Bankers Love War Because It Creates Massive Profits

War Makes Banks Rich

Bankers are often the driving force behind war.

After all, the banking system is founded upon the counter-intuitive but indisputable fact that banks create loans first, and then create deposits later.

In other words, virtually all money is actually created as debt. For example, in a hearing held on September 30, 1941 in the House Committee on Banking and Currency, the Chairman of the Federal Reserve (Mariner S. Eccles) said:

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

And Robert H. Hemphill, Credit Manager of the Federal Reserve Bank of Atlanta, said:

If all the bank loans were paid, no one could have a bank deposit, and there would not be a dollar of coin or currency in circulation. 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.

Debt (from the borrower’s perspective) owed to banks is profit and income from the bank’s perspective. In other words, banks are in the business of creating more debt … i.e. finding more people who want to borrow larger sums.

Debt is so central to our banking system. Indeed, Federal Reserve chairman Greenspan was so worried that the U.S. would pay off it’s debt, that he suggested tax cuts for the wealthy to increase the debt.

What does this have to do with war?

War is the most efficient debt-creation machine. For starters, wars are very expensive.

For example, Nobel prize winning economist Joseph Stiglitz estimated in 2008 that the Iraq war could cost America up to $5 trillion dollars. A study by Brown University’s Watson Institute for International Studies says the Iraq war costs could exceed $6 trillion, when interest payments to the banks are taken into account.

This is nothing new … but has been going on for thousands of years. As a Cambridge University Press treatise on ancient Athens notes:

Financing wars is expensive business, and the scope for initiative was regularly extended by borrowing.

So wars have been a huge – and regular – way for banks to create debt for kings and presidents who want to try to expand their empires.

Major General Smedley Butler – the most decorated Marine in American history – was right when he said:

Let us not forget the bankers who financed the great war. If anyone had the cream of the profits it was the bankers.

War is also good for banks because a lot of material, equipment, buildings and infrastructure get destroyed in war. So countries go into massive debt to finance war, and then borrow a ton more to rebuild.

The advent of central banks hasn’t changed this formula. Specifically, the big banks (“primary dealers”) loan money to the Fed, and charge interest for the loan.

So when a nation like the U.S. gets into a war, the Fed pumps out money for the war effort based upon loans from the primary dealers, who make a killing in interest payments from the Fed.

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  • mmckinl

    Yep …

  • This is why the banks hate Bitcoin. Bitcoin is THE SOLUTION to all of this, and it just so happens to put all the banks and the Federal Reserve out of business. That is why they will fight Bitcoin tooth and nail, but ultimately, they will be unable to stop Bitcoin.

    • Franco Stalls

      False, Banks love Bitcoin. A fully digital currency – something they’ve wanted for a long time.
      Familiar with JP Morgan? Tooth and nail your goofy smirk, read up on it. (Dumbest comment I’ve read today, congratulations)

    • Name

      Bitcoin is genius, in a way. Not only does it push labor costs onto customers, a la bank ATMs, it also pushes out overhead costs and expenses onto suckers, via mining for a nebulous and low-probability reward. If Bitcoin is the future of currency, I opt out.

      • thermightybalzac

        Bitcoin is not money. It is a speculation. Money needs some time value or it is not money. One cannot plan purchases on a gyrating currency.

    • ahuxley

      Banks don’t hate Bitcoins. The Bitcoin phenomenon is merely the latest morph of all prior forms of currency, and will soon be commandeered, lock, stock and barrel, by the Banking Organized Crime Family.
      There is no getting away from these parasitic bankster vermin…!
      They OWN the SYSTEM…!
      And you and I will always be debt-slaves…

    • greg scott

      Banks hate gold and silver used as money. They aren’t afraid of bitcoin or any other digital money at all. You can’t create gold and silver out of thin air. It take a lot of effort, capital and manpower to find it, mine it, smelt it and refine it into coins. That is why it is honest money.

      • Montecristo

        It is not the work that is key; it is the fact that it cannot arbitrarily wished into someone’s pocket and the fact that gold has objective intrinsic properties (NOT “intrinsic value”) to which individuals can and do impute value. We can each argue with others over how much value the others impute to an ounce of gold but at least we can agree when we have an objective ounce of gold. With the dollar, we have nothing but a meaningless abstraction. Values sadly do get imputed to these abstract dollars, but then the central banks can distort, twist, and upend entire economies by wishing more of them into specific pockets and thus changing what the dollars will purchase and for whom they will purchase things.

        • greg scott

          Gold is rare, durable, fungible, divisible, portable and desired by almost all people and has been throughout human history. Those properties make it the best thing discovered so far to use as money. Bitcoin doesn’t meet all those characteristics near as well and thus is an inferior choice as money.

  • Man on the street

    Someone needs to tell the evangelicals, and the Fox new conservatives that wars increases our children debts by trillions of dollars? The war monger Rush Limbaugh listeners complain about welfare and waste in government that typically does not exceed one trillion dollars, but they are happy spending 6 trillion dollars to unseat Saddam?

    The reality is the hillbillies war mongers NEVER been told that they must spend 6 freaking trillion because the mousatched DICTATOR may have had chemical weapons? They get sold on hubris, “patriotic” BS? Let us go and kick a$$? No one said how much that will cost us.

    Now after the news is out, do you suppose the ignorant evangelicals that supported Bush and the war on Iraq would ever say IF I KNOW IT WAS GOING TO COST US 6 trillion dollars, I would never have supported that war! Or, they sold me on this by saying we are going to pay for the war with Saddam’s oil? And after we spent trillions on that hell hole, they a worded the oil contracts to the Chinese? What a banana republic. The Feds push loans on us to do wars, and they get rich, and our kids get killed. That is a good deal.

    • Iraq: the success of Russian oilmen

      “Everything is relative and we can compare what the USA did to our country with what Russia is doing now,” wrote the Iraqi newspaper al-Furat. “America, this bastion of democracy, completely destroyed Iraqi statehood, annihilated its infrastructure and industry and is now attempting to interfere in the affairs of a sovereign state. Russia, by way of contrast, is attempting to help us emerge from the difficult condition which we were driven into by America. The commencement of work at the ‘West Qurna Phase II’ oilfield is a striking example of this. This operation will create new jobs, reduce unemployment, and the revenues from the exploitation of the oilfield will, we hope, be directed towards the revival of our industry and the creation of new infrastructure.”

      • Joseph Miller

        We should have been doing that… rebuilding and taking control… through commerce.

    • Tim Bell

      I believe you are angry at the wrong people. Do not be mad at our govt. Be mad at the world banks.

      • Man on the street

        Our government appoints the world bank leaders. But, you are correct that the money changers have been the source of evil on this planet since the invention of fractional lending.

      • Sally McWoozy

        I see where you’re coming from but the governments (not just one) facilitate the behaviour of the banks … or let them get away with it because they have us over a barrel it would be messy to get out of!

    • Sally McWoozy

      …and of course you now know there were no chemical weapons and the government knew there were no chemical weapons; the only reason we went to war with Iraq was to harvest their resources. People mean nothing to them, they never did and they never will, after all, their kids won’t go to war. Libya is another one, citizens are now worse off than they were with Colonel Gadaffi in charge …

  • Mark Williford

    MAN ON THE STREET-Brilliant!! You see there is not a dime bit of difference between the Democrats or Republicans–the end result is PERPETUAL INDEBTEDNESS. Republicans want big Armies but less social spending-but what’s the end result?? DEBT! The Democrats and Socialists want less spending on our military but excessive spending on social giveaways-but what is the end result? Even More debt? Both Parties clamor for one thing and one thing only-DEBT! Go read Gary Allen’s 1971 best selling book, “NONE DARE CALL IT CONSPIRACY”.You should really read former Georgetown professor, Dr. Caroll Quigley’s book, Tragedy and Hope” Quigley, whose students included Bill Clinton and George Casey explains that perpetual indebtedness of a government is the goal of the international banking system. Wars, bizarre social programs, and continuos give-aways do one thing and one thing only-Keep governments in debt. In fact, Socialism is really about perpetual indebtedness. As governments spend more how do they get the money to do so? Since 1689 (when the Bank of England was formed) a group of private central bankers learned quickly that lending money to the crown for wars and social giveaways was the best route for riches. Our Federal Reserve Bank practices the same technique. As Jefferson once said, “Central Banks are more dangerous than a standing Army.” Napoleon, Jefferson, Jackson, Lincoln and JFK warned of the dangers of a central banking system.

    • Tecumseh1768

      The republicans and democrats are able to come to a win-win solution, more welfare and wars.

    • Joseph Miller

      Finally someone that understands what is going on!!! Well said, Mark Williford!

      • Man on the street

        To Joseph and Mark; you both know the story clearly, but unfortunately very few of us have such clear understanding. It is our duty to spread the word among our friends. The first thing we must eliminate the word “conspiracy theory” as a bad thing. Conspiracies happening everyday any group agree not to tell others something. To acknowledge that there is a conspiracy is to assert that you are not going to be fooled or intimidated.

  • War also accomplishes another task they seek. The death of earths inhabitants. Their stated goal is a global population of 500M people. Through war we also see the consolidation of power. WWI and WWII both ended with the founding of world government entities. The League of Nations and the United Nations.

  • lawrencebaker

    What Washington/banksters hate about Iran is that Iran is a religious
    Muslim nation and therefore Sharia banking is subject to Sharia
    Muslim law.

    Your Sharia banker follows strict non-usury banking laws and prays to his
    God to pay interest and not to be tempted to steal your money.

    The western multinational Banking/Big Oil/Military Complex conglomerate
    hate competition. If I had to choose between a Sharia bank and a
    criminal bank, I would choose to deposit my money with the honest

    Do not believe the conglomerate war hate propaganda against Muslim
    (Sharia banking).

  • FredKapelski

    There is ample evidence of Sadam’s inventory of weapons. We gave them to him. As I recall, most were expended on his long war with Iran, and the rest on the Kurds. Just history. GW was a Christian in name only, which I always thought was obvious to casual observation. It got me into trouble with guys at the men’s prayer breakfast who thought critical thinking had to do with sports analysis or why they were upset with their wives. I got into a bit more, when I said the Patriot Act laid the ground for the end of the Republic of the United States. That is all history now too. Yet, we are still in Afghanistan, Christians take little notice, much less care. The cost in life is immaterial and the financial costs is completely lost on them. Too many are watching snake charmers weave back and forth and talk about the “prosperity teaching” which is poorly masked witchcraft. What will it take to wake people out of their slumber? What will it take to get zombie Christians faces & minds out of their “smart phones” that are enslaving them? The cure probably won’t be pretty when it comes.

    • Man on the street

      If Christian people don’t start thinking like US AGAINST THEM, they will be lunch to the vultures of other 2 organized Abrahamic religions.

  • greg scott

    War is the lifeblood of the state. And the state is mostly owned by the bankers. As long as we keep using fiat money nothing will change that reality.

    • Jessica

      What should we do instead of using flat money?

      • greg scott

        Return to using gold and silver as money. History has proven over and over how effective they are in limiting the power of the state. Fiat money is slave money.

  • Loki Luck III

    Just the facts… nothing else.

  • jennyharisson14

    Debt will always in every country ,but we can avoid just to think first ,then ask the experts for advices.

  • Jessica

    Does Credit Unions support the war?

  • Tree

    “It is no coincidence that the century of total war coincided with the century of central banking.”- Ron Paul.