January 13, 2013_August 30 2015
“Silence in the face of evil is itself evil. God will not hold us guiltless. Not to speak is to speak. Not to act is to act”. Dietrich Bonhoeffer
“Give me control of a nation’s money and I care not who makes its laws.”– Mayer Amschel Bauer Rothschild
“A great industrial nation is controlled by its system of credit. Our system of credit is concentrated in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the world– no longer a government of free opinion, no longer a government by conviction and vote of the majority, but a government by the opinion and duress of small groups of dominant men.” — President Woodrow Wilson
“I believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a moneyed aristocracy that has set the government at defiance. The issuing power (of money) should be taken away from the banks and restored to the people to whom it properly belongs.” — Thomas Jefferson, U.S. President.
The FED’s as a manager is charted to control inflation and maintain full employment. A criminal conspiracy is an agreement between two or more persons to do an unlawful act or to do a lawful act in an unlawful way. The Fed had an original charter to maintain full employment and control inflation. A good job would be one where one accomplished its original objectives. The 100 year record shows that they have not maintained full employment which is now at 24% unemployment – that approaches the 30s depressions level maximum of 28%. Further, the dollar has lost 98% of its value since 1913. Thus, these facts prove that the FED is a lousy manager.
A conspiracy is harder to prove but in this case, the players were blatant and open in their cooperation and creation of the burglar’s tools to steal citizens’ assets. The involvement of the banks, the FED and Congress in the creation of the Dodd Frank law was blatant and forced on the people without discussion. It specifies that the government must do whatever is required to keep the big “too big to fail” banks solvent. These banks own the FED and constitute the banking cartel. To me this is a blatant conspiracy comparable to the original FED Act in 1913. These same players further expanded the strategies to the G20 nations to steal depositor’s assets throughout the world by means of the financial “Bail Ins”. They used the 2010 G20 Strategic Plan to change the name of “Too Big to Fail” to Globally Systemically Important Financial Institution (G-SIFI) and to describe the “Bail Ins” as the mechanism to enforce the sustenance of the “Too Big to Fail” financial institutions. This plan was tested in Cyprus, Spain, UK and the US (MF global). It works, is set to go and can be executed at any time. It just takes a bureaucrat, unelected and appointed in the G20 to say that the institution is “marginal” and in danger of failing. The “King has no clothes” even if the press and the politicians say that he does.
Is the FED a Criminal Enterprise or Just a Lousy Manager? – Background
A criminal conspiracy is an agreement between two or more persons to do an unlawful act or to do a lawful act in an unlawful way. The Fed had an original charter to maintain full employment and control inflation. A good job would be one where one accomplished its original objectives.
The 100 year record shows that they have not maintained full employment which is now at 24% unemployment – that approaches the 30s depressions level maximum of 28%. Further, the dollar has lost 98% of its value since 1913. Thus, these facts prove that the FED is a lousy manager.
A conspiracy is harder to prove but in this case, the players were blatant and open in their cooperation and creation of the burglar’s tools to steal citizens’ assets. The involvement of the banks, the FED and Congress in the creation of the Dodd Frank law was blatant and forced on the people without discussion. It specifies that the government must do whatever is required to keep the big “too big to fail” banks solvent. These banks own the FED and constitute the banking cartel. To me this is a blatant conspiracy comparable to the original introduction and passage of the FED Act in 1913. These same players further expanded the strategies to the G20 nations to steal depositor’s assets throughout the world by means of the financial “Bail Ins”. They used the 2010 G20 Strategic Plan to change the name of “Too Big to Fail” to Globally Systemically Important Financial Institution (G-SIFI) and to describe the “Bail Ins” as the mechanism to enforce the sustenance of the “Too Big to Fail” financial institutions. This plan was tested in Cyprus, Spain, UK and the US (MF global). It works, is set to go and can be executed at any time. It just takes a bureaucrat, unelected and appointed in the G20 to say that the institution is “marginal” and in danger of failing. The “King has no clothes” even if the press and the politicians say that he does
Voltaire had a way of clarifying complex things. He once said, “If you are to talk with me, first define the things you are talking about”. In that light, I will attempt to first define a criminal enterprise as used in the title and other terms used in this short article. Then, I will examine the record to see if there is an answer to the question posed in the title of this article. For those that want a deep understanding of this topic, I refer them to Ed Griffin’s book, The Creature from Jekyll Island, that thoroughly documents the conspiracy surrounding the FED, its origin, the men who created it, how it works and why it was created. It is quite a mystery story that sickens one once the reader finds out how much the American citizen has been used and exploited by this organization over a period of 100 years. Let us now get into the details.[the_ad id=”843″]
First, let us define a criminal conspiracy in order to determine whether the FED fits that categorization. A criminal conspiracy is:
“- – – a partnership in crime — is defined as “an agreement between two or more persons to do an unlawful act or to do a lawful act in an unlawful way or by unlawful means.”
If one examines the FED for this kind of conduct, one soon finds that the following cartoon is relevant. They have become such a force that it is difficult to find accurate information on a “private” corporation that does not want to disclose their practices.
The most accurate description that I have found of the FED and its policies and actions is in Ed Griffin’s book. He describes the conspiracy by defining the bankers and Congressmen that were involved, their actions, their methods of trying to “legalize” what I perceive is the “draining of the Treasury”.
By making their actions a legal action, even though they were not in the interest of the people but rather the Congressmen and the bankers involved, it just made the conspiratorial action a masterstroke. What was the “act”? It was to have the FED create money when the Congress needed it and in whatever amounts they needed. In return, the critical Congressmen got whatever funds they needed to convince their constituents to reelect them and in addition, whatever funds needed for re-election campaigns in the form of “contributions” from the bankers. This is a form of bribery but now this procedure was “legalized” by the Federal Reserve Act of 1913. Technically then, these actions are not criminal and thus the FED is not a criminal conspiracy. We will revisit this later in this article because “Power corrupts” and the FED has been in power for 100 years. Remember, a “criminal conspiracy” is performing a lawful act in an unlawful way or performing an unlawful act.
FED Charter and its Record
The FED was given only two objectives to be met by the Congress in 1913 because the Congress and the Nation were sold the concept that the FED could do these things. They were:
• Maintain full employment
• Control inflation
The record now shows that they were “Lousy Managers” and failed miserably on meeting both objectives. Specifically, there have been two Depressions, 1933 where unemployment rate hit 28%; and the 2008 depression that we are still in where the unemployment rate is now approaching 24%. The current government statistics are not reporting this latter number but my independent research as well as those of “shadowstats” show that number for unemployment. Obviously, the FED has not done its job.
Now, let us look at inflation. Prior to 1913, the inflation rate tor for this nation for 100 years was less than 3% because we were on a gold standard and that system is self-adjusting. The FED’s record is abysmal because we have lost about 98% of the value of the dollar in 100 years as the following record shows. Also, note that the loss came when we entered the FED fiat currency era.
Now, one has to ask oneself, if you had a private contractor that did not do the job given it, what should you do? Normally, one would fire the contractor, do the job oneself or hire another contractor. The FED is a private contractor. In the last 100 years, that FED contractor has gotten in the position of de-facto controlling the Congress. Proof is that Ron Paul tried for 30 years to get them audited. He was never successful. If he had been successful, and the true nature of loans made by the FED in the name of the American people was disclosed, the FED would have been fired.
The Federal Reserve System (FED)
The Federal Reserve is a cabal of bankers acting as a Central Bank for the U.S. It is a private central bank system that creates money. The system institutionalizes a form of banking called fractional reserve banking and now fiat banking.
Historically, people deposited gold with banks and got a receipt for the gold that was left in storage. Statistically, only about 7% returned to get their gold. The depositors wanted it to keep their gold deposited with banks for safety. Bankers, figured out that they could create “loan receipts” backed by the other 93% gold that was deposited and get interest for lending this other 93% since the original depositors were not demanding their gold back. Historically, to be conservative, they settled on 10% reserves in gold. Thus, a deposit of $1 million in gold enabled them to lend out $10 million in loans. This process is called “hypothecation” of funds. It uses other people’s assets as your own and you make money off those assets. Individuals that do this break laws. Bankers do this as a way of business. Fractional reserve banking is the term used for this banking process and historically a ratio of 10:1 was used and subsequently institutionalized and put into New York state law, followed by the other states, as the “prudent man” rule for lending.
Over 90% of the money supply is created out of nothing when it is given to borrowers as loans. These loans must be repaid to the banks with interest. The banks make money on revenue from this interest on money created out of nothing. As an aside, this also extends to treasury bonds. John F Kennedy (JFK) was trying to stop this process by creating treasury bonds from the treasury with no interest paid to the Federal Reserve. Further, he had started printing money as treasury notes rather than Federal Reserve notes. However, he was killed within seven months of this executive order in 1963. Lyndon Johnson rescinded the executive order the first day on the job.
Structure of the Federal Reserve System (FED)
The FED has in my mind a deliberately confusing mix of public and private interest, boards and committees, centralized in Washington DC. The structure of the Fed is as follows. The president appoints the Federal Reserve Board. That is where “public interest” begins and ends. The president also chooses a select set of governance. The 12 regional banks in the Fed represent Wall Street bank interests. The New York Fed is the most powerful because it directly represents the US banks such as J.P. Morgan, Citibank and Goldman Sachs, who appoint the leadership of the New York Fed. The net result of this is that the New York Fed has major public power with no public accountability. Specifically:
• The Fed does not answer to Congress;
• The Fed does not answer to the president;
• The Fed does not answer to the public;
• In addition, the government cannot tell the Fed what to do;
• The FED is a private corporation owned by other banks. It answers to those private owners.
• My research has shown that European banks and private families along with a few American families such as the Rockefellers have controlling interests in the 12 FED Reserve banks. I document these findings in my book, “Who’s Next?”
Myths of the Federal Reserve System (FED)
Ed Griffin’s book describes how the FED was planned by a set of bankers and Congressmen in 1910 at a secret meeting at Jekyll Island, SC. It was at a private club owned by millionaires from New York, including William Rockefeller, J.P. Morgan and associates. The conspirators over the years have been revealed as:
• Senator Nelson Aldrich, father in law to John D. Rockefeller, Jr. and Chairman of the Senate finance committee;
• A. Piatt Andrew, Assistant Secretary of the Treasury;
• Henry P. Davison, Senior partner at J.P. Morgan;
• Frank Vanderlip, President of the National City Bank of New York;
• Benjamin Strong, President of Bankers Trust and close associate of J.P. Morgan;
• Paul Warburg, heir of the Warburg banking family fortune in Germany and son-in-law of Solomon Loeb, one of the founders of Kuhn, Loeb and Company and an attendee at the Jekyll Island Meeting.
Frank Vanderlip, wrote in the Saturday Evening Post of February 9, 1935, that
“I was as secretive – indeed, as furtive – as any conspirator . . . I do not feel it is any exaggeration to speak of our secret expedition as the occasion of the actual conception of what eventually became the Federal Reserve System.”
Paul Warburg was the mastermind of the Federal Reserve Act of 1913 and he got his direction from Alfred Rothschild of London. Paul Warburg financed Hitler with the help of Brown Brothers Harriman partner Prescott Bush whose son, Prescott Sheldon Bush was a Senator from Connecticut (1952-1963) and father of George H.W. Bush (41st president). Colonel Ely Garrison, a friend of both President Teddy Roosevelt and President Woodrow Wilson wrote in his book, Roosevelt, Wilson and the Federal Reserve,
“Paul Warburg was the man who got the Federal Reserve Act together after the Aldrich Plan aroused such nationwide resentment and opposition. The mastermind of both plans was Baron Alfred Rothschild of London.”
Practices of the Federal Reserve
This set of conspirators devised a plan for a central banking system for America that was owned by the banks. By owning the bank, they guaranteed that they controlled the money supply and everything that America did after 1913. This system was a private banking cartel that would control the issuance of the national currency. After the meeting, the details coalesced into a formal law signed by President Wilson on December 23, 2013. It was called the Federal Reserve Act.
The Fed over the years created myths to divert from the above facts. Specifically, their literature and explanations say that the FED is a government institution. The source of this is the Fed’s website and misleading statements made by them. The facts are that the Fed is a corporation with a board of governors. It has an open market committee and 12 regional banks as their owners that are private corporations. A 1928 Supreme Court ruling held that,
“Instrumentalities like national banks and Federal Reserve banks, which are private interests, are not departments of the government. They are private corporations in which the government has an interest.”
In 2008, Mayor Bloomberg used the Freedom of Information Act to force the FED to disclose secret bailouts. The FED argued that they were not a government agency but a private corporation whose shares were held by the 12 member private corporate banks and other banks making those banks the “owners of the FED”.
The FED’s own descriptions mislead the public stating for instance, “The Federal Reserve system fulfills its public mission as an independent entity within the government.” The truth is that the FED’s decisions are not subject to any government interference. Specifically according to the Fed,
“Its monetary policy decisions do not have to be approved by the president or anyone else in the executive or legislative branches of government: it does not receive funding appropriated by the Congress: and the terms of the members of the board of governments spanned multiple presidents and congressional terms.”
Alan Greenspan says further that,
“The Federal Reserve is an independent agency and that means there is no other agency of government that can overrule actions we take.”
From this, it follows that the FED can loan to their own “owners”, the banks and they can make these loans payable by the American citizens as public debt. Further, no one can stop them. This has been their practice over the years.
The Fed is a fascist cabal of banks. Ron Paul spent 30 years trying to get the cabal audited but failed. The Congress demonstrated that they were more interested in protecting the Federal Reserve than protecting the American people.
The feds self-mythical promoted image of a public and not a private profit-making institution is a fraud. In fact, the Fed is a profit making cabal of banks that has a 6% annual dividend payment. In addition, the banks get a major indirect benefit for “controlling the money making source of the American people”. The real benefit is bailouts for bad debt that keeps the banks from failing. When the banks make bad loans that cannot be repaid by the recipient of the loans, the Fed bails them out. This fascist collusive white-collar crime is not being addressed by anyone in the legislature or the regulatory arms of government. It is also fascism and not capitalism. Insightful but not comforting is the fact that Graham Dodd Law put all financial regulatory arms under the FED. The cops now report to the chief “thief”.
How Does the FED Work?
Here is how it works. First, the banks lend money in the trillions of dollars to corporations and nations. Most of the nations are European, Latin American and socialistic. They are running out of money to keep socialism going and the politicians in power. The money goes to sustain and maintain these socialistic systems delaying their eventual failure. Mexico, Spain and Greece come to mind as typical and obvious examples. After these loans become nonperforming and non-payable, the banks go to Congress who are either their partners or employers but certainly complicit. They tell Congress that we lost $20 trillion so we need some money. The Congress then goes out and bails out the Corporation (GM, AIG) or nation (Mexico, Greece). These loans are made for the most part in secret but certainly not with public exposure because they will be made with new money created by the Fed, which will be added to the public debt. The banks are paid back with interest on these “bad loans” and the process goes on because the new loans will also not be paid back when they fail.
Meanwhile the Fed and its banker owners get the interest even though that they know that the loans would default. They also know that when the loan defaults they will get the Congress to bail them out of this bad loan. This win-win scenario says if I win and the loan is paid back, I make money and if I lose and the loan is not paid back the Fed will bail me out with full interest and I make money. This is fascism working.
How much of this is taking place? The answer came out in the 2008 crisis. Congress authorized $700 billion for the TARP program but subsequently it turned out that $16 trillion was lent, primarily to European banks and countries, using the Fed’s own emergency loan lenders programs. See what the TARP manager says in my article, “Confessions of a Quantitative Easer”, here. The GAO in 2011 concluded that the program was managed by the banks that sat on the board of the New York Fed. These same banks were the recipients of the $16 trillion in loans. This is collusive theft carried out by a conspiracy of bankers, the FED and the Congress. William K Black in a recent book states, “The best way to rob a bank is the own one.”
He is right. Consider that the FED was authorized by our Congress to spend $700 Billion and they spent $16 trillion, which was placed on the public debt – off the books of course. This is way beyond the Federal Reserve Act of 1913 and is “outside the law”. It was done within the cognition of the FED and no one else as proved by the lawsuit that was required to get them to divulge the partial truth. This appears to me to be an act of an “outlaw” and thus is a criminal Act. As such, the FED is involved in a criminal conspiracy. This leads me to conclude that the FED is both a “Lousy Manager” and a “Criminal Conspirator”.
When one extends William K Black quotation to a nation, one could say, “The best way to rob a nation is to own its central bank.” Rothschild was right and our FED is the instrument used in controlling the nation across both Republican and Democratic administrations.
In conclusion, the FED is both outside the law and became a criminal enterprise in recent years. Further, it has done a lousy job of fighting inflation and maintaining full employment. Only a full audit of the FED will prove my first allegation but the second is obvious for all to see. This raises the question, “Why hasn’t the FED been audited?” The answer lies in the fact that no conspirator that commits fraud likes the light of an audit that would prove his or her guilt. The fascists in power in banking and government will not let the audit happen, because they may end up in jail.
What should Americans do? A precedent has been established in Iceland. When it became obvious to the Icelandic citizens that this type of banking theft of their Treasury was going on, they acted. They got a new president who promptly investigated the banks with Grand Juries. This ended with the banks going bankrupt; the central bank was disbanded; and, many bankers and many legislators went to jail with some still on the “run”. The nation left the EU and the Euro and put in place their own currency. Further, they discovered that house loans were also fraudulent. Therefore, they forgave all residential debt. The net result is that Iceland is out of the EU; runs on their own currency issued by their own Treasury; bankers and legislators are in jail; homeowners are debt free and the nation is flourishing. It took about 2 years to do all this. I believe that the US could do the same thing but will not because the elite in power in government and banking want to stay in power. They will do anything, change anything, and say anything to remain in power and not lose their jobs and pensions. I note that these characteristics are the markers of fascism not democracy.
Investment in this Political and Economic Environment
It is apparent that the “band” is still playing while the Titanic is sinking. This nation and much of the free world is in a depression; however, the FED is providing delusion of growth with its QE programs. Specifically, the $85 billion / month from the FED has now been reduced to $75 billion / month, which is not much. The $75 billion / month goes to the FED’s owners, the banks. The FED creates the money, buys the banks “toxic waste” mortgages at list; the banks were told to invest ½ back at the FED for interest paying deposits and the other ½ is to be invested into the Stock Market. This is the “band” playing. Expect the market to continue to rise until the QE truly ceases. Then, after a few months, it will drop dramatically. The market is at 16K now with 24% unemployment, earnings down, interest rates at historical lows, GDP stagnant, taxes up, 49 million people receiving food stamps, inflation rising and investment virtually zero. The result is that the banks are realizing outstanding growth in earnings with this “free money” and the market will continue to rise while the economy and people suffer.
Given the above, expect the market to continue to rise until the interest rate rises. Historically, the interest rates should be about 5.9% not sub 3.0 %. When the interest rate rise to 5.9%, the interest on $12 trillion debt will rise by another $348 billion and the music will stop. Note that the 10-year bond rates have doubled in the last year. They are now about 3.0%.
As a result, a reasonable strategy would be to continue to buy hard assets as rare metals, property and land and continue to invest short term and enjoy the ride up in this artificial market created by the FED.
Cultural Battle – Individualism vs. Collectivism
The political situation affects the economic investment environment. Currently, the nation is in a fight between individualism and collectivism. Entrepreneurship with your own business is a way to “stay out of the line of fire”. The collectivists seem to be winning at this point with this President but the game is not over. We have a President who is:
• Not being held accountable for his unconstitutional policies that are designed to limit choice, and place more power in the hands of government.
• Violating Article II, Section 3 of the Constitution by picking and choosing what laws to enforce rather than taking “care that the laws be carefully executed”.
• Violating Article I, Section 1, of the Constitution that gives all legislative powers to the Congress. The President has been issuing Executive Orders to legislate from the Executive branch.
• Scolding the House of Representatives for challenging his statist policies and taking actions, “with or without Congress”.
• Arming drug cartels in Mexico and terrorists in the Middle East who are sworn enemies of the United States. See my articles – “An Analysis of a Scandal: Fast and Furious / Benghazi – Gun Running – A Question of Treason” here; my Post on 11/13/13, “Benghazi Cover-up: A Judicial Watch Update”, on my education site, jpfinancialeducation.com; and “An Analysis of 4 Scandals – IRS, Benghazi, Sebelius, and Associated Press”, here.
• Supporting Bail Ins for the Banks. See my recent article, “Insolvent Banks and Government are Likely to Confiscate Wealth and Independence”, here.
This is bigger than Republican vs. Democrat. It is a fundamental battle between collectivism and individualism. The leadership of both parties want collectivism because it gives the incumbents more power. Voters sense this and because they do, they are moving rapidly toward being grouped as “independents”. The individual desires less government but has found himself in a bad position of not being able to find work and dependent upon the government’s support.
Yes, the United States is different because we were founded as an exception to the rule of state collectivism. However, will this spirit survive?
In America today:
• An individual could own property, which is equated with freedom. Now through farm subsidies and regulations, owners must act in the way the government directs.
• An individual could choose his or her own faith but now the state religion of “progressivism” is in place. This “state religion” targets individuals with political correctness to silence their fundamental religious beliefs on birth control and homosexuality, and Christianity.
Gradually, the growing welfare system of redistribution of wealth has created an image that it is a stigma to be successful. Wealth is being stolen by the government, redistributed to those who are not producers and the takers cheer when the producers suffer under the heavy weight of taxation.
Again, an entrepreneurship of running your own business appears to be the best way to survive what is continuing to be “very rough seas ahead”.