The New Alchemy,
A Tale of Three Banks
excerpted from the book
The Creature from Jekyll Island
a second look at the Federal Reserve
by G. Edward Griffin
American Media, 2008, paperback
(original 1994)
p218
No discussion of banking as a mechanism for financing wars would
be complete without turning eventually to the name Rothschild.
It was Mayer Amschel Rothschild who is quoted as saying: "Let
me issue and control a nation's money and I care not who writes
the laws." Biographer Frederic Morton concluded that the
Rothschild dynasty had: "... conquered the world more thoroughly,
more cunningly, and much more lastingly than all the Caesars before
or all the Hitlers after them." The dynasty was begun in
Frankfurt, Germany, in the middle of the eighteenth century by
Mayer Amschel Bauer, the son of a goldsmith. Mayer became a clerk
in the Oppenheimer Bank in Hanover and was eventually promoted
to junior partner. After his father's death, he returned to his
home in Frankfurt to continue the family business. Over the door
hung a red shield with an eagle as a sign to identify the establishment.
The German words for red shield are roth schild, so he changed
his name from Bauer to Rothschild and added five gold arrows held
in the talons of the eagle to represent his five sons.
The Rothschild fortune began when Mayer
adopted the practice of fractional-reserve banking. As we have
seen, he was not alone in this, but the House of Rothschild greatly
surpassed the competition. That was due to his sharp business
acumen and also because of his five most unusual sons, all of
whom became financial power centers of their own. As they matured
and learned the magic of converting debt into money, they moved
beyond the confines of Frankfurt and established additional operations
in the financial centers, not only of Europe, but of much of the
civilized world.
Throughout the first half of the nineteenth
century, the brothers conducted important transactions on behalf
of the governments of England, France, Prussia, Austria, Belgium,
Spain, Naples, Portugal, Brazil, various German states, and other
smaller countries. They were the personal bankers of many of the
crowned heads of Europe. They made large investments, through
agents, in markets as distant as the United States, India, Cuba,
and Australia. They were financiers to Cecil Rhodes, making it
possible for him to establish a monopoly over the diamond fields
of South Africa. They are still connected with the de Beers.
Biographer Derek Wilson writes:
Those who lampooned or vilified the Rothschilds
for their "sinister" influence had a considerable amount
of justification for their anger and anxiety. The banking community
had always constituted a "fifth estate" whose members
were able, by their control of royal purse ç strings, to
affect important events. But the house of Rothschild was immensely
more powerful than any financial empire that had ever preceded
it. It commanded vast wealth. It was international. It was independent.
Royal governments were nervous of it because they could not control
it. Popular movements hated it because it was not answerable to
the people. Constitutionalists resented it because its influence
was exercised behind the scenes-secretly.
Secrecy, of course, is essential for the
success of a cabal, and the Rothschilds perfected the art. By
remaining behind the scenes, they were able to avoid the brunt
of public anger which was directed, instead, at the political
figures which they largely controlled.
p226
Nathan Rothschild and the battle at Waterloo between Wellington
and Napoleon
It was well known that the Rothschilds
had developed a private courier service that was used, not only
to transport gold and other tangible cargo, but to rapidly move
information that could be useful in making investment decisions.
It was expected, therefore, that Nathan in London would be the
first to know the name of the victor after the cannon smoke had
cleared from the battlefield. And they were not to be disappointed.
The first news of Wellington's victory arrived in Brussels around
midnight on June 18, 1815, where a Rothschild agent named Rothworth
was waiting in readiness. He immediately mounted a fresh horse
and set off for the port of Ostend where a boat was standing by
to speed him across the channel to London. In the early hours
of June 20, the exhausted messenger was pounding on Nathan's door,
a full twenty-four hours before Wellington's own courier, Major
Henry Percy, arrived.
At least one friendly biographer claims
that Nathan's first act was to deliver the news to the Prime Minister,
but that government officials were hesitant at first to believe
it, because it ran contrary to reports they had received previously
telling of serious British setbacks. At any rate, there is no
doubt that Nathan's second act of the morning was to set off for
the stock exchange to take up a position at his usual pillar.
All eyes were upon him as he slumped dejectedly,
staring at the floor. Then, he raised his gaze and, with pained
expression, began to sell. The whisper went through the crowded
room, "Nathan is selling?" "Nathan is selling!"
"Wellington must have lost." "Our government bonds
will never be repaid." "Sell them now. Sell. Sell!"
Prices tumbled, and Nathan sold again.
Prices plummeted, and still Nathan sold. Finally, prices collapsed
altogether and, in one quick move, Nathan reversed his call and
purchased the entire market in government bonds. In a matter of
just a few hours, he had acquired the dominant holding of England's
entire debt at but a tiny fraction of its worth.
p228
There have always been men who were in a position to make private
fortunes out of cooperating with both sides in a war. The Rothschilds
were not unique in this, but they no doubt perfected the art and
became the personification of that breed. They were not necessarily
evil in a moral sense. What preoccupied their minds were not questions
of right or wrong but of profit and loss. This analytical indifference
to human suffering was aptly described by one Rothschild when
he said: "When the streets of Paris are running with blood,
I buy." They may have held citizenship in the country of
their residence, but patriotism was beyond their comprehension.
They were also very bright, if not cunning, and these combined
traits made them the role model of the cool pragmatists who dominate
the political and financial world of today.
p229
One of the great puzzles of history is why governments always
go into debt and seldom attempt to put themselves on a "pay-as-you-go"
basis. A partial answer is that kings and politicians lack the
courage to tax their subjects the enormous sums that would be
required under such an arrangement. There is also the deeper question
of why the expenditures are so high in the first place.
Given the mentality of the world's financial
lords and masters ... it is conceivable that a coldly calculated
strategy has been developed over the years to insure this result.
In fact, the historical evidence strongly suggests that just such
a plan was developed in eighteenth-century Europe and perfected
in twentieth-century America. For the purposes of hypothetical
analysis, let us identify this strategy as The Rothschild Formula.
Let us imagine a man who is totally pragmatic.
He is smarter and more cunning than most men and, in fact, holds
them in thinly disguised contempt. He may respect the talents
of a few, but has little concern over the condition of mankind.
He has observed that kings and politicians are always fighting
over something or other and has concluded that wars are inevitable.
He also has learned that wars can be profitable, not only by lending
or creating the money to finance them, but from government favoritism
in the granting of commercial subsidies or monopolies. He is not
capable of such a primitive feeling as patriotism, so he is free
to participate in the funding of any side in any conflict, limited
only by factors of self interest. If such a man were to survey
the world around him, it is not difficult to imagine that he would
come to the following conclusions which would become the prime
directives of his career:
1. War is the ultimate discipline to any
government. If it can successfully meet the challenge of war,
it will survive. If it cannot, it will perish. All else is secondary.
The sanctity of its laws, the prosperity of its citizens, and
the solvency of its treasury will be quickly sacrificed by any
government in its primal act of self-survival.
2. All that is necessary, therefore, to
insure that a government will maintain or expand its debt is to
involve it in war or the threat of war. The greater the threat
and the more destructive the war, the greater the need for debt.
3. To involve a country in war or the
threat of war, it will be necessary for it to have enemies with
credible military might. If such enemies already exist, all the
better. If they exist but lack military strength, it will be necessary
to provide them the money to build their war machine. If an enemy
does not exist at all, then it will be necessary to create one
by financing the rise of a hostile regime.
4. The ultimate obstacle is a government
which declines to finance its wars through debt. Although this
seldom happens, when it does, it will be necessary to encourage
internal political opposition, insurrection, or revolution to
replace that government with one that is more compliant to our
will. The assassination of heads of state could play an important
role in this process.
5. No nation can be allowed to remain
militarily stronger than its adversaries, for that could lead
to peace and a reduction of debt. To accomplish this balance of
power, it may be necessary to finance both sides of the conflict.
Unless one of the combatants is hostile to our interests and,
therefore, must be destroyed, neither side should be allowed a
decisive victory or defeat. While we must always proclaim the
virtues of peace, the unspoken objective is perpetual war.
Whether anyone actually put this strategy
into words or passed it along from generation to generation is
not important. In fact, it is doubtful it has ever worked that
way. Whether it is the product of conscious planning or merely
the consequence of men responding to the profit opportunities
inherent in fiat money, the world's financial lords have acted
as though they were following such a plan.
p232
By the end of the eighteenth century, the House of Rothschild
had become one of the most successful financial institutions the
world has ever known... As pioneers in the practice of lending
money to governments, they soon learned that this provided unique
opportunities to parlay wealth into political power as well. Before
long, most of the princes and kings of Europe had come within
their influence.
... The fact that different branches of
the Rothschild network might be providing funds for the enemy
was pragmatically ignored. Thus, a time-honored practice among
financiers was born: profiting from both sides.
... [There is a] special breed of international
financiers whose success typically is built upon certain character
traits. Those include cold objectivity, immunity to patriotism,
and indifference to the human condition. That profile is the basis
for proposing a theoretical strategy, called the Rothschild Formula,
which motivates such men to propel governments into war for the
profits they yield... As long as the mechanism of central banking
exists, it will be to such men an irresistible temptation to convert
debt into perpetual war and war into perpetual debt.
p260
To finance the early stages of World War I, England and France
had borrowed heavily from investors in America and had selected
the House of Morgan as sales agent for their bonds. Morgan also
acted as their U.S. purchasing agent for war materials, thus profiting
from both ends of the cash flow: once when the money was borrowed
and again when it was spent. Further profits were derived from
production contracts placed with companies within the Morgan orbit.
But the war began to go badly for the Allies when Germany's submarines
took virtual control of the Atlantic shipping lanes. As England
and France moved closer to defeat or a negotiated peace on Germany's
terms, it became increasingly difficult to sell their bonds. No
bonds meant no purchases, and the Morgan cash flow was threatened.
Furthermore, if the previously sold bonds should go into default,
as they certainly would in the wake of defeat, the Morgan consortium
would suffer gigantic losses.
The only way to save the British Empire,
to restore the value of the bonds, and to sustain the Morgan cash
flow was for the United States government to provide the money.
But, since neutral nations were prohibited from doing that by
treaty, America would have to be brought into the war. A secret
agreement to that effect was made between British officials and
Colonel House, with the concurrence of the President. From that
point forward, Wilson began to pressure Congress for a declaration
of war. This was done at the very time he was campaigning for
election on the slogan "He kept us out of war." Meanwhile,
Morgan purchased control over major segments of the news media
and engineered a nation-wide editorial blitz against Germany,
calling for war as an act of American patriotism.
... The Lusitania was built to military
specifications and was registered with the British Admiralty as
an armed auxiliary cruiser. She carried passengers as a cover
to conceal her real mission, which was to bring contraband war
materials from the United States. This fact was known to Wilson
and others in his administration, but they did nothing to stop
it.
... The British knew that to draw the
United States into the war would mean the difference between defeat
and victory, and anything that could accomplish that was proper-even
the coldly calculated sacrifice of one of her great ships [the
Lusitania] with Englishmen aboard. But the trick was to have Americans
on board also in order to create the proper emotional climate
in the United States.
... The deed had been done, and it set
in motion great waves of revulsion against the Germans. These
waves eventually flooded through Washington and swept the United
States into war. Within days of the declaration, Congress voted
$1 billion in credit for England and France. $200 million was
sent to England immediately and was applied to the Morgan account.
The vast quantity of money needed to finance the war was created
by the Federal Reserve System, which means it was collected from
Americans through that hidden tax called inflation.
... The separate motives of such diverse
personalities as Winston Churchill, J.P. Morgan, Colonel House,
and Woodrow Wilson all found common cause in bringing America
into World War I. Churchill maneuvered for military advantage,
Morgan sought the profits of war, House schemed for political
power, and Wilson dreamed of a chance to dominate a post-war League
of Nations.
p269
Dr. Carroll Quigley, professor of history at Georgetown University,
and author of the book 'Tragedy and Hope', about the world's money
power structure. He describes the goal of this network of world
financiers as being:
... nothing less than to create a world
system of financial control in private hands able to dominate
the political system of each country and the economy of the world
as a whole. This system was to be controlled in a feudalist fashion
by the central banks of the world acting in concert, by secret
agreements arrived at in frequent private meetings and conferences...
Each central bank, in the hands of men
like Montagu Norman of the Bank of England, Benjamin Strong of
the New York Federal Reserve Bank, Charles Rist of the Bank of
France, and Hjalmar Schacht of the Reichsbank, sought to dominate
its government by its ability to control treasury loans, to manipulate
foreign exchanges, to influence the level of economic activity
in the country, and to influence cooperative politicians by subsequent
economic rewards in the business world.
p270
In 1870, a wealthy British socialist by the name of john Ruskin
( was appointed as professor of fine arts at Oxford University
in London. He taught that the state must take control of the means
of production and organize them for the good of the community
as a whole. He advocated placing control of the state into the
hands of a small ruling class, perhaps even a single dictator.
He said: "My continual aim has been to show the eternal superiority
of some men to others, sometimes even of one man to all others."
This, of course, is the same intellectual
appeal of Communism. Lenin taught that the masses could not be
trusted to handle their own affairs and that a special group of
disciplined intellectuals must assume this role for them. That
is the function of the Communist Party, which never comprises
more than about three per cent of the population. Even when the
charade of free elections is allowed, only members of the Party-or
those over whom the KGB has total control-are permitted to run
for office. The concept that a ruling party or class is the ideal
structure for society is at the heart of all collectivist schemes,
regardless of whether they are called Socialism, Communism, Nazism,
Fascism, or any other "ism" which may yet be invented
to disguise it. It is easy, therefore, for adherents of this elitist
mentality to be comfortable in almost any of these collectivist
camps, a fact to which Dr. Quigley alluded when he wrote: "This
network, which we may-identify as the Round Table Groups, has
no aversion to cooperating with the communists, or any other groups,
and frequently does so."
Returning to the subject of the origins
of this group, however, Dr. Quigley tells us:
Ruskin spoke to the Oxford undergraduates
as members of the privileged ruling class. He told them that they
were the possessors of a magnificent tradition of education, beauty,
rule of law, freedom, decency, and self-discipline, but that this
tradition could not be saved, and did not deserve to be saved,
unless it could be extended to the lower classes in England itself
and to the non-English masses throughout the world.
Ruskin's message had a sensational impact.
His inaugural lecture was copied out in long-hand by one undergraduate,
Cecil Rhodes, who kept it with him for thirty years.
Cecil Rhodes made one of the world's greatest
fortunes. With the cooperation of the Bank of England and financiers
like Rothschild, he was able to establish a virtual monopoly over
the diamond output of South Africa and most of the country's gold
as well. The major portion of this vast income was spent to advance
the ruling-class ideas of John Ruskin.
Dr. Quigley explains:
The Rhodes Scholarships, established by
the terms of Cecil Rhodes' seventh will, are known to everyone.
What is not so widely known is that Rhodes in five previous wills
left his fortune to form a secret society, which was to devote
itself to the preservation and expansion of the British Empire.
And what does not seem to be known to anyone is that this secret
society was created by Rhodes and principal trustee, Lord Miler,
and continues to exist to this day .... In his book on Rhodes'
wills, he [Stead, who was a member of the inner circle wrote in
one place: "Mr. Rhodes was more than the founder of a dynasty.
He aspired to be the creator of one of those vast semi-religious,
quasi-political associations which, like the Society of Jesus,
have played so large a part in the history of the world. To be
more strictly accurate, he wished to found an Order as the instrument
of the will of the Dynasty."
In this secret society Rhodes was to be
leader(Stead, Brett (Lord Esher), and Miner were to form an executive
committee; Arthur (Lord) Balfour, (Sir) Harry Johnston, Lord Rothschild,
Albert (Lord) Grey, and others were listed as potential members
of a "Circle of Initiates;" while there was to be an
outer circle known as the Association of Helpers" (later
organized by Miler as the Round Table organization).
p272
... the classical pattern of political conspiracy. This was the
structure that made it possible for Quigley to differentiate between
an international "network" and the secret society within
that network. At the center, there is always a tiny group in complete
control, with one man as the undisputed leader. Next is a circle
of secondary leadership that, for the most part, is unaware of
an inner core. They are led to believe that they are the inner-most
ring.
In time, as these conspiracies are built
from the center out, they form additional rings of organization.
Those in the outer echelons usually are idealists with an honest
desire to improve the world. They never suspect an inner control
for other purposes, and only those few who demonstrate a ruthless
capacity for higher leadership are ever allowed to see it.
After the death of Cecil Rhodes, the inner
core of his secret society fell under the control of Lord Alfred
Milner, Governor-General and High Commissioner of South Africa.
As director of a number of public banks and as corporate precursor
of England's Midland Bank, he became one of the greatest political
and financial powers in the world. Miler recruited into his secret
society a group of young men chiefly from Oxford and Toynbee Hall
and, according to Quigley:
Through his influence these men were able
to win influential posts in government and international finance
and became the dominant influence in British imperial and foreign
affairs up to 1939 .... In 1909-1913 they organized semi-secret
groups, known as Round Table Groups, in the chief British dependencies
and the United States ....
Money for the widely ramified activities
of this organization came chiefly from the Rhodes Trust itself,
and from wealthy associates such as the Beit brothers, from Sir
Abe Bailey, and (after 1915) from the Astor family ... and from
foundations and firms associated with the international banking
fraternity, especially the Carnegie United Kingdom Trust, and
other organizations associated with J.P. Morgan, the Rockefeller
and Whitney families, and the associates of Lazard Brothers and
of Morgan, Grenfell, and Company ....
At the end of the war of 1914, it became
clear that the organization of this system had to be greatly extended.
Once again the task was entrusted to Lionel Curtis who established,
in England and each dominion, a front organization to the existing
local Round Table Group. This front organization, called the Royal
Institute of International Affairs, had as its nucleus in each
area the existing submerged Round Table Group. In New York it
was known as the Council on Foreign Relations, and was a front
for J.P. Morgan and Company in association with the very small
American Round Table Group. 1
The Council on Foreign Relations was a
spin-off from the failure of the world's leaders at the end of
World War I to embrace the League of Nations as a true world government.
It became clear to the master planners that they had been unrealistic
in their expectations for rapid acceptance. If their plan were
to be carried forward, it would have to be done on the basis of
patient gradualism symbolized by the Fabian turtle. Rose Martin
says:
Colonel House was only one man, where
a multitude was needed. He had set the pattern and outlined goals
for the future, and he still had a scheme or two in mind. In particular,
he foresaw it would be necessary for the Fabians to develop a
top level Anglo-American planning group in the field of foreign
relations which could secretly influence policy on the one hand
and gradually "educate" public opinion on the other
....
To the ambitious young Fabians, British
and American, who had flocked to the peace conference [Versailles]
as economists and junior officials, it soon became evident that
a New World Order [League of Nations] was not about to be produced
at Paris. For them, Colonel House arranged a dinner meeting at
the Hotel Majestic on May 19, 1919, together with a select group
of Fabian-certified Englishmen - notably, Arnold Toynbee, R.H.
Tawney and John Maynard Keynes. All were equally disillusioned,
for various reasons, by the consequences of the peace. They made
a gentlemen's agreement to set up an organization, with branches
in England and America, "to facilitate the scientific study
of international questions." As a result two potent and closely
related opinion-making bodies were founded .... The English branch
was called the Royal Institute of International Affairs. The American
branch, first known as the Institute of International Affairs,
was reorganized in 1921 as the Council on Foreign Relations.
It is through this front group, called
the Council on Foreign Relations, and its influence over the media,
tax-exempt foundations, universities, and government agencies
that the international financiers have been able to dominate the
domestic and foreign policies of the United States ever since.
p283
The Bolshevik revolution was not a spontaneous uprising of the
masses. It was planned, financed, and orchestrated by outside...
most of the money and leadership came from financiers in England
and the United States... This group centered mainly around a secret
society created Cecil Rhodes, one of the world's wealthiest men
at the time. The purpose of that group was nothing less than world
dominion and the establishment of a modern feudalist society controlled
by the world's central banks. Headquartered in England, the Rhodes
inner-most directorate was called the Round Table. In other countries,
there were established subordinate structures called Round Table
Groups. The Round-Table Group in the United States became known
as the Council on Foreign Relations. The CFR, which was initially
dominated by J.P. Morgan and later by the Rockefellers, is the
most powerful group in America today. It is even more powerful
than the federal government, because almost all of the key positions
in government are held by its members. In other words, it is the
United States government.
p285
There were two revolutions in Russia that year [1917], not one.
The first, called the February Revolution, resulted in the establishment
of a provisional socialist government under the leadership of
Aleksandr Kerensky. It was relatively moderate in its policies
and attempted to accommodate all revolutionary factions including
the Bolsheviks who were the smallest minority. When the February
Revolution occurred, Lenin and Trotsky were not even in Russia...
The second revolution, called the October
Revolution, was the one through which the Bolsheviks came to power.
It was, in fact, no revolution at all. It was a coup d'etat. The
Bolsheviks simply took advantage of the confusion and indecisiveness
that existed among the various groups that comprised the new government
and caught them by surprise with a lightening strike of force.
With a combination of bribes and propaganda, they recruited several
regiments of soldiers and sailors and, in the early morning darkness
of October 25, methodically took military possession of all government
buildings and communication centers. No one was prepared for such
audacity, and resistance was almost non-existent. By dawn, without
the Russian people even knowing what had happened-much less having
any voice in that action, their country had been captured by a
minority faction and became the world's first so-called "people's
republic." Within two days, Kerensky had fled for his life,
and all Provisional Government ministers had been arrested. That
is how the Communists seized Russia and that is how they held
it afterward. Contrary to the Marxian myth, they have never re
resented the people. They simply have the guns.
p287
Eugene Lyons in his book, Workers' Paradise
Lost
Lenin, Trotsky, and their cohorts did
not overthrow the monarchy. They overthrew the first democratic
society in Russian history, set up through a truly popular revolution
in March, 1917 .... They represented the smallest of the Russian
radical movements .... But theirs was a movement that scoffed
at numbers and frankly mistrusted the multitudes. The workers
could be educated for their role after the revolution; they would
not be led but driven to their terrestrial heaven...
On the brink of the dictatorship, Lenin
dared to promise that the state will fade away, since "all
need of force will vanish." Not at some remote future, but
at once: "The proletarian state begins to wither immediately
after its triumph, for in a classless society a state is unnecessary
and impossible .... Soviet power is a new kind of state, in which
there is no bureaucracy, no police, no standing army." Also:
"So long as the state exists, there is no freedom. When there
is freedom, there will be no state."
Within a few months after they attained
power, most of the tsarist practices the Leninists had condemned
were revived, usually in more ominous forms: political prisoners,
convictions without trial and without the formality of charges,
savage persecution of dissenting views, death penalties for more
varieties of crime than in any other modern nation. The rest were
put into effect in the following years, including the suppression
of all other parties, restoration of the internal passport, a
state monopoly of the press, along with repressive practices the
monarchy had outlived for a century or more.
p288
Lenin and Trotsky were not sent to Russia to overthrow the anti-Semitic
Tsar. Their assignment from Wall Street was to overthrow the revolution.
p295
From the beginning of Hitler's rise to power, German industry
was heavily financed by American and British bankers. Most of
the largest U.S. Corporations were knowingly invested in war industries.
I.G. Farben was the largest of the industrial cartels and was
a primary source of political funding for Hitler. It was Farben
that staffed and directed Hitler's intelligence section and ran
the Nazi slave labor camps as a supplemental source of manpower
for Germany's factories. Farben even hired the New York public
relations firm of Ivy Lee, who was John D. Rockefeller's PR specialist,
to help improve Hitler's public image in America.
p295
Much of the capital for the expansion of I.G. Farben came from
Wall Street, primarily Rockefeller's National City Bank.
p295
During the Allied bombing raids over Germany, the factories and
administrative buildings of I.G. Farben were spared upon instructions
from the U.S. War Department. The War Department was liberally
staffed with men, who in civilian life, had been associates of
investment firms.
p295
During World War II, under the Lend-Lease program, the United
States sent to the Soviets more than $11 billion in aid, including
14,000 aircraft, nearly half a million tanks and other military
vehicles, more than 400 combat ships, and even half of the entire
U.S. supply of uranium which then was critically needed for the
development of the atomic bomb. But fully one-third of all the
Lend-Lease shipments during this period comprised industrial equipment
and supplies to be used for the development of the Russian economy
after the war.
p296
With the termination of the Lend-Lease program, it was necessary
to invent new mechanisms for the support of Soviet Russia and
her satellites. One of these was the sale of much-needed commodities
at prices below the world market and, in fact, below the prices
that Americans themselves had to pay for the same items. This
meant, of course-as it did in the case of Lend Lease-that the
American taxpayer had to make up the difference. The Soviets were
not even required to have the money to buy these goods. American
financial institutions, the federal government, and international
agencies, which are largely funded by the federal government,
such as the International Monetary Fund and the World Bank-lent
the money to them. Furthermore, the interest rates on these loans
also are below the market requiring still additional subsidy by
American citizens. And that is not all. Almost all of these loans
have been guaranteed by the United States government, which means
that if-no, make that when-these countries default in their payments,
the gullible American public is once again called upon to make
them good. In other words, the new mechanism, innocently and deceptively
referred to as "trade," is little more than a thinly
disguised means by which members of the Round Table who direct
our national policies have bled billions of dollars from American
citizens for an ongoing economic transfusion into the Soviet bloc-and
continue to do so now that the word Soviet has been changed to
the less offensive Democratic Socialism. This enables those regimes
to enter into contracts with American businessmen to provide essential
services. And the circle is complete: From the American taxpayer
to the American government to the "socialist" regime
to the American businessman and, ultimately, to the American financier
who funded the project and provided the political influence to
make it all possible.
p297
These men [members of the Round Table network/the world's money-power
structure] are incapable of genuine patriotism. They think of
themselves, not as citizens of any particular country, but as
citizens of the world. They can do business just as easily with
bloodthirsty dictatorships as with any other government-especially
since they are assured by the transfer mechanism that the American
taxpayer is going to make good on the deal.
When David Rockefeller was asked about
the propriety of providing funding for Marxist and Communist countries
which are openly hostile to the United States, he responded: "I
don't think an international bank such as ours ought to try to
set itself as a judge about what kind of government a country
wishes to have."
Wishes to have? He was talking about Angola
where the Marxist dictatorship was forced upon the people with
Cuban soldiers and Soviet weapons!
Thomas Theobald, Vice President of Citicorp
was asked in 1981 about his bank's loans to Poland. Was he embarrassed
by making loans to a Communist country, especially following the
regime's brutal repression of free-trade unions? Not at all. "Who
knows which political system works?" he replied. "The
only test we care about is, can they pay their bills." What
he meant, of course, was can the American taxpayer pay Poland's
bills.
p302
In the beginning, the Council on Foreign Relations was dominated
by J.P. Morgan. It is still controlled by international financiers.
The Morgan group gradually has been replaced by the Rockefeller
consortium, and the roll call of participating businesses now
reads like the Fortune 500.
p303
The alchemists of ancient times vainly sought the philosopher'
stone which they believed would turn lead into gold. Is it possible
that such a stone actually has been found? Can it be that the
money alchemists of our own time have learned how to transmute
war into debt, and debt into war, and both into gold for themselves?
p303
We theorized a strategy, dubbed the Rothschild Formula, in which
the world's money cabal deliberately encourages war as a means
of stimulating the profitable production of armaments and of keeping
nations perpetually in debt.
p304
In the Gulf War, every effort was made to insure that [Saddam]
Hussein's regime was contained but not destroyed... His military
infrastructure and most of his weapons were spared. After the
cease fire, he was allowed to keep his fleet of helicopter gunships,
which he promptly used to put down a large-scale internal revolt.
The big pill to swallow is that, for many
years, Hussein was an asset to the global planners in the West,
and they did everything possible to keep him in power. It was
only when he refused to allow U.S. companies to dominate Iraqi
oil production that he was seriously targeted. Prior to that,
he was untouchable precisely because he was widely perceived as
a perfect, despicable enemy.
p304
Fareed Zakaria, Managing Editor of the Council on Foreign Relations'
(CFR) journal, Foreign Affairs, in 1996
It's tempting to get rid of Saddam. But
his bad behavior actually serves America's purposes in the region
.... If Saddam Hussein did not exist, we would have to invent
him .... The end of Saddam Hussein would be the end of the anti-Saddam
coalition. Nothing destroys an alliance like the disappearance
of the enemy .... Maintaining a long-term American presence in
the gulf would be difficult in the absence of a regional threat.
p305
Council on Foreign Relations (CFR) policymakers ... are implementing
the Rothschild Formula. To justify world government, there must
be wars. Wars require enemies with frightful weapons is one of
the best enemies money can buy.
p305
There are few historians who would challenge the fact that the
funding of World War I, World War II, the Korean War, and the
Vietnam War was accomplished ... through the Federal Reserve System.
An overview of all wars since the establishment of the Bank of
England in 1694 suggests that most of them would have been greatly
reduced in severity, or perhaps not even fought at all, without
fiat money. It is the ability of governments to acquire money
without direct taxation that makes modern warfare possible, and
a central bank has become the preferred method of accomplishing
that.
p306
The Bolshevik Revolution was a coup d'etat in which a radical
minority captured the Russian government from the moderate revolutionary
majority. The Red Cross Mission of New York financiers threw support
to the Bolsheviks and, in return, received economic rewards in
the form of rights to Russia's natural resources plus contracts
for construction and supplies. The continued participation in
the economic development of Russia and Eastern Europe since that
time indicates that this relationship has survived to the present
day. These financiers are not pro-Communist. Their motivation
is profit and power. They are now working to bring both Russia
and the United States into a world government which they expect
to control. War and threats of war are tools to prod the masses
toward the acceptance of that goal. It is essential, therefore,
that the United States and the industrialized nations of world
have credible enemies. As these words are being written, Russia
is wearing the mask of peace and cooperation. But we have seen
that before. We may yet see a return of the Evil Empire when the
timing is right. U.S. government and megabank funding, first of
Russian, and now of Chinese and Middle-East military capabilities,
cannot be understood without this insight.
p339
America had its first central bank even before the Constitution
was drafted. It was called the Bank of North America and was chartered
by the Continental Congress in 1781. Modeled after the Bank of
England, it was authorized to issue more paper promissory notes
than it held in deposits. In the beginning, these notes were widely
circulated and served as a national currency. Although the bank
was essentially a private institution, it was designed for the
purpose of creating money to lend to the federal government, which
it did from the start.
The Bank of North America was riddled
with fraud, and it quickly fell into political disfavor. Its inflated
bank notes eventually were rejected by ordinary citizens and ceased
to circulate outside of the Bank's home city of Philadelphia.
Its charter was allowed to expire and, in 1783, it was converted
into a purely commercial bank chartered by the state of Pennsylvania.
The advocates of fiat money did not give
up. In 1791, the First Bank of the United States (America's second
central bank) was created by Congress. The new bank was a replica
of the first, including fraud. Private investors in the Bank were
among the nation's most wealthy and influential citizens, including
some Congressmen and Senators. But the largest investment and
the most powerful influence in the new Bank came from the Rothschilds
in Europe.
The Bank set about immediately to serve
its function of creating money for the government. This led to
a massive inflation of the money supply and rising prices. In
the first five years, 42% of everything people had saved in the
form of money was confiscated through the hidden tax called inflation.
This was the same phenomenon that had plagued the colonies less
than two decades earlier, but instead of being caused by printing-press
money, it was now fueled by fractional-reserve bank notes created
by a central bank.
As the time for renewal of the Bank's
charter approached, two groups with opposite intentions became
strange political allies against it: the Jeffersonians who wanted
sound money; and the frontier banks, called wildcatters, who wanted
unlimited license to steal. On January 24, 1811, the charter was
defeated by one vote in the Senate and one in the House. The central
bank was gone, but the wildcatters were everywhere.
The War of 1812 was not popular among
the American public, and funding would have been impossible through
taxes alone. The government chose to fund the war by encouraging
wildcat banks to purchase its war-debt bonds and convert them
into bank notes which the government then used to purchase war
material. Within two years, the nation's money supply had tripled,
and so had prices. Once again, the monetary and political scientists
had succeeded in fleecing the American public of approximately
66% of all the money they held during that period. And that was
on top of the 42% fleecing they got a few years earlier by the
Bank of the United States.
p359
The government had encouraged widespread banking fraud during
the War of 1812 as an expedient for paying its bills, and this
had left the nation in monetary chaos. At the end of the war,
instead of allowing the fraudulent banks to fall and letting the
free market heal the damage, Congress decided to protect the banks,
to organize the fraud, and to perpetuate the losses. It did this
by creating the nation's third central bank called the Second
Bank of the United States.
The new bank was almost an exact carbon
copy of the previous one. It was authorized to create money for
the federal government and to regulate state banks. It influenced
larger amounts of capital and was better organized across state
lines than the old bank. Consequently its policies had a greater
impact on the creation and extinguishing of the nation's money
supply. For the first time in our history, the effects began to
ricochet across the entire country at once instead of being confined
to geographical regions. The age of the boom-bust cycle had at
last arrived in America.
In 1820, public opinion began to swing
back in favor of the sound-money principles espoused by the Jeffersonian
Republicans. But since the Republican Party had by then abandoned
those principles, a new coalition was formed, headed by Martin
Van Buren and Andrew Jackson, called the Democrat Party. One of
its primary platforms was the abolishment of the Bank. After Jackson
was elected in 1828, he began in full earnest to bring that about.
The head of the Bank was a formidable
adversary by the name of Nicholas Biddle. Biddle, not only possessed
great personal abilities, but many members of Congress were indebted
to him for business favors. Consequently, the Bank had many political
friends.
As Jackson's first term of office neared
its end, Biddle asked Congress for an early renewal of the Bank's
charter, hoping that Jackson would not risk controversy in a reelection
year. The bill was easily passed, but Jackson accepted the challenge
and vetoed the measure. Thus, a battle over the Bank's future
became the primary presidential campaign issue.
Jackson was reelected by a large margin,
and one of his first acts was to remove federal deposits from
the Bank and place them into private, regional banks. Biddle counterattacked
by contracting credit and calling in loans. This was calculated
to shrink the money supply and trigger a national panic-depression,
which it did. He publicly blamed the downturn on Jackson's removal
of deposits.
The plan almost worked. Biddle's political
allies succeeded in having Jackson officially censured in the
Senate. However, when the truth about Biddle's strategy finally
leaked out, it backfired against him. He was called before a special
Congressional investigative committee to explain his actions,
the censure against Jackson was rescinded, and the nation's third
central bank passed into oblivion.
p375
The Second Bank of the United States was dead, but banking was
very much alive. Many of the old problems continued, and new ones
arrived. The issuance of banknotes had been severely limited,
but that was largely offset by the increasing use of checkbook
money, which had no limits at all on its issue.
When The Second Bank of the U.S. slipped
into history, the nation was nearing the end of the boom phase
of a boom/bust cycle. When the inevitable contraction of the money
supply came, politicians began to offer proposals on how to infuse
stability into the banking system. None dealt with the real problem,
which was fractional-reserve banking itself. They concentrated
instead on proposals on how to make it work. All of these proposals
were tried and they failed.
These years are sometimes described as
a period of free banking, which is an insult to truth. All that
happened was that banks were converted from corporations to private
associations, a change in form, not substance. They continued
to be burdened by government controls, regulations, supports,
and other blocks against the free market.
The economic chaos and conflict of this
period was a major cause of the Civil War. Lincoln made it clear
during his public speeches that slavery was not the issue. The
basic problem was that North and South were dependent on each
other for trade. The industrialized North sold its products to
the South which sold its cotton to the North. The South also had
a similar trade with Europe, and that was an annoyance to the
North. Europe was selling many products at lower prices, and the
North was losing market share. Northern politicians passed protectionist
legislation putting import duties on industrial products. This
all but stopped the importation of European goods and forced the
South to buy from the North at higher prices. Europe retaliated
by curtailing the purchase of American cotton. That hurt the South
even more. It was a classic case of legalized plunder, and the
South wanted out.
Meanwhile, there were powerful forces
in Europe that wanted to see America embroiled in civil war. If
she could be split into two hostile countries, there would be
less obstacle to European expansion on the North American continent.
France was eager to capture Mexico and graft it onto a new empire
which would include many of the Southern states as well. England,
on the other hand, had military forces poised along the Canadian
border ready for action. Political agitators, funded and organized
from Europe, were active on both sides of the Mason-Dixon line.
The issue of slavery was but j a ploy. America had become the
target in a ruthless game of world economics and politics.
p395
America's bloodiest and most devastating war [Civil War] was
fought, not over the issue of freedom versus slavery, but because
of clashing economic interests. At the heart of this conflict
were questions of legalized plunder, banking monopolies, and even
European territorial expansion into Latin America. The boot print
of the Rothschild formula is unmistakable across the graves of
American soldiers on both sides.
In the North, neither greenbacks, taxes,
nor war bonds were enough to finance the war. So a national banking
system was created to convert government bonds into fiat money,
and the people lost over half of their monetary assets to the
hidden tax of inflation. In the South, printing presses accomplished
the same effect, and the monetary loss was total.
The issuance of the Emancipation Proclamation
by Lincoln and the naval assistance offered by Tsar Alexander,
II, were largely responsible for keeping England and France from
intervening in the war on the side of the Confederacy. Lincoln
was assassinated by a member of the Knights of the Golden Circle,
a secret society with rumored ties to American politicians and
British financiers. Tsar Alexander was assassinated a few years
later by a member of the People's Will, a Nihilist secret society
in Russia with rumored ties to financiers in New York City, specifically,
Jacob Schiff and the firm of Kuhn, Loeb & Company.
As for the Creature of central banking,
there had been some victories and some defeats. The greenbacks
had for a while deprived the bankers of their override on a small
portion of government debt, but the National Banking Act quickly
put a stop to that. Furthermore, by using government bonds as
backing for the money supply, it locked the nation into perpetual
debt. The foundation was firmly in place, but the ultimate structure
still needed to be erected. The monetary system was yet to be
concentrated into one central-bank mechanism, and the control
was yet to be taken away from the politicians and placed into
the hands of the bankers themselves.
The
Creature from Jekyll Island
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