Money, money, money... A little about how debt works.

Here, I have taken some quotes from here, and rearranged them into a digestible format that tells a story.

How is "money" made?

Through these quotes, I have here a little about how economics works on the governmental scale. Bear with the first couple of slow, slightly abstract ones--read for a couple minutes and you won't be able to stop until the end.

• It starts off with some basic theory about how money works.
• Then some quotes about how that was interpreted in the early years of the American government to be a perceived possible threat, what it could result in.
• And then some quotes that show what became of their prophecies.

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"The actual process of money creation takes place in commercial banks. As noted earlier, demand liabilities of commercial banks are money.."Confidence in these forms of money also seems to be tied in some way to the fact that assets exist on the books of the government and the banks equal to the amount of money outstanding, even though most of the assets themselves are no more than pieces of paper--.", P.3."Commercial banks create checkbook money whenever they grant a loan, simply by adding new deposit dollars in accounts on their books in exchange for a borrower's IOU.", p. 19. "The 12 regional reserve banks aren't government institutions, but corporations nominally 'owned' by member commercial banks.",
p. 27.- Federal Reserve Bank of Chicago

“The banks do create money. They have been doing it for a long time, but they didn't quite realise it, and they did not admit it. Very few did. You will find it in all sorts of documents, financial textbooks, etc. But in the intervening years, and we must all be perfectly frank about these things, there has been a development of thought, until today I doubt very much whether you would get many prominent bankers to attempt to deny that banks create credit.” — H. W. White, Chairman of the Associated Banks of New Zealand, to the New Zealand Monetary Commission, 1955.

"While economic textbooks claim that people and corporations are competing for markets and resources, I claim that in reality they are competing for money - using markets and resources to do so. Greed and fear of scarcity are being continuously created and amplified as a direct result of the kind of money we are using. For example, we can produce more than enough food to feed everybody, and there is definitely not enough work for everybody in the world, but there is clearly not enough money to pay for it all. In fact, the job of central banks is to create and maintain that currency scarcity. Money is created when banks lend it into existence When a bank provides you with a $100,000 mortgage, it creates only the principal, which you spend and which then circulates in the economy. The bank expects you to pay back $200,000 over the next 20 years, but it doesn't create the second $100,000 - the interest. Instead, the bank sends you out into the tough world to battle against everybody else to bring back the second $100,000."- Bernard Lietaer, Former Central Banker

"Banks lend by creating credit. They create the means of payment, out of nothing." - Ralph M. Hawtery (Former Secretary of the British Treasury)

“The bank hath benefit of interest on all moneys which it creates out of nothing.” — William Paterson, founder of the Bank of England, 1694.

"The modern banking system manufactures money out of nothing. The process is, perhaps, the most, astounding piece of sleight of hand that was ever invented. Banks can in fact inflate, mint, and un-mint the modern ledger-entry currency". Major L. L. B. Angus

"Banking was conceived in iniquity and born in sin. Bankers own the earth; take it away from them but leave them with the power to create credit; and, with a flick of a pen, they will create enough money to buy it back again. Take this power away from them and all great fortunes like mine will disappear, and they ought to disappear, for then this world would be a happier and better world to live in." — Sir Josiah Stamp, Director, Bank of England, 1940

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And so we find...

"If you want to be slaves of bankers and pay the cost of your own slavery, then let the bankers control money and control credit.” — Sir Josiah Stamp, Director, Bank of England, 1940

"The few who understand the system, will either be so interested in its profits, or so dependent on its favors that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantages...will bear its burden without complaint, and perhaps without suspecting that the system is inimical to their best interests." - Rothschild Brothers of London, communiqué to associates in New York June 25, 1863

"Let me issue and control a nation's money and I care not who writes the laws." - Mayer Amschel Rothschild, 1790

What could enable someone to speak this way? What could give someone such confidence?

"Whosoever controls the volume of money in any country is absolute master of all industry and commerce... And when you realise that the entire system is very easily controlled, one way or another, by a few powerful men at the top, you will not have to be told how periods of inflation and depression originate." - James Garfield (assasinated within weeks of release of this statement during first year of his Presidency in 1881)

"If a nation expects to be ignorant and free, it expects what never was and never will be." - Thomas Jefferson

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." - Henry Ford

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Translated into America's economy... What did Jefferson mean by freedom?

"If the American people ever allow private banks to control the issue of their currency, first by inflation then by deflation, the banks and the corporations will grow up around them, will deprive the people of all property until their children wake up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." - Thomas Jefferson, The Debate Over The Recharter Of The Bank Bill, (1809). This prophesy has come true.

"I believe that banking institutions are more dangerous to our liberties than standing armies." - Thomas Jefferson

"I wish it were possible to obtain a single amendment to our constitution - taking from the federal government their power of borrowing." Thomas Jefferson, 1798

"I have two great enemies, the southern army in front of me and the financial institutions, in the rear. Of the two, the one in the rear is the greatest enemy..... I see in the future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. As a result of the war, corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until wealth is aggregated in a few hands and the Republic is destroyed.

I feel at this moment more anxiety for the safety of my country than ever before, even in the midst of the war." - Abraham Lincoln

"The death of Lincoln was a disaster for Christendom. There was no man in the United States great enough to wear his boots and the bankers went anew to grab the riches. I fear that foreign bankers with their craftiness and tortuous tricks will entirely control the exuberant riches of America and use it to systematically corrupt modern civilization." - Otto von Bismarck, German Chancellor (1815-1898), after Lincoln assassination.

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And so what happened? What became of that prediction?

"Federal Reserve is not Federal and it has doubtful reserves. The name is an open deception designed to give this private bank the appearance that it is operating in the public's interest, when in fact it is run solely to gain private profit for its select stock holders. It came into being as the result of one of the slickest moves in financial history. On 23rd December 1913 the house of representatives had past the Federal Reserve Act, but it was still having difficulty getting it out of the senate. Most members of congress had gone home for the holidays, but unfortunately the senate had not adjourned sene die (without day) so they were technically still in session. There were only three members still present. On a unanimous consent voice vote the 1913 Federal Reserve Act was passed. No objection was made, possibly because there was no one there to object."

from Who owns the FED

''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"

- Woodrow Wilson, 28th US President (Just before he died, Wilson is reported to have stated to friends that he had been "deceived" and that "I have betrayed my Country". He referred to the Federal Reserve Act passed during his Presidency.)

"This Act (the Federal Reserve Act, Dec. 23rd 1913) establishes the most gigantic trust on earth. When the President (Woodrow Wilson) signs the Bill, the invisible government of the Monetary Power will be legalised... The worst legislative crime of the ages is perpetrated by this banking and currency Bill." - Charles A. Lindbergh, Sr (1859 - 1924) Congressman (father of the famous aviator)

"The real truth of the matter is, as you and I know, that a financial element in the large centers has owned the government of the U.S. since the days of Andrew Jackson." - Franklin D Roosevelt, 32nd US President

"I have never seen more senators express discontent with their jobs. ... I think the major cause is that, deep down in our hearts, we have been accomplices to doing something terrible and unforgivable to this wonderful country. Deep down in our hearts, we know that we have bankrupted America and that we have given our children a legacy of bankruptcy. .. We have defrauded our country to get ourselves elected." -John Danforth, Republican senator from Missouri, reported in the Arizona Republic of April 21, 1992

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Other odds and ends:


"In addition to almost unlimited usury, the bankers have another method of drawing vast amounts of wealth. The banks are able to approve or disapprove large loans to large and successful corporations to the extent that refusal of a loan will bring about a reduction in the selling price of the corporation's stock. After depressing the price, the bankers' agents buy large blocks of the company's stock. Then, if the bank suddenly approves a multi-million dollar loan to the company, the stock rises and is then sold for a profit. In this manner, billions of dollars are made with which to buy more stock. This practice is so refined today that the Federal Reserve Board need only announce to the newspapers an increase or decrease in their "discount rate" to send stocks soaring or crashing at their whim. Banks collect billions in interest by loaning to Government and the Corporations!" - Pastor Sheldon Emry
Instances of shrinking money supply with adoption of gold and rejection of silver standard:

"I went to America in the winter of 1872-73, authorised to secure, if I could, the passage of a bill demonetising silver. It was in the interest of those I represented - the governors of the Bank of England - to have it done. By 1873, gold coins were the only form of coin money." -
Ernest Seyd, agent of Bank of England.

"There does exist and has existed for a generation, an international Anglophile network which operates, to some extent, in the way the radical Right believes the Communists act. In fact, 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. I know of the operations of this network because I have studied it for 20 years and was permitted for two years, in the early 1960s, to examine its papers and secret record." - Carroll Quigley, Georgetown University professor (deceased), in Tragedy and Hope: A History of the World in Our Time, 1966, p.950

"Money is a new form of slavery, and distinguishable from the old simply by the fact that it is impersonal — that there is no human relation between master and slave." - Leo Tolstoy

"The division of the United States into federations of equal force was decided long before the Civil War by the high financial powers of Europe. These bankers were afraid that the US, if they remained as one block, and as one nation, would attain economic and financial independence, which would upset their financial domination over the world." - Otto von Bismark, Chancellor of Germany 1876

Criticism of the Federal Reserve

(The answer?)