The History of the Financial Crisis

Here are a few quotes which may explain at least part of what’s going on financially:

“Whoever controls the volume of money in any country is absolute master of all industry and commerce… And when you realize 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.”
- President James Garfield (he was assassinated within 4 months).

“If the people only understood the rank injustice of our Money and Banking system, there would be a revolution before morning.”
- Andrew Jackson

“[Banks] do not really pay out loans from the money they receive as deposits. If they did this, no additional money would be created. What they do when they make loans is to accept promissory notes in exchange for credits to the borrowers’ transaction accounts.”
- 1960s Chicago Federal Reserve Bank booklet entitled “Modern Money Mechanics”

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. Banking was conceived in inequity and born in sin . . . . Bankers own the earth. Take it away from them but leave them the power to create money, and, with a flick of a pen, they will create enough money to buy it back again. . . . Take this great power away from them and all great fortunes like mine will disappear, for then this would be a better and happier world to live in. . . . But, if you want to continue to be the slaves of bankers and pay the cost of your own slavery, then let bankers continue to create money and control credit.”
- Sir Josiah Stamp, president of the Bank of England and the second richest man in Britain in the 1920s.

Banks create money. That is what they are for. . . . The manufacturing process to make money consists of making an entry in a book. That is all. . . . Each and every time a Bank makes a loan . . . new Bank credit is created — brand new money.
- Graham Towers, Governor of the Bank of Canada from 1935 to 1955

“Henry Ford thinks its stupid and so do I, that for the loan of its own money the United States should be compelled to pay . . . interest. Why must we pay interest to money-brokers for the use of our own money!”
- Thomas Edison.

[W]hen a bank makes a loan, it simply adds to the borrower’s deposit account in the bank by the amount of the loan. The money is not taken from anyone else’s deposit; it was not previously paid in to the bank by anyone. It’s new money, created by the bank for the use of the borrower.
- Robert B. Anderson, Secretary of the Treasury under Eisenhower, in an interview reported in the August 31, 1959 issue of U.S. News and World Report

“You do not have too many workers, you have too little money in circulation, and that which circulates, all bears the endless burden of unrepayable debt and usury…[the Colonial Scrip was issued] with our money [with no interest owed to anyone.]”
- Benjamin Franklin, explaining to the British parliament why the American colonies were prosperous while Britain experienced rampant unemployment and poverty.

“[It was] the poverty caused by the bad influence of the English bankers on the Parliament which has caused in the colonies hatred of the English and . . . the Revolutionary War.”
- Benjamin Franklin

“There are two ways to conquer and enslave a nation. One is by the sword. The other is by debt.”
- John Adams

“The real rulers in Washington are invisible, and exercise power from behind the scenes.”
- Supreme Court Justice Felix Frankfurter, 1952

“I believe that banking institutions are more dangerous to our liberties than standing armies…The issuing power should be taken from the banks and restored to the Government, to whom it properly belongs.”
- Thomas Jefferson

“A power has risen up in the government greater than the people themselves, consisting of many and various powerful interests, combined in one mass, and held together by the cohesive power of the vast surplus in banks.”
- John C. Calhoun, Vice President of the United States

“There is an evil which ought to be guarded against in the indefinite accumulation of property from the capacity of holding it in perpetuity by…corporations. The power of all corporations ought to be limited in this respect. The growing wealth acquired by them never fails to be a source of abuses.”
- James Madison

“Some people think the Federal Reserve Banks are US government institutions They are not… they are private credit monopolies which prey upon the people of the US. for the benefit of themselves and their foreign and domestic swindlers, and rich and predatory money lenders. The sack of the United States by the Fed is the greatest crime in history. Every effort has been made by the Fed to conceal its powers, but the truth is the Fed has usurped the government. It controls everything here and it controls all our foreign relations. It makes and breaks governments at will”.
-Congressman Charles McFadden, Chairman, House Banking and Currency Committee, June 10, 1932

“The Federal Reserve Bank of New York is eager to enter into close relationship with the Bank for International Settlements….The conclusion is impossible to escape that the State and Treasury Departments are willing to pool the banking system of Europe and America, setting up a world financial power independent of and above the Government of the United States… The United States under present conditions will be transformed from the most active of manufacturing nations into a consuming and importing nation with a balance of trade against it.”
- Congressman McFadden, quoted in the New York Times (June 1930)

“The real truth of the matter is that a financial element in the large centers has owned the government since the days of Andrew Jackson.”
- Franklin D Roosevelt

“This is a staggering thought. We are completely dependent on the commercial Banks. Someone has to borrow every dollar we have in circulation, cash or credit. If the Banks create ample synthetic money we are prosperous; if not, we starve. We are absolutely without a permanent money system. When one gets a complete grasp of the picture, the tragic absurdity of our hopeless position is almost incredible, but there it is. It is the most important subject intelligent persons can investigate and reflect upon. It is so important that our present civilization may collapse unless it becomes widely understood and the defects remedied very soon.”
-Robert Hemphill, Credit manager of Federal Reserve Bank in Atlanta.

“The Founding Fathers of this great land had no difficulty whatsoever understanding the agenda of bankers, and they frequently referred to them and their kind as, quote, ‘friends of paper money. They hated the Bank of England, in particular, and felt that even were we successful in winning our independence from England and King George, we could never truly be a nation of freemen, unless we had an honest money system. Through ignorance, but moreover, because of apathy, a small, but wealthy, clique of power brokers have robbed us of our Rights and Liberties, and we are being raped of our wealth. We are paying the price for the near-comatose levels of complacency by our parents, and only God knows what might become of our children, should we not work diligently to shake this country from its slumber! Many a nation has lost its freedom at the end of a gun barrel, but here in America, we just decided to hand it over voluntarily. Worse yet, we paid for the tyranny and usurpation out of our own pockets with “voluntary” tax contributions and the use of a debt-laden fiat currency!”.
-Peter Kershaw, author of the 1994 booklet “Economic Solutions”

“I have never seen more Senators express discontent with their jobs … we have been accomplices to doing something terrible and unforgivable to this wonderful country… we have given our children a legacy of bankruptcy. We have defrauded our country to get ourselves elected”.
-John Danforth, Republican Senator from Missouri, in an interview in The Arizona Republic on April 22, 1992

These statements were made during hearings of the House Committee on Banking and Currency, September 30, 1941.

Members of the Federal Reserve Board call themselves “Governors”. Governor Eccles was Chairman of the Federal Reserve Board at the time of these hearings.

Congressman Patman: “How did you get the money to buy those two billion dollars worth of Government securities in 1933?”

Governor Eccles: “Out of the right to issue credit money.”

Patman: “And there is nothing behind it, is there, except our Government’s credit?”

Eccles: “That is what our money system is. If there were no debts in our money system, there wouldn’t be any money.”

Congressman Fletcher: “Chairman Eccles, when do you think there is a possibility of returning to a free and open market, instead of this pegged and artificially controlled financial market we now have?”

Governor Eccles: “Never, not in your lifetime or mine.”

“The privileged princes of these new economic dynasties, thirsting for power, reached out for control over government itself. They created a new despotism and wrapped it in the robes of legal sanction. …And as a result the average man once more confronts the problem that faced the Minute Man….
- Franklin Roosevelt

“I care not what puppet (sits on) the throne of England to rule the Empire on which the sun never sets. The man who controls Britain’s money supply controls the British empire, and I (when he ran the Bank of England) control the British money supply.”
- Nathan Rothschild

Caveat: Most – but not all – of the quotes have been verified as historically accurate. For background on many of the quotes, see this.

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  • http://randommarginalthoughts.blogspot.com/ Libertarian Thinker

    Excellent list. I'd like to add one more: «When a country which has contracted a debt is unable, on account of the slenderness of its income, to offer sufficient guarantee for the punctual payment of interest, what happens ? Sometimes an out-and-out conquest of the debtor country follows. Thus France's attempted conquest of Mexico during the second empire was undertaken solely with the view of guaranteeing the interest of French citizens holding Mexican securities. But more frequently the insufficient guarantee of an international loan gives rise to the appointment of a financial commission by the creditor countries in order to protect their rights and guard the fate of their invested capital. The appointment of such a commission literally amounts in the end, however, to a veritable conquest. We have examples of this in Egypt, which has to all practical purposes become a British province, and in Tunis, which has in little manner become a dependency of France, who supplied the greater part of the loan. The Egyptian revolt against the foreign domination issuing from the debt came to nothing, as it met with invariable opposition from capitalistic combinations, and Tel-el-Kebir's success bought with money, was the most brilliant victory wealth has ever obtained on the field of battle.» (An Italian political economics Loria more than 100 years ago)

  • http://Anonymousnoreply@blogger.com Anonymous

    And then, suddenly, nobody important (powerful) spoke out.. I wonder why?

  • http://newstheylose.wordpress.com/ newstheylose

    Excellent stuff, I will be uding it in my blo, and of course referencing you…

  • http://www.blogger.com/profile/10002267385228111639 Laura Lee

    These are really good reasons not to have wars with large number of people at the bottom of the pyramid. Really, the battle is with the ppl at the top.

  • http://www.blogger.com/profile/10002267385228111639 Laura Lee

    PS… people in my friends group are passing around your blogs I post. it's a good blog.

  • http://classlink.lcusd.net/classlink/viewfiles.php?pid=4096 Carl Herman

    I teach Macroeconomics and work with Ellen Brown among others for monetary reform. For a 1-page summary and 6-page summary of our monetary system (with 14 pages of the best sourced quotes I've found): http://classlink.lcusd.net/classlink/viewfiles.php?pid=4096 . The longer brief is titled Heart of Economics.

  • http://www.blogger.com/profile/00545078524977542706 tritisan

    @Carl: Wow, I really wish I would have had a teacher like this in HS. I never really "got" macroeconomics. Now I know why: Everything we're taught is almost complete BS.

 

 

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