We’ve all heard it before . December 21, 2012 , the so called “end of the world” , the end of the mayan long count calendar, the start of a new age.
Of course, this is all rumor, innuendo , hear say, and superstition. As far as one can tel
l, at this point, no impending global natural disaster is coming.However, new information has come to light, something Buried in the history books, and smothered by December 21, 2012 end of the world fluff stories.What we have discovered, quite simply, is the 100 year anniversary of the Federal Reserve, the 100 year charter reported to expire, coincides with December 21, 2012 . The supposed, Mayan end date.
The United States Federal Reserve, was chartered on December 23, 1912 . Signed into law exactly one year later, by President Woodrow Wilson, on December 23, 1913.
The Federal Reserve, Will reach its 100 year maturity , indeed, 100 years to the day of passage in the Congress, on Sunday, December 23, 2012.
However, the last day of banking business will be on Friday, December 21, 2012. The so-called “end of the world”.
Therefore, we have an ironic match. The projected “end of the world” date of December 21, 2012 , the mayan calendar , matches with the last day of Business for the Federal Reserve, before its 100 year anniversary, and before its charter supposedly expires.
It would seem, instead of a global natural disaster, we might be seeing the stage set for a global FINANCIAL disaster. One which was planned. One which was BURIED , under a heap of end of the mayan pyramid new age mumbo jumbo.
Either its a planned demise of the Federal Reserve , or we should wish them a “happy 100th birthday” on the day of “the end of the world”.
Be prepared, just in case. It is too big of a coincidence to overlook.
1912: Woodrow Wilson as Financial Reformer
Though not personally knowledgeable about banking and financial issues, Woodrow Wilson solicited expert advice from Virginia Representative Carter Glass, soon to become the chairman of the House Committee on Banking and Finance, and from the Committee’s expert advisor, H. Parker Willis, formerly a professor of economics at Washington and Lee University. Throughout most of 1912, Glass and Willis labored over a central bank proposal, and by December 1912, they presented Wilson with what would become, with some modifications, the Federal Reserve Act. (make sure to note the date of December 23, 1912 . The date the law was signed)
1913: The Federal Reserve System is Born
From December 1912 to December 1913, the Glass-Willis proposal was hotly debated, molded and reshaped. By December 23, 1913, (exactly one year after passage in the congress) when President Woodrow Wilson signed the Federal Reserve Act into law, it stood as a classic example of compromise—a decentralized central bank that balanced the competing interests of private banks and populist sentiment.
Top 10 Reasons to End the Federal Reserve
[Click here to see a PDF version of this report.]
1. The Federal Reserve Has Far Too Much Power to Control Our Economy
Federal Reserve Chairman Ben Bernanke has the power to dramatically impact our economy at a drop of the hat. The central bank completely controls and determines the money supply. It is permitted to create as much money as it wants out of thin air with no restrictions. This is the antithetical to the principles that America was founded on. Our Founding Fathers would be outraged that one centralized institution has unchecked and unprecedented power to control the economy and thus our lives.
2. The Federal Reserve Has Significantly Devalued Our Currency
The laws of supply and demand apply to money. The more dollars we have in the circulation, the less the currency is worth. Our money supply has rapidly increased over the past century due to the Federal Reserve printing massive amounts of money like there is no tomorrow. This is what will almost inevitably happen when a quasi-governmental entity can simply print more money to its heart’s content. Since the Federal Reserve came into existence in 1913, the dollar has lost over 95 percent of its value. Today’s dollar is worth less than a nickel compared to the pre-1913 dollar.
3. The Federal Reserve Hurts the Poor and Middle Class the Most
Our hard-earned money is essentially stolen through a hidden inflation tax. Inflation is the increase in the supply of money and credit. It is often wrongly defined as the general rise in the price of goods and services. But higher prices are actually a direct consequence of inflation since increasing the supply of money decreases the purchasing power of the dollar. Inflation hurts the poor most since they have less disposable income. Consumers with low disposable incomes will be negatively impacted by higher prices for food and clothing.
4. The Federal Reserve is Run By Unelected and Unaccountable Bureaucrats
The Board of Governors at the Federal Reserve are not directly elected by the American people. This means that those who run the Federal Reserve are unaccountable to the people. The seven members of the Board ultimately decide the price or purchasing power of our money. That kind of central planning would never exist in a true free market economy.
5. The Federal Reserve Has Made Our Economy Less Stable
The Federal Reserve has brought us endless boom-and-bust cycles. The U.S. economy was much more stable before the Federal Reserve came into existence. It bears significant responsibility for every financial crisis over the past century including the Great Depression, the stagflation of the 1970s and recent economic meltdown. The Austrian Business Cycle Theory explains why we see such wide fluctuations in the economy. The theory states that a false boom occurs when the Federal Reserve lowers interest rates below the market rate which increases the supply of money. Artificially low credit cost sends out misleading economic signals to producers. They are inclined to respond by greatly expanding their production around the same time. In retrospect, these investment decisions called malinvestments are seen as a bad allocation of resources. Malinvestments will lead to wasted capital and economic losses. The expansion of credit cannot continue permanently which means that inevitable bust will follow a false boom created by the Federal Reserve.
6. The Federal Reserve is Far Too Secretive
The central bank severely lacks transparency. Throughout its 100-year history, it has always operated under a veil of secrecy. The Federal Reserve has never been fully audited by any outside source. Our elected representatives in Congress have very little oversight over the central bank. It has continually resisted any kind of congressional oversight claiming that it would endanger its “independence.” A comprehensive audit of the Federal Reserve would not harm its so-called independence. It would only expose how the Federal Reserve has been manipulating our currency behind closed doors. And Ben Bernanke surely doesn’t want that to happen.
7. The Federal Reserve Benefits Special Interests
The policies of the Federal Reserve hurt the average American. It benefits the privileged few at the expense of the rest of us. The Federal Reserve erodes most Americans’ standard of living while enriching well-connected elites. The central bank serves big spending politicians, big bankers and their friends. Special interests receive access to money and credit before the harmful inflationary effects impact the entire economy. This is why high power lobbyists protect and defend the existence of the Federal Reserve.
8. The Federal Reserve is Unconstitutional
The Constitution makes no mention of a central bank. While there have been historical debates on the constitutionality of a central bank, I see no justification for the argument that the Federal Reserve is constitutional. The federal government only has about thirty enumerated powers delegated to it in the Constitution. The power to create a central bank is not explicitly granted to the federal government in our founding document. Due to my strict interpretation of the Constitution, I find the Federal Reserve to clearly violate the Constitution.
9. The Federal Reserve Routinely Bails Out Big Banks
The Federal Reserve acts as the lender of last resort. The Federal Reserve was ordered through a Freedom of Information Act request to release 28,000 pages of documents in March 2011. The documents exposed that one of the largest recipients of the Federal Reserve’s money was foreign banks during the 2008 economic meltdown. The top foreign banks that received money were the Brussells and Paris based Dexia SA, the Dublin based Depfa Bank Plc, the Bank of China and Arab Banking Corp., according to Campaign for Liberty.
In July 2011, due to a provision under the misguided Dodd-Frank financial overhaul law, the Government Accountability Office (GAO) conducted a one-time, watered-down audit of the Federal Reserve. The GAO investigators were not allowed to view most of the Federal Reserve’s monetary policy decisions including discount window lending, open-market operations and details on its transactions with foreign governments and banks. This first ever audit of the Federal Reserve revealed $16 trillion in secret bailouts to corporations and banks around the world in less than three years. These bailouts happened without a single vote taking place in any chamber of Congress.
10. The Federal Reserve Encourages Deficit Spending
The Federal Reserve is largely responsible for the out-of-control spending by Congress. The federal government can only obtain money through taxation, printing or borrowing money. Printing money has become the federal government’s preferred method. This is also the most destructive method since the federal government is able to simply print more money as needed to finance its drunken spending spree. It has become a never-ending cycle of spending and printing more money. Voters can put pressure on their representatives to halt politically unpopular tax hikes and lenders could stop loaning money to the U.S. government. But it’s fast and easy for the Federal Reserve to print more money at a whim.
History of the Federal Reserve
1775-1791: U.S. Currency
To finance the American Revolution, the Continental Congress printed the new nation’s first paper money. Known as “continentals,” the fiat money notes were issued in such quantity they led to inflation, which, though mild at first, rapidly accelerated as the war progressed. Eventually, people lost faith in the notes, and the phrase “Not worth a continental” came to mean “utterly worthless.”
1791-1811: First Attempt at Central Banking
At the urging of then Treasury Secretary Alexander Hamilton, Congress established the First Bank of the United States, headquartered in Philadelphia, in 1791. It was the largest corporation in the country and was dominated by big banking and money interests. Many agrarian minded Americans uncomfortable with the idea of a large and powerful bank opposed it. When the bank’s 20-year charter expired in 1811 Congress refused to renew it by one vote.
1816-1836: A Second Try Fails
By 1816, the political climate was once again inclined toward the idea of a central bank; by a narrow margin, Congress agreed to charter the Second Bank of the United States. But when Andrew Jackson, a central bank foe, was elected president in 1828, he vowed to kill it. His attack on its banker-controlled power touched a popular nerve with Americans, and when the Second Bank’s charter expired in 1836, it was not renewed.
1836-1865: The Free Banking Era
State-chartered banks and unchartered “free banks” took hold during this period, issuing their own notes, redeemable in gold or specie. Banks also began offering demand deposits to enhance commerce. In response to a rising volume of check transactions, the New York Clearinghouse Association was established in 1853 to provide a way for the city’s banks to exchange checks and settle accounts.
1863: National Banking Act
During the Civil War, the National Banking Act of 1863 was passed, providing for nationally chartered banks, whose circulating notes had to be backed by U.S. government securities. An amendment to the act required taxation on state bank notes but not national bank notes, effectively creating a uniform currency for the nation. Despite taxation on their notes, state banks continued to flourish due to the growing popularity of demand deposits, which had taken hold during the Free Banking Era.
1873-1907: Financial Panics Prevail
Although the National Banking Act of 1863 established some measure of currency stability for the growing nation, bank runs and financial panics continued to plague the economy. In 1893, a banking panic triggered the worst depression the United States had ever seen, and the economy stabilized only after the intervention of financial mogul J.P. Morgan. It was clear that the nation’s banking and financial system needed serious attention.
1907: A Very Bad Year
In 1907, a bout of speculation on Wall Street ended in failure, triggering a particularly severe banking panic. J.P. Morgan was again called upon to avert disaster. By this time, most Americans were calling for reform of the banking system, but the structure of that reform was cause for deep division among the country’s citizens. Conservatives and powerful “money trusts” in the big eastern cities were vehemently opposed by “progressives.” But there was a growing consensus among all Americans that a central banking authority was needed to ensure a healthy banking system and provide for an elastic currency.
1908-1912: The Stage is Set for Decentralized Central Bank
The Aldrich-Vreeland Act of 1908, passed as an immediate response to the panic of 1907, provided for emergency currency issue during crises. It also established the national Monetary Commission to search for a long-term solution to the nation’s banking and financial problems. Under the leadership of Senator Nelson Aldrich, the commission developed a banker-controlled plan. William Jennings Bryan and other progressives fiercely attacked the plan; they wanted a central bank under public, not banker, control. The 1912 election of Democrat Woodrow Wilson killed the Republican Aldrich plan, but the stage was set for the emergence of a decentralized central bank.
1912: Woodrow Wilson as Financial Reformer
Though not personally knowledgeable about banking and financial issues, Woodrow Wilson solicited expert advice from Virginia Representative Carter Glass, soon to become the chairman of the House Committee on Banking and Finance, and from the Committee’s expert advisor, H. Parker Willis, formerly a professor of economics at Washington and Lee University. Throughout most of 1912, Glass and Willis labored over a central bank proposal, and by December 1912, they presented Wilson with what would become, with some modifications, the Federal Reserve Act.
1913: The Federal Reserve System is Born
From December 1912 to December 1913, the Glass-Willis proposal was hotly debated, molded and reshaped. By December 23, 1913, when President Woodrow Wilson signed the Federal Reserve Act into law, it stood as a classic example of compromise—a decentralized central bank that balanced the competing interests of private banks and populist sentiment.
1914: Open for Business
Before the new central bank could begin operations, the Reserve Bank Operating Committee, comprised of Treasury Secretary William McAdoo, Secretary of Agriculture David Houston, and Comptroller of the Currency John Skelton Williams, had the arduous task of building a working institution around the bare bones of the new law. But, by November 16, 1914, the 12 cities chosen as sites for regional Reserve Banks were open for business, just as hostilities in Europe erupted into World War I.
1914-1919: Fed Policy During the War
When World War I broke out in mid-1914, U.S. banks continued to operate normally, thanks to the emergency currency issued under the Aldrich-Vreeland Act of 1908. But the greater impact in the United States came from the Reserve Banks’ ability to discount bankers acceptances. Through this mechanism, the United States aided the flow of trade goods to Europe, indirectly helping to finance the war until 1917, when the United States officially declared war on Germany and financing our own war effort became paramount.
1920s: The Beginning of Open Market Operations
Following World War I, Benjamin Strong, head of the New York Fed from 1914 to his death in 1928, recognized that gold no longer served as the central factor in controlling credit. Strong’s aggressive action to stem a recession in 1923 through a large purchase of government securities gave clear evidence of the power of open market operations to influence the availability of credit in the banking system. During the 1920s, the Fed began using open market operations as a monetary policy tool. During his tenure, Strong also elevated the stature of the Fed by promoting relations with other central banks, especially the Bank of England.
1929-1933: The Market Crash and the Great Depression
During the 1920s, Virginia Representative Carter Glass warned that stock market speculation would lead to dire consequences. In October 1929, his predictions seemed to be realized when the stock market crashed, and the nation fell into the worst depression in its history. From 1930 to 1933, nearly 10,000 banks failed, and by March 1933, newly inaugurated President Franklin Delano Roosevelt declared a bank holiday, while government officials grappled with ways to remedy the nation’s economic woes. Many people blamed the Fed for failing to stem speculative lending that led to the crash, and some also argued that inadequate understanding of monetary economics kept the Fed from pursuing policies that could have lessened the depth of the Depression.
1933: The Depression Aftermath
In reaction to the Great Depression, Congress passed the Banking Act of 1933, better known as the Glass-Steagall Act, calling for the separation of commercial and investment banking and requiring use of government securities as collateral for Federal Reserve notes. The Act also established the Federal Deposit Insurance Corporation (FDIC), placed open market operations under the Fed and required bank holding companies to be examined by the Fed, a practice that was to have profound future implications, as holding companies became a prevalent structure for banks over time. Also, as part of the massive reforms taking place, Roosevelt recalled all gold and silver certificates, effectively ending the gold and any other metallic standard.
1935: More Changes to Come
The Banking Act of 1935 called for further changes in the Fed’s structure, including the creation of the Federal Open Market Committee (FOMC) as a separate legal entity, removal of the Treasury Secretary and the Comptroller of the Currency from the Fed’s governing board and establishment of the members’ terms at 14 years. Following World War II, the Employment Act added the goal of promising maximum employment to the list of the Fed’s responsibilities. In 1956 the Bank Holding Company Act named the Fed as the regulator of bank holding companies owning more than one bank, and in 1978 the Humphrey-Hawkins Act required the Fed chairman to report to Congress twice annually on monetary policy goals and objectives.
1951: The Treasury Accord
The Federal Reserve System formally committed to maintaining a low interest rate peg on government bonds in 1942 after the United States entered World War II. It did so at the request of the Treasury to allow the federal government to engage in cheaper debt financing of the war. To maintain the pegged rate, the Fed was forced to give up control of the size of its portfolio as well as the money stock. Conflict between the Treasury and the Fed came to the fore when the Treasury directed the central bank to maintain the peg after the start of the Korean War in 1950.
President Harry Truman and Secretary of the Treasury John Snyder were both strong supporters of the low interest rate peg. The President felt that it was his duty to protect patriotic citizens by not lowering the value of the bonds that they had purchased during the war. Unlike Truman and Snyder, the Federal Reserve was focused on the need to contain inflationary pressures in the economy caused by the intensification of the Korean War. Many on the Board of Governors, including Marriner Eccles, understood that the forced obligation to maintain the low peg on interest rates produced an excessive monetary expansion that caused inflation. After a fierce debate between the Fed and the Treasury for control over interest rates and U.S. monetary policy, their dispute was settled resulting in an agreement known as the Treasury-Fed Accord. This eliminated the obligation of the Fed to monetize the debt of the Treasury at a fixed rate and became essential to the independence of central banking and how monetary policy is pursued by the Federal Reserve today.
1970s-1980s: Inflation and Deflation
The 1970s saw inflation skyrocket as producer and consumer prices rose, oil prices soared and the federal deficit more than doubled. By August 1979, when Paul Volcker was sworn in as Fed chairman, drastic action was needed to break inflation’s stranglehold on the U.S. economy. Volcker’s leadership as Fed chairman during the 1980s, though painful in the short term, was successful overall in bringing double-digit inflation under control.
1980: Setting the Stage for Financial Modernization
The Monetary Control Act of 1980 required the Fed to price its financial services competitively against private sector providers and to establish reserve requirements for all eligible financial institutions. The act marks the beginning of a period of modern banking industry reforms. Following its passage, interstate banking proliferated, and banks began offering interest-paying accounts and instruments to attract customers from brokerage firms. Barriers to insurance activities, however, proved more difficult to circumvent. Nonetheless, momentum for change was steady, and by 1999 the Gramm-Leach-Bliley Act was passed, in essence, overturning the Glass-Steagall Act of 1933 and allowing banks to offer a menu of financial services, including investment banking and insurance.
1990s: The Longest Economic Expansion
Two months after Alan Greenspan took office as the Fed chairman, the stock market crashed on October 19, 1987. In response, he ordered the Fed to issue a one-sentence statement before the start of trading on October 20: “The Federal Reserve, consistent with its responsibilities as the nation’s central bank, affirmed today its readiness to serve as a source of liquidity to support the economic and financial system.” The 10-year economic expansion of the 1990s came to a close in March 2001 and was followed by a short, shallow recession ending in November 2001. In response to the bursting of the 1990s stock market bubble in the early years of the decade, the Fed lowered interest rates rapidly. Throughout the 1990s, the Fed used monetary policy on a number of occasions including the credit crunch of the early 1990s and the Russian default on government securities to keep potential financial problems from adversely affecting the real economy. The decade was marked by generally declining inflation and the longest peacetime economic expansion in our country’s history.
September 11, 2001
The effectiveness of the Federal Reserve as a central bank was put to the test on September 11, 2001 as the terrorist attacks on New York, Washington and Pennsylvania disrupted U.S. financial markets. The Fed issued a short statement reminiscent of its announcement in 1987: “The Federal Reserve System is open and operating. The discount window is available to meet liquidity needs.” In the days that followed, the Fed lowered interest rates and loaned more that $45 billion to financial institutions in order to provide stability to the U.S. economy. By the end of September, Fed lending had returned to pre- September 11 levels and a potential liquidity crunch had been averted. The Fed played the pivotal role in dampening the effects of the September 11 attacks on U.S. financial markets.
January 2003: Discount Window Operation Changes
In 2003, the Federal Reserve changed its discount window operations so as to have rates at the window set above the prevailing Fed Funds rate and provide rationing of loans to banks through interest rates.
2006 and Beyond: Financial Crisis and Response
During the early 2000s, low mortgage rates and expanded access to credit made homeownership possible for more people, increasing the demand for housing and driving up house prices. The housing boom got a boost from increased securitization of mortgages—a process in which mortgages were bundled together into securities that were traded in financial markets. Securitization of riskier mortgages expanded rapidly, including subprime mortgages made to borrowers with poor credit records.
Centralization of credit in the banks of the state, by means of a national bank with state capital and an exclusive monopoly.” — Fifth plank of the Communist Manifesto, 1848
Crisis has been very good to government growth. It happens this way: the central government never does wrong, yet the evil that lurks in the world will on occasion strike us. Sometimes the evil is external, as in 9-11, other times it is internal, as in the case of certain economic upheavals. When the crisis is mostly economic, the culprit is always the private sector, and the guilty parties are usually big shots who got swept away with avarice. With a lapdog media clamoring for “reform,” politicians pass more laws and flood the airwaves with rhetoric about how their new legislation will crush the forces of greed. Most of us then go about our business, hoping that causality is not an avenging angel.
In the era following the War of Secession, the federal government aggressively promoted development of the West through huge subsidies and other favors to business cronies. Corruption flourished, and overextended banks occasionally failed, causing panics in 1873, 1884, 1893, and 1907. Throughout this era there was growing opposition to sound money, eloquently expressed by railroad speculator Jay Cooke in 1869: “Why,” he asked, “should this Grand and Glorious country be stunted and dwarfed–its activities chilled and its very life blood curdled by these miserable ‘hard coin’ theories–the musty theories of a bygone age.” 
The Panic of 1907 is especially significant because it led to government-directed banking “reform.” The panic got underway when United Copper’s stock price collapsed. Knickerbocker Trust of New York had invested heavily in United Copper, and depositors made a run on the bank to get their money out. When Knickerbocker failed, depositors at other banks got nervous and demanded their money, igniting the panic. 
J. P. Morgan got together with other banking leaders and met virtually nonstop for three weeks to solve the crisis. They secured credit from foreign investors, redirected funds from strong banks to weak ones, and bought stock in foundering but still promising companies.  The panic died a few weeks later.
For the New York bankers, there remained a much more serious problem. The growth of state banks over the previous 20 years had slowly eroded their power. By 1896, state and other nonnational banks constituted 61% of the total, and by 1913, 71%. More significantly, nonnationals commanded 57% of banking resources by 1913. 
With such a troubling trend, what did the New York bankers do? They turned to their pals in Washington. As we’ve seen, from the time of Lincoln’s administration government sought to partner with business, delivering special favors in return for political support. This is mercantilism, the system we rejected in 1776. By the early 20th century, we were neck-deep in Progressive propaganda, and there was no viable group opposing government takeover of our lives. The once laissez-faire, sound-money Democratic Party died with the nomination of William Jennings Bryant for president in 1896. From that point on, both Republicans and Democrats were promoting more statism as the miracle cure for ills it had breeded.
Both Congress and the American Banking Association had been pushing for central banking since the 1890s. The Panic of 1907 gave them another excuse to go after it. Amid all the maneuvering and proposals, Morgan banker Henry Davison organized a duck hunting trip at Jekyll Island, Georgia in December, 1910. The ducks they took aim at were not the web-footed kind, but the unsuspecting American citizen who had always thought of money as gold.
The hunters were major players in American mercantilism: Senator Nelson Aldrich (R., R.I.), who had headed up the National Monetary Commission, a congressional committee dedicated to developing ideas for central banking; Frank Vanderlip of Rockefeller’s National City Bank; Paul Warburg of the investment firm of Kuhn, Loeb, & Co., who was there to promote the German central bank of Bismarck; Charles Norton of First National Bank of New York, a Morgan company; and Davison, a partner of J.P. Morgan’s. 
They devised a plan whereby a board of commercial bankers would supervise regional reserve banks. When Aldrich later introduced it to Congress, Democrats blocked it. In 1913, Carter Glass, a Democratic congressman from Virginia, used the Jekyll Island scheme as the basis for the Federal Reserve Act. 
The Act created 12 regional reserve banks ruled by a board of Washington bureaucrats, including the Treasury secretary and presidential appointees. Though the 12 reserve banks are officially “private” institutions, they’re little different than government agencies, as Murray Rothbard noted.
In this manner government seized what Rothbard called “a crucial command post” of the economy, and therefore of the American society.  It used crisis — repeated panics created by government meddling — and the economic illiteracy and trust of the public to achieve its purpose.
And what has it sown from its command post? A subtle means of wealth transfer. A method of taxing us without legislation. A way of counterfeiting money legally. “Through the purchase of [usually government] debt by a bank, fiat money is injected into the economy,” Gary North writes.  “Wealth then moves to those market participants who gain early access to this newly created fiat money,” who are usually politically connected. The ones on fixed incomes or without close government connections bear the cost of higher prices later, as the money injection passes through the economy.
As most people know by now, the Fed greatly reduced reserve requirements during the 1920s, expanding credit recklessly and generating a false prosperity that ended in the crash of 1929. People understood that the Fed was manufacturing dollars out of thin air and started to pull their money out of banks, converting them to gold. Roosevelt closed the banks, then announced it was illegal to own gold. He forced people to give back to the Fed what was rightfully theirs. In 1933 Roosevelt made the dollar fiat currency domestically, but backed by gold internationally.
Roosevelt also created the Federal Deposit Insurance Corporation (FDIC) in 1933, providing federal guarantee of bank deposits. Bank runs and the threat thereof have vanished, and most people believe this is good. But as Lew Rockwell observes, “The government-banking cartel regards the bank run–the threat of which used to keep wanton investing at bay–as against the national interest. As a result, the industry is perpetually shaky, and the largest banks are a menace to public life itself.” 
Prior to 1929 the government had never intervened to help recovery from a recession. Previous administrations had let recessions run their course and recovery, at the hands of the market, usually occurred in a year or less. Hoover, and then Roosevelt to a much greater degree, took the statist course and drove the economy into a prolonged depression. For this, Roosevelt has been deified.
The Fed is the keystone of government wrong-doing. As Ludwig von Mises wrote long ago, “Ideologically, [sound money] belongs in same class with political constitutions and bills of rights.”  In the name of civil liberty and civilization itself, the Fed should be abolished.
1. The Mystery of Banking, Murray Rothbard, New York: Richardson and Snyder, 1983. p. 135. (PDF version)
2. Separating Money and the State, Part I: Eighty Years of Destruction, Douglas E. French,
3. The Panic of 1907 and the Birth of the Federal Reserve, Jim Klann, 4. Rothbard, p. 136.
5. Rothbard, p. 137.
7. Taking Money Back, Murray Rothbard,
8. Rothbard, Mystery of Banking, Forward by Gary North.
9. Banks on the Dole, Llewellyn H. Rockwell, 10. The Theory of Money and Credit, Ludwig von Mises, Yale University Press, 1953, p. 414.
Col. Edward Mandell House
The “Fed” Begins Operation
Col. House, who Wilson called his “alter ego,” because he was his closest friend and most trusted advisor, anonymously wrote a novel in 1912 called Philip Dru: Administrator, which revealed the manner in which Wilson was controlled. House, who lobbied for the implementation of central banking, would now turn his attention towards a graduated income tax. Incidentally, a central bank providing inflatable currency and a graduated income tax were two of the ten points in the Communist Manifesto for socializing a country.
It was House who hand-picked the first Federal Reserve Board. He named Benjamin Strong as its first Chairman. In 1914, Paul M. Warburg quit his $500,000 a year job at Kuhn, Loeb and Co. to be on the Board, later resigning in 1918 during World War I because of his German connections.
The Banking Act of 1935 amended the Federal Reserve Act, changing its name to the Federal Reserve System, and reorganizing it in respect to the number of directors and length of term. Headed by a seven member Board of Governors appointed by the President and confirmed by the Senate for a 14 year term, the Board acts as an overseer to the nation’s money supply and banking system.
The Board of Governors, the President of the Federal Reserve Bank of New York, and four other Reserve Bank Presidents who serve on a rotating basis make up the “Federal Open Market Committee”. This group decides whether or not to buy and sell government securities on the open market. The Government buys and sells government securities, mostly through 21 Wall Street bond dealers, to create reserves to make the money needed to run the government. The Committee also determines the supply of money available to the nation’s banks and consumers.
There are twelve Federal Reserve Banks in twelve districts: Boston (MA), Cleveland (OH), New York (NY), Philadelphia (PA), Richmond (VA), Atlanta (GA), Chicago (IL), St. Louis (MO), Minneapolis (MN), Kansas City (KS), San Francisco (CA), and Dallas (TX). The twelve regional banks were set up so that the people wouldn’t think that the Federal Reserve was controlled from New York. Each of the Banks has nine men on [its] Board of Directors; six are elected by member Banks, and three are appointed by the Board of Governors.
They have 25 branch Banks, and many member Banks. All Federal Banks are members and four out of every ten commercial banks are members. In whole, the Federal Reserve System controls about 70% of the country’s bank deposits. Ohio Senator, Warren G. Harding, who was elected to the Presidency in 1920, said in a 1921 Congressional inquiry that the Reserve was a private banking monopoly. He said: “The Federal Reserve Bank is an institution owned by the stockholding member banks. The Government has not a dollar’s worth of stock in it.” His term was cut short in 1923 when he mysteriously died, leading to rumors that he was poisoned. This claim was never substantiated because his wife would not allow an autopsy.
Three years after the initiation of the Federal Reserve, Woodrow Wilson said: “The growth of the nation … and all our activities are 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 civilized world … no longer a government of free opinion, no longer a government by conviction and the free vote of the majority, but a government by the opinion and duress of a small group of dominant men.”
In 1919, John Maynard Keynes, later an advisor to Franklin D. Roosevelt, wrote in his book The Economic Consequences of Peace: “Lenin is to have declared that the best way to destroy the capitalist system was to debauch the currency … By a continuing process of inflation, governments can confiscate secretly and unobserved, an important part of the wealth of their citizens … As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless…”
Congressman Charles August Lindbergh, Sr., father of the historic aviator, said on the floor of the Congress: “This Act establishes the most gigantic trust on Earth … When the President signs this Act, the invisible government by the Money Power, proven to exist by the Money Trust investigation, will be legalized … This is the Aldrich Bill in disguise … The new law will create inflation whenever the Trusts want inflation … From now on, depressions will be scientifically created … The worst legislative crime of the ages is perpetrated by this banking and currency bill.”
On June 10, 1932, Louis T. McFadden, said in an address to the Congress: “We have in this country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve Banks … Some people think the Federal Reserve Banks are United States Government institutions. They are not Government institutions. They are private credit monopolies which prey upon the people of the United States for the benefit of themselves and their foreign customers … The Federal Reserve Banks are the agents of the foreign central banks … In that dark crew of financial pirates, there are those who would cut a man’s throat to get a dollar out of his pocket …
Every effort has been made by the Federal Reserve Board to conceal its powers, but the truth is the Fed has usurped the government. It controls everything here (in Congress) and controls all our foreign relations. It makes and breaks governments at will … When the Fed was passed, the people of the United States did not perceive that a world system was being set up here … A super-state controlled by international bankers, and international industrialists acting together to enslave the world for their own pleasure!”
On May 23, 1933, Louis T. McFadden brought impeachment charges against the members of the Federal Reserve: “Whereas I charge them jointly and severally with having brought about a repudiation of the national currency of the United States in order that the gold value of said currency might be given to private interests.