concern for preserving an ecology able to sustain us, not what will continue much longer because we're destroying, and ourselves for profit; in which basic human needs do not matter under an economic model in which private benefit is only worth, in which democracy is incompatible with predatory capitalism, in which no should want to live or have to do, where we must change or die. In the language of capital, is the bottom line. Only a mass movement of committed people can change the world. Must end or we will end all.
Unless we can move from our failed economic model to a better alternative will end when the day comes one way or another. But it could be an outcome that anyone could wish - their self-destruction that takes everything with him, either by nuclear holocaust or an environment so inhospitable that does not allow us to live in it. Our only chance is to work for change while there is time.
A vision of a different world., History proves a better world is possible when committed people work hard enough for it. Thus ended slavery, the workers won the right to organize and collective bargaining, women achieved the same voting rights as men control over their own bodies, and more rights and status in the labor force, blacks and other minorities won important civil rights, and state policies important social legislation even though it was only for fear of what might happen if they did.
Thomas Jefferson explained that "the price of freedom is eternal vigilance." It's the same price to pay to maintain our social gains achieved with such difficulty. In the past generation those gains have eroded while not paying attention and only mass action can rescue the people. The goal should be a humane world of participation in which people's lives improve because we all work together to achieve: a world of peace, not endless wars to benefit the rich and powerful at our expense, in which all needs essential human are met because governments work for the common good to secure it, with real participatory democracy where the public and elected officials work together to keep it strong and vibrant, no oppressive corporate giants or banking cartels because the law does not allow them; in which nutrition and ecological preservation is a central concern, in which air, water, pure soil and adequate food and safe, a world much simpler, with a more local than at present, in which notions such as globalization or even part of the vocabulary, a world based on social equity and justice for all, governments, maintenance enforcement and the courts working to ensure that it remains so, a world where all want to live and hopefully some day we can, a world we want to bequeath to future generations a world that we can not fail to achieve because the alternative may be nothing.
may find ourselves at a crucial moment where our fate is at stake. Either we work together for a better, sustainable or likely we will become the first species to be self-destructs. If it happens, we'll probably take most of the others with us and not leave much to the few that remain. We no longer have the luxury to discuss the kind of world we need to survive. The giant banks and corporations not provide us, nor will a hostile government allied with them. Depends on us that we will achieve or is likely to succumb if we fail. It would be a good start if you drive them from our church to the "money changers" from the Federal Reserve and with them the giant corporations. A better world is possible if we remember and live according to Antonio Gramsci's inspirational words about "the optimism of the will." With your help, organized people can find a way to beat organized money.
http://www.voltairenet.org/article167747.html
20/07/2006
Stephen Lendman The Rebel
Years ago I read William Greider's excellent book, published in 1987 on the functioning of the Federal Reserve System of USA. Detailed and explicit, is a wonderful and informative reading, with the exception of the solution he suggests to a huge problem. It was far too timid. This article proposes a very different solution. Greider called his book "Secrets of the Temple" [Secrets of the Temple] with a subtitle: "How the Federal Reserve manages the country. "A better subtitle might have been like the Fed (and many other key central banks) run the world. This article attempts to summarize what it does, how it does, who benefits at the expense of whom. For those not aware, be prepared for information and comments surprising.
Let's be clear from the start. U.S. Federal Reserve, the Bank of England, Bank of Japan and the European Central Bank (of the 12 European countries that adopted the common European currency in 1999) are institutions with enormous power far beyond what we can imagine people somewhere in the world. These central banks, the most dominant all, and most others, have a powerful influence on financial conditions in virtually all countries, including of course his own in a financial world with fewer and fewer borders, where a major economic event a nation can affect, for better or for worse, most of them.
Another powerful bank is also part of the financial world. Has to be mentioned because of its importance, although it requires a separate article to explain more fully how it works. The Bank for International Settlements (BIS acronym in English), tight, inviolable and without liability to anyone, founded in 1930 and based in Basel, Switzerland. The bank, which most people never heard of, is the central bank to its member central banks - a kind of "boss of bosses" of the banks, equivalent to what apparently exists in the enigmatic world of Gifts the Mafia. Like most other central banks including the Federal Reserve (explained below), is privately owned by its members.
Some academics and others who have studied the BIS believe that the ruling elite of financial capitalism established this bank of banks to be in the top of the power to exercise its authority on the global financial system owned and controlled by it. It is thought that his plan was to use this bank to dominate the political system of every country and control the world economy from a feudal mode. In short, the idea is that this super-elite want to rule the world by controlling its money, and established that supranational all-powerful bank of banks to do so. However important, that discussion will be for another time, since the intent of this article is to focus only on the U.S. Federal Reserve.
dominant central banks and BIS, together with most others, exert their influence in cartel-like alliance with each other to ensure that everyone benefits more than it would if it were not for this comfortable arrangement. With their immense power is not playing with words if you say that these financial institutions certainly rule the world. Because they can create money, fund the needs of their governments, their militaries and all business activities, which could not function without a ready supply of such goods, the most necessary of all. Is money, not love, what makes the world go round, and central bankers have the power to create or remove from circulation more or less, according to taste and with the intention that comes to mind. It's the kind of power that can move mountains or destroy.
No national central bank is more powerful now that the Federal Reserve U.S., but it was not always so, and now faces competition for first place, which had not known since the Second World War. The Fed, as they call it, has existed since it was first established by an Act of Congress in 1913. But the Bank of England has existed since Britain controlled the seas, since 1694, when King William III needed help funding the kind of adventure that requires a lot of money available - the war. At that time was against France, and the king needed a friendly bank to print it for use, to help you fight. He also needed financial help to facilitate trade and manage the country's debt always increases when wars are fought. The Bank England was not the first central bank, but was the first privately owned central bank of the modern world in a powerful country. It was called the Bank of England to prevent the public to know that, like our Federal Reserve, was and remains privately owned and not part of government. It was also the model used in the formation of our own central bank and most others.
The British may have had an advantage of 219 years on the Fed, but central bankers are only as powerful as the countries they represent and their economies. Today the former dominant Brits must accept the lesser role of being just one of many lower members of a U.S. hegemon that emerged after the Second World War as the world's dominant economic power. Remain so today, though some credible experts believe this country may have reached the summit and is in decline. Some go further and say that our decline has been accelerated by the disastrous policies of the Bush administration that irrationally believes waging endless war against the world is the way to govern, to promote economic growth and endless domination, and thus preserving the nation's preeminent position as the reigning economic champion.
is easy to question this view and think champion has jumped into the ring a few times over, has endless plans to repeat their fighting, and probably will happen just as many previous characters who did not know when to quit and ended up with chronic brain damage known as dementia . The lesson of history is always the same. The price for reckless behavior is high, painful and inevitable. True for countries as well as individuals, but too often neither the one nor the other see it until too late. The biggest difference between USA Today and other nations of the past that paid dearly for not yielding when it was too late is that we have a powerful arsenal, like other nunca tuvieron. Si decidiéramos utilizarlo, probablemente no quedaría gran cosa para un sucesor. No es un pensamiento agradable, pero es muy real.
Todo comenzó en 1910 en la isla Jekyll
Suena como el título de una película de horror, pero los eventos de la vida real que ocurrieron en 1910 en esta isla de propiedad privada a poca distancia de la costa de Georgia habría sido un reto hasta para la imaginación de la fábrica de pesadillas de Hollywood.
En la isla Jekyll se reunieron en secreto durante nueve días siete hombres muy acaudalados y poderosos y crearon el Sistema de la Reserva Federal que nació tres años más tarde, el 23 de diciembre de 1913 mediante una ley del Congreso. Since then, the nation and the world would never be the same, only benefited the rich and powerful. That was it, and it worked as planned.
The Federal Reserve Act that gave birth is surely one of the most disastrous pieces of legislation for the public good that has ever been produced by a legislative body. May also have been and still is illegal according to Article 1, Section 8 of the Constitution which happens to be the inviolable law of the country. The article states that Congress shall have power to coin (create) money and regulate its value. In 1935 the U.S. Supreme Court ruled that Congress can not constitutionally delegate its power to another group or agency. Congress acted, therefore, in violation of the Constitution he swore to preserve and in doing so created the Federal Reserve System, as explained below, is a private corporation for profit that operates at the expense of public good. By its action, our lawmakers committed fraud against the people of the country and so far have gotten away with it without the public ever know the damage it has inflicted.
The shameful result is that it should never have come to see the light is now the most dominant institution in the world, and all because of what began on a privately owned island name creepy. But if Congress had acted responsibly, the law creating the Fed would never have been enacted. The legislation that established it was so damaging to the public interest, which probably would never have been approved had it not been channeled through a meeting of the Parliamentary Conference held at night between 1.30 and 4.30 am (while sleeping most Members of Congress) on 22 December 1913. The Act was passed the next day and passed although many members of the body had left for their Christmas holidays and most of those who were not had the time to read or knowing its contents. Sound familiar? But the passed (like a thief in the night) and was signed into law by Woodrow Wilson unconscious or accomplice, who later admitted he had made a terrible mistake, saying "unwittingly ruined my country." But it was too late to autopsy and the American people has paid dearly ever since. It is time for the public to understand and begin to demand an end to more than 90 years of damage.
That almost happened 43 years ago when one president decided to act on behalf of the people who elected him. That man was John Kennedy, who planned his death before the end of the Federal Reserve System to eliminate the national debt a central bank creates by printing money and lend to the government. That debt has now risen to more than 8,400,000,000,000 dollars must be paid by all taxpayers, who have done so for a sum amounting to nearly 174 billion dollars only in the first three months of 2006. This debt service is now an annualized amount exceeding two-thirds of a trillion dollars. Has enriched bankers (that was) and impoverished the public, because we collect taxes to pay the bill. It is no exaggeration to say that this is the biggest financial scam in world history that grows with each passing day.
debt was less onerous 40 years ago, but Kennedy understood the danger posed to the country and the burden imposed on the public. Therefore, the June 4, 1963, presidential order issued EO 11110 giving the president authority to issue currency. Then he ordered the U.S. Treasury to print 4,000 million dollars in "USA tickets" to replace the Federal Reserve. His intention was to replace them all when enough amount of new currency into circulation in order to end the Federal Reserve System and the control it gave the international bankers over the U.S. government and the public. Only months after the entry into force of the Kennedy plan, was killed in Dallas in what was surely a coup d'etat disguised to look like something else and it may have been made, at least in part, to save the Fed System and concentration of power that created it, so beneficial to the powerful bankers the country. Those who benefited had good reason to become involved in the conspiracy to protect the special privilege they were not willing to give up without a fight. It is a plausible explanation that could explain who may have been behind the murder and why. Whatever the truth, the banking cartel was only briefly troubled. Once Lyndon Johnson took office, he rescinded Kennedy's presidential order and restored the ancient power of the cartel. He has maintained since then and now, of course, is more powerful than ever. Even presidents are able to stop it and those who would try to do, have a lesson that gives the story to reflect.
The predecessors of the possible plotters of the coup against Kennedy were the men who met on Jekyll Island in 1910. Representing some of the most powerful men in the world - the Morgans, Rockefellers, Rothschilds of Europe (who dominated all European banking in the mid-nineteenth century and still could be the richest and most powerful family of all) and others of great influence and power. He was also a U.S. senator, a senior official Treasury, the president of the largest bank in the country at the time, a prominent figure on Wall Street and the man who later would become the first president of the Federal Reserve System. It was an extraordinary collection and were to get one. They wanted to change the ideology and course of business Americans, who until then were based on competition in the market and replaced by the monopoly. They also knew what he meant when Baron MA Rothschild said: "Give me control over a nation's currency and I care not who makes its laws." They knew the wisdom of what it says in Proverbs 22:7: "The rich rule of the poor and the borrower is servant to the lender. "
was the dawn of the age of powerful cartels when the seven financial titans meeting secretly in the house of the island club decided not to compete between them and demanded the power to fix it. They were already colluding informally but knew that everything would work better if it took place under a sign legally guaranteed. They wanted a banking cartel and got one that flourishes today below the public radar with the tool they wanted most - the ability to control the money supply in the nation, which gave them almost unlimited power. The cartel now works in cooperation with Governments and all other powerful transnational corporations in a dominant global alliance that allows them to control markets, resources, cheap labor in the world and our lives.
The Federal Reserve System is not a government agency - is a privately owned cartel of powerful banks protected by law.
commonly believed, but erroneously, that the Federal Reserve System is a governmental function and under its control. Is false. We often talk of a decentralized central bank, quasi-governmental, but it is just a cover to disguise what it really is: a sign of ownership and private operation is presented as if the government were in charge. The fact that his office is in Washington in the formidable and impressive Eccles building (named after a former Fed chairman) is just part of the clever subterfuge. Works as follows:
The Fed is composed of a Board of Governors in Washington and 12 regional banks in major cities around the country (including my own city of Chicago where anyone used to, but I can not go an ATM and buy U.S. Treasury securities). The system also includes many and various member banks, including all national banks that have to be part of the system. It also allows other banks to join and many did. The Federal Reserve began operations in November de 1914, casi un año después de la ley parlamentaria que creó el sistema el año anterior. Recibió mandato legal para poseer el mayor poder de cualquier institución del país – el poder de crear y controlar su suministro de dinero.
La mayoría de la gente sabe poco o nada sobre el dinero y la banca, probablemente nunca piensa en el tema, y no tiene la menor idea de cómo lo que hacen la Fed y los banqueros afecta sus vidas. Antes de escribir este artículo, tenía un poco más de los modestos conocimientos que aprendí en un curso obligatorio sobre el tema y contabilidad básica como parte de mi plan de estudios para la maestría de administración empresarial, hace 46 años. Esos cursos put aside the most important parts of the story and never hinted that there might be something sinister in the actual functioning of the banking system. But nobody should imagine that the banks were established to work on their behalf or that we wanted to do so. Obviously not, and anyone who suggested that it is, should read as follows. Are so beneficial to the public welfare as was the MX Peacekeeper ICBM (the clever language is impressive) to be carrying nuclear warheads in the mid-eighties and had the power to destroy all life on the planet and could still do in its old form or modernized.
Law Federal Reserve (the law of the land) stipulates that the Federal Reserve Banks of each region are owned by their member banks. These Fed banks are privately owned corporations that make a great effort to conceal that they actually own what much of the public thinks that is part of the public treasury and government. It's easy to think because the Fed chairmen and seven of the twelve Governors are appointed by the president and approved by the Senate. As such, the BRF is a kind of quasi-governmental entity, but the fact is that the system is private property for private benefit or any other company. Have other public shareholders, who receive a 6% risk free interest every year on their equity.
The public is ignorant, and probably would not be good PR if it found out. People might get upset even if he knew that some of the owners of our Federal Reserve are powerful foreign investors in the UK, France, Germany, Holland and Italy. Are partners of giant U.S. banks like JP Morgan Chase and Citibank as well as powerful Wall Street firms like Goldman Sachs banker in a sign of the new world order that influences and affects business everywhere and our lives.
The problem of private ownership of the Federal Reserve Banks has been challenged several times in federal court in vain. Each time the courts upheld the current system under which each Federal Reserve bank is a separate corporation owned by commercial banks in their region. A similar case was that of Lewis v. U.S. was decided by the 9th Circuit Court of Appeals ruled that the Reserve Banks are independent corporations, privately owned and locally controlled.
the nation's founders had different American Horatio Alger powerful ideas that met at the Jekyll Island
Through our history, there was disagreement over who should control the money supply of the nation and the right emitting. The Founding Fathers understood that the American Horatio Alger British Parliament was forced to levy unfair to the American colonies and its own citizens because the Bank of England had accumulated so much debt the government needed revenue to reduce it. Benjamin Franklin, in fact, thought that was the real cause of the American Revolution. Most of the Founders also understood the danger that could result if the bankers accumulated too much wealth and power. James Madison, the chief editor of our Constitution, called "money changers", referring to the Bible that Jesus drove the money changers twice the Temple of Jerusalem 2,000 years ago. Madison said:
"History tells us that the money changers have used every possible means of abuse, intrigue, deceit and violence to maintain their control over governments by controlling money and its issuance."
Thomas Jefferson used the same energy in his condemnation when he said:
"I sincerely believe that banking institutions are more dangerous to our liberties than standing armies. Have created a moneyed aristocracy that has challenged the government. The issuing power should be taken from the banks and restored to those who properly belongs. "
Jefferson and Madison understood the dangers of commercial monopolies of all kinds and tried to ensure that never exist in the new nation. They, in fact, wanted to add two additional amendments to the Declaration of Rights in the Constitution, but never succeeded. They believed that to protect the freedom of the people the nation should be "free from monopolies in commerce" (what are now giant corporations including the big international banks and investment firms on Wall Street) and "free of armed forces permanent, "or standing armies strength. Try to imagine how the country would be today if Jefferson and Madison would have been - a country without giant predatory corporations exploiting everyone for profit and no armed forces are rampant that the world war, threatening to destroy it and make it for corporate giants to get even greater benefits.
never succeeded, by the way, and people have paid dearly ever since including the great harm caused because the government relinquished its right to control the money supply in the nation. Gave it secretly without the public knowing it, ignorant of the harm he had done. Has been even worse since the eighties, because the power of the Fed raised under a president Republican friend, and the racket run by the corporate media hid the effect. For them it is unacceptable that the Fed is degraded in public, and its giant member banks or Wall Street allies.
Things got out especially during the performance of Alan Greenspan. Surprising that there has been one to find many reasons to praise such a Fed chairman before to lead the Fed, when he was a presidential adviser, or during the period in which he directed. Only entered government service after the failure of its financial consulting firm, probably because I needed a new line of work. There he managed to become prophet in a lush central bank was almost elevated to sainthood by the business experts who thought that under the exercise were only blue skies and few clouds in sight always predicted that the sun shine again. Now Alan is retired to the more fertile horizons book contracts and conferences, which shows that if you work well for the rich and powerful that allows it, (at the expense of other people) the final reward will be worth . It is likely that the new Fed chairman has taken note and will try to continue the tradition accordingly.
But try to imagine a different kind of Fed chairman, someone who knew, have faith in and practiced the words and wisdom of another American president of some importance: Abraham Lincoln. In 1886 Lincoln said: "The money powers prey on the nation in times of peace and conspire against it in times of adversity. It is more despotic than a monarch, more insolent than autocracy and more selfish than a bureaucracy. They denounce as public enemies all who question its methods or throw light upon its crimes. I have two great enemies, the Southern Army in front of me and the bankers behind. Of the two, who is back is my biggest enemy. "
seems that Lincoln also said (although some dispute it): "I see approaching in the near future a crisis that worries me and makes me tremble for the safety of my country ... corporations have been enthroned and an era of corruption in high office, and the power of money the country will endeavor to prolong its reign by using the prejudices of the people until all wealth is concentrated in a few hands and the Republic is destroyed. "Imagine what Lincoln would say today.
What Lincoln thought of the bankers and money power in the country, seems to raise the obvious question: Did they have something to do, or were the reason for his untimely death at the hands of John Wilkes Booth? International bankers obviously hated Lincoln after he got Congress to approve the Law of the legal currency of authorizing the U.S. Treasury to issue paper money called "greenbacks" [green]. Lincoln needed this legislation after he resigned to pay bankers usurious interest rates of between 24 and 30% that required for loans needed to finance their war with the south. With the new banking law, Lincoln was able to print the millions of dollars needed, free of debt and interest. This was not, obviously, what the greedy bankers wanted as they can only take away their benefits when carrion piece of financial transactions they control. Lincoln was assassinated shortly after the end of the war, and a little later rescinded the so-called law "Greenback" [Green], adopted a new banking law, and all money returned to produce interest.
How the Federal Reserve System.
The Federal Reserve System is that Congress and the President agreed to privatize the nation's money system and relinquish the power that should have remained the exclusive right of the government. That act was so outrageous the Fed had to be deliberately structured to look like a federal government delegation to hide that reality is all-powerful banking cartel private property whose member banks (including any national) share the vast benefits of having the license should be more important than government-exclusive right to print money in any amount, control its supply and price, and delivery mode benefit immensely in exchange for a benefit, including the government itself that must pay interest on the money, which would never be necessary if you just printed. Consider what would happen if the government legalized the right to counterfeit the national currency for private gain. It is no exaggeration to say that is the biggest financial scam of all time, causing incomprehensible harm to a public that still does not know. Works as follows:
The Fed received the authority to conduct monetary policy in the nation with the power to control the supply and price of the currency. You have three ways to do it - through open market operations, the benchmark rate it charges member banks and the reserve requirement percentage of member banks assets it requires them to maintain their power and not be paid . The Governing Council is responsible for managing the reference rate and reserve requirements while the Federal Open Market Committee (FOMC, for its acronym in English) is responsible for open market operations or purchase sale of obligations explained later. Using these instruments, the Fed can influence the supply and demand for money and thus directly control short-term rate of federal funds is always fixed unless the Fed wishes to raise or lower it. Longer-term rates are controlled by the powerful institutional traders in the bond market.
The FOMC and how
The Federal Open Market Committee is really key to the whole process of money creation or contraction. Consists of 12 members - seven members of the Board of Governors of the Fed, the president of the New York Fed Bank (the most important of all) and four other 11 presidents of the Bank Reserve to serve in shifts over the year. The FOMC performs eight regularly scheduled meetings a year to assess economic conditions and decide what is comfortable or has to be strict monetary policy to boost its stated goal of sustainable economic growth and price stability.
Literally, the FOMC has the power to create money from nothing. It does so through a process of four stages: Stage
: The FOMC approved the purchase of U.S. government bonds on the open market.
Second stage: The New York Fed Bank acquires obligations to the sellers (financial markets always have an equal number of buyers and sellers).
Third stage: The Fed pays for its purchases with electronic credits to the sellers bank, in turn, credit the sellers' bank accounts. These credits are literally created out of nothing.
Fourth Stage: The banks receiving the credits can then use them as reserves to enable them to pay up to 10 times their amount (if their reserve requirement is 10%) through the magic (only banks have) of banking fractional reserve and, of course, charge interest on the total. What a deal! and everything is legal. Imagine how rich we might all be if we could do the same as private individuals. We borrowed one million to the Fed, as if by magic, we multiply by 10, and charge interest on the total, with the exception of 10% that we must keep in reserve. It's the magic of the creation of fractional reserve money and explains how powerful an economic stimulus when the Fed wants to enhance economic growth.
When the Fed wishes to contract the economy by reducing the money supply simply reverses the above process. Instead of buying bonds, sell them so the money comes from the buyers bank accounts instead of joining them. Then, bank loans have to be reduced 10 times if the reserve requirement is 10%.
How the Fed harms the public interest
The Federal Reserve System exists only to serve its owners and its member banks and in doing so is hostile to the public interest. That's because it is a banking cartel with the power to restrict competition by higher profits at our expense. Out of our pockets to theirs, and the public loses in four ways: First
: Through the invisible tax of inflation that results from the dilution of purchasing power caused by the entrance to the newly created money system, which which reduces the value of the dollars that are already present. The Greenspan Fed was especially expansive, never was blamed for its excess and was able to pass on the serious problem it created a future Fed chairman and society to face it. The man who now extol as a monetary magician began sensibly. Since 1982, before he arrived in 1987, until 1992, the money supply increased by an average of 8% per year. But from 1992 to 2002, printing presses worked overtime in sync with the deregulation and growth of global markets, expanding the currency by more than 12% per year. It became even more extreme after the 11-S and since 2002 grew at a rate of 15%. Now has more than doubled in less than a decade. It seems that the new Fed chairman has taken note and begun to slow the pace of monetary expansion and continues to increase the federal funds rate to whatever level you have in mind.
Currency traders also appear to have taken note of the overall expansion rate of the money supply. With the exception of a break in 2005, it is likely that the weakness of the dollar since 2002 is the result of excessive wasteful spending created by the Bush administration to fund its endless wars and reckless tax cuts for the rich. The problem is further complicated because from 1964 to the present debt service has grown from 9 to 16.5% of the federal budget and rising, and the current deficit has gone from a surplus of 1% to almost 7% deficit, federal debt has grown by 40% just since 2001 and has been funded in large part by "the kindness of strangers" that may be losing the nerves. Moreover, since March 2006, the Fed stopped publishing M-3 the sum of total dollars in circulation. Without such transparency, now big buyers of U.S. Treasury obligations have to calculate the value of the dollar based on speculation and uncertainty rather than data safe - not something that inspires confidence in financial markets that function best in an atmosphere of openness and clarity.
Second: The public also loses because the banking cartel can practice usury - from his power over a flexible currency to artificially raise or lower rates at whatever level they choose what many small lenders can not do in a truly free and open market. Moreover, the domination of the market by the cartel forces most borrowers (especially smaller ones who are least able to issue their own debt instruments) to ask for loans that can then be done using what should be the money people, made available at the lowest cost possible for many small lenders heavily regulated by the government, which would compete in search of clients.
Third, through taxation, we the public have to pay to cover the interests of the vast national debt (now over $ 8.4 trillion) accumulated from the money the Fed printed and loaned to the government. As noted earlier, now totals an annualized amount exceeding two-thirds of a trillion dollars and increasing daily. Has enriched bankers, impoverished the ordinary people and the public still does not know that he is being fleeced big. Fourth
: Compounding the above abuse, the cartel can make the public bail out the system more taxpayer dollars. This happens every Once one of the banks too big to be allowed to fail need financial help to survive. The same applies to big corporations like Chrysler or Lockheed, large investment firms or hedge funds like Long-Term Capital Management or even countries like Mexico. Also applies when you close a single bank and you have to compensate depositors or, more seriously, after a systemic financial crisis like the one that wiped out many savings and loan banks in the eighties. Be a single bank or many dozens at the same time, public tax dollars are used to save the system or just to pay the bill to reimburse depositors insured against losses insurance for government protection to a certain amount per account.
How Adam Smith would have reacted to the Federal Reserve System?
This concentration of wealth and power of the banking cartel is the opposite of what Adam Smith, the ideological godfather of free market capitalism, advocated in his writings, including his seminal work "The Wealth of Nations." Smith wrote about an "invisible hand" that he said worked best in a free market with many local small businesses competing against each other. Strongly opposed the concentrated mercantilism of his time (whatever it was) that currently would the equivalent of our giant corporations and the banking cartel with the power to restrict competition, maintain higher prices than would have been possible otherwise, and as a result, earn higher profits at the expense of the public.
The type of banking cartel that exists today is precisely what Smith would have condemned. But there is a central bank is not bad in itself if the bank is government owned, controlled and operated according to the public good. Only a problem when through subterfuge the bank down so it looks as if it were owned and operated by him, when in fact, works on the basis of private interest in our case and in most others. And in USA, to operate the rigging, the system is managed by a governing body appointed mostly by the government, which acts as a pimp for members of the greedy private banking cartel that was the first to want to exist and that a corrupt Congress did put it to them. To work, the cartel needs the cover that gets as a result of its partnership with the government, but it hurts the public interest because this structure to serve his own private gain.
And so we come to the crux of the problem: the Congress elected to serve the people, betrayed him instead of fulfilling his duty to create a powerful banking cartel and grant the authority to practice fractional reserve banking with the power to get free money by creating it from scratch. Then allowed its members a near-monopoly right to set interest rates charged to borrowers want. The whole process amounts to a legally sanctioned heist by the powerful banks operating in cahoots with the government for their own benefits. Is also part of a broader process organized by the government to transfer wealth from the people to the pockets of large corporations and the wealthy, while those affected do not know they even occur.
Reserve System Federal also harms the public in another way:
The Fed harms the public good in another important way, and again most people do not have the slightest idea. The Federal Reserve System was supposedly established to stabilize the economy, smooth over the business cycle, maintain a healthy rate of sustainable growth while maintaining stability of prices and benefits everyone. Have you done your job? Since its inception in 1913, we had the superstars of 1921 and the most important and remembered in 1929. It was followed by the Great Depression that lasted until the beginning of World War II, which according to the noted conservative economist Milton Friedman was caused and exacerbated because the Federal Reserve decided surprisingly reducing money supply in times of economic contraction instead of increasing it. We then had recessions in 1953, 1957, 1969, 1975, 1981, 1990 and 2001. We also had inflation beginning in the sixties. This was quite severe through much of the seventies and early eighties. And we had a major banking crisis in the eighties in which more banks and bankrupt savings and loans than ever before in our history. It happened after the financial market deregulation, banks were permitted to pursue their own interests without supervision governmental control his inclination to take risks that would prevent excessive or try to get away with deliberate fraud.
Along with economic stability the Fed never achieved, also has boosted consumer debt, budget deficits and record trade, a high number of personal bankruptcies and rising mortgage crimes, a growing interest on debt national accounts for a large and growing federal budget, the loss of our manufacturing base and jobs with high wages because they are exported to low wage countries, an economy in which services now account for about 80% of all businesses that pay the most poorly, with less skilled jobs with little or no benefits, and an increasing gap in income and wealth that is hurting people on low or medium proceeds to benefit the few rich and wealthy, and a government that is driving this situation.
Everything is summarized in one conclusion: The Fed did not comply, above all, the essential task for which it was set to begin. But much worse, if we understand the true motives of a cartel. Is not to serve the public interest. You abuse it, because that increase profits. You can do this with the concentration of power, legally sanctioned, and a friendly government in league with their partners or facilitators. It comes with it when you make the most splendid of theft with this rigging hidden from public view.
A necessary solution to a huge problem.
is clear from the information submitted to the Federal Reserve System was established through stealth and deceit by a handful of corrupt politicians to serve their powerful allies in the banking and Wall Street. They did it to defraud the public and if it has not had the slightest idea what was happening, and how damaging it was for their welfare and interest. Those in Congress and President Wilson (A man trained in law, former practicing attorney, former esteemed academic and president of Princeton University) either knew or should have known that the law that he and they approved establishing the Fed was in direct violation of the Constitution they had sworn to defend . They did not, and violated the law, and the public paid dearly for his crime since then until today.
So, what recourse is left, and it is possible to mobilize people to follow up? There is only one sensible and just solution to undo the damage has been done so many for so long: to abolish the Federal Reserve System and restore the power it currently has a Federal Government working for the public good. Retrieve the powerful banking cartel working against it and not return to never let slip back into their hands. It is the only way. The great German poet and playwright Bertolt Brecht would have agreed when he said "easier to rob a bank setting rounds."
Releasing the power of these powerful "money changers" would bring enormous benefits for all. Establish a prudent policy of money creation that would minimize our most unfair tax - inflation which is caused by private bankers in pursuit of profit that manipulate the money supply in the nation to increase them. Estabilizaría la economía y suavizaría los extremos en el ciclo de la coyuntura agudizados por el cartel que trabaja para su propio beneficio y contra el nuestro. Reduciría el coste del dinero para los prestatarios porque terminaría con el poder monopolista que tiene actualmente el cartel de establecer las tasas que prefiere, abriendo el mercado a más competencia. Reduciría la creciente y opresora deuda nacional al ser por fin liberada del aumento del suministro de dinero requerido para pagarla. Reduciría la carga tributaria para el público ya que se necesitarían menos ingresos para el servicio de la deuda. Sería un paso trascendental hacia la reducción del poder abrumador de todos los gigantes corporativos depredadores que nos exploited in order to grow and prosper, and hopefully end up deleting it. It could even serve as deterrent to wars that only fought for wealth and power - never for glory or to make the world safe for democracy or other false motives. Without a powerful banking cartel and other industry giants that live off human misery they create, there would be less need for any war. Try to imagine such a world and a government that works for the public welfare instead of harming it as it does now to serve the capital. That world is possible, and responsible people have to work for it, because we now have has failed and must be changed before it is too later. A world view created by the interests of capital and our government supports it. The disturbing
, corrupted world of neoliberal capitalism "free market" controlled by giant corporations, which benefits only the privileged few and causes so much misery and despair, a despotic world that can not last, nor should we allow that last much longer , in which endless wars for power and profits, in which people are a commodity used as needed and discarded like trash when it is not, without concern for preserving an ecology able to sustain us, not what will continue much longer because we're destroying, and ourselves for profit; in which basic human needs do not matter under an economic model in which private benefit is only worth, in which democracy is incompatible with predatory capitalism, in which no should want to live or have to do, where we must change or die. In the language of capital, is the bottom line. Only a mass movement of committed people can change the world. Must end or we will end all.
Unless we can move from our failed economic model to a better alternative will end when the day comes one way or another. But it could be an outcome that anyone could wish - their self-destruction that takes everything with him, either by nuclear holocaust or an environment so inhospitable that does not allow us to live in it. Our only chance is to work for change while there is time.
A vision of a different world., History proves a better world is possible when committed people work hard enough for it. Thus ended slavery, the workers won the right to organize and collective bargaining, women achieved the same voting rights as men control over their own bodies, and more rights and status in the labor force, blacks and other minorities won important civil rights, and state policies important social legislation even though it was only for fear of what might happen if they did.
Thomas Jefferson explained that "the price of freedom is eternal vigilance." It's the same price to pay to maintain our social gains achieved with such difficulty. In the past generation those gains have eroded while not paying attention and only mass action can rescue the people. The goal should be a humane world of participation in which people's lives improve because we all work together to achieve: a world of peace, not endless wars to benefit the rich and powerful at our expense, in which all needs essential human are met because governments work for the common good to secure it, with real participatory democracy where the public and elected officials work together to keep it strong and vibrant, no oppressive corporate giants or banking cartels because the law does not allow them; in which nutrition and ecological preservation is a central concern, in which air, water, pure soil and adequate food and safe, a world much simpler, with a more local than at present, in which notions such as globalization or even part of the vocabulary, a world based on social equity and justice for all, governments, maintenance enforcement and the courts working to ensure that it remains so, a world where all want to live and hopefully some day we can, a world we want to bequeath to future generations a world that we can not fail to achieve because the alternative may be nothing.
may find ourselves at a crucial moment where our fate is at stake. Either we work together for a better, sustainable or likely we will become the first species to be self-destructs. If it happens, we'll probably take most of the others with us and not leave much to the few that remain. We no longer have the luxury to discuss the kind of world we need to survive. The giant banks and corporations not provide us, nor will a hostile government allied with them. Depends on us that we will achieve or is likely to succumb if we fail. It would be a good start if you drive them from our church to the "money changers" from the Federal Reserve and with them the giant corporations. A better world is possible if we remember and live according to Antonio Gramsci's inspirational words about "the optimism of the will." With your help, organized people can find a way to beat organized money.
Image: Pastor Jose Cabrera
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