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What's going on in America today?

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Why are we over our heads in debt?

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Why can't the politicians bring debt under control?

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Why are so many people - often both parents now

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working at low-paying, dead-end jobs and still making do with less?

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What's the future of the American economy and way of life?

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Why does the government tell us inflation is low when the buying power of our paychecks

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is declining at an alarming rate?

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Only a generation ago, bread was a quarter and you could get a new car for $1,995!

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The problem is that since 1864 we’ve had a debt-based banking system.

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All our money is based on government debt.

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We cannot extinguish government debt without extinguishing our money supply.

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That’s why talk of paying off the national debt,

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without reforming our banking system, is an impossibility.

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That’s why the solution does not lie in discussing the size of national debt

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rather than lies in reforming our banking system.

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This is the Federal Reserve headquarters in Washington, D.C.

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It sits on a very impressive address

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right on Constitution Avenue, right across from the Lincoln Memorial.

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But is it "Federal"?

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Is it really part of the United States government?

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Well, what we are about to show you

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is that there is nothing federal about the Fed Reserve,

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and there are no reserves.

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The name is a deception

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created back before the Fed Reserve Act was passed in 1913

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to make Americans think that America's new central bank

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operates in the public interest.

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The truth is that the Fed is a private bank,

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owned by private stockholders,

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and run purely for their private profit.

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"That's exactly correct,

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the Fed is privately-owned, for-profit corporation which has no reserves,

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at least no reserve to back up the Federal Reserve notes

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which are our common currency.

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Well, absolutely. The Fed is neither federal and has doubtful reserves.

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It’ a private bank that is owned by member banks

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and it was chartered under the guys of the seat by an act of congress in 1913.

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If there's still any doubt whether the Federal Reserve is a part of the U.S. government,

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check your local telephone book.

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In most cities, it's not listed in the blue "government pages."

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It is listed in the "business" white pages,

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right next to Federal Express, another private company.

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But more directly, U.S. Courts have ruled time and time again

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that the Fed is a private corporation.

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Why can't Congress do something about the Fed?

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Most members of Congress just don't understand the system,

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and the few who do are afraid to speak up.

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For example, initially a veteran Congressman from Chicago

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asked us if he could be interviewed for this video.

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However, both times our camera crew arrived at his office to do the interview,

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this was all we were able to film.

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The Congressman never appeared,

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and eventually he decided he no longer wanted to participate.

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But a few others in Congress have been bolder over the years.

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Here are three quick examples.

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In 1923, Representative Charles A. Lindbergh, a Republican from Minnesota,

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the father of famed aviator, "Lucky" Lindy, put it this way:

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One of the most outspoken critics in Congress of the Fed

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was the former Chairman of the House Banking and Currency Committee

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during the Great Depression years, Louis T. McFadden said in 1932:

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Senator Barry Goldwater was a frequent critic of the Fed:

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"The Fed really, even though it’s not part of the federal government,

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is more powerful than the federal government.

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It is more powerful than the President, Congress or the courts.

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A lot of people challenges me on that. Let me prove my case.

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The Fed determines what the average person's car payment is going to be

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what their house payment is going to be

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and whether they have a job or not.

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And I submit to you - that is total control.

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The Fed is the largest single creditor of the U.S. government.

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What does Proverbs tell us? The borrower is servant to the lender.

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What one has to understand is that, from the day the Constitution was adopted,

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the folks who profit from privately owned central banks,

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as President Madison called them, the "Money Changers",

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have fought a running battle for control over who gets to print America's money.

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Why is who prints the money so important?

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Think of money as just another commodity.

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If you have a monopoly on a commodity that everyone needs, everyone wants,

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and nobody has enough of, there are lots of ways to make a profit

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and also exert tremendous political influence.

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That's what this battle is all about.

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Throughout the history of the United States,

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the money power has gone back and forth between Congress

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and some sort of privately-owned central bank.

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The founding fathers knew the evils of a privately-owned central bank.

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First of all, they had seen how the privately owned British central bank,

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the Bank of England, had run up the British national debt

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to such an extent that Parliament had been forced

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to place unfair taxes on the American colonies.

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In fact, as we'll see later, Ben Franklin claimed

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that this was the real cause of the American Revolution.

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Most of the founding fathers realized the potential dangers of banking,

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and feared bankers' accumulation of wealth and power.

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Jefferson put it this way:

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That succinct statement of Jefferson is, in fact,

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the solution to all our economic problems today.

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It helps repeating: the issuing power should be taken from the banks

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and restored to the people to whom it properly belongs.

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James Madison, the main author of the Constitution, agreed.

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Interestingly, he called those behind the central bank scheme "Money Changers".

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Madison strongly criticized their actions:

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The battle over who gets to issue our money

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has been the pivotal issue through the history of the United States.

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Wars are fought over it.

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Depressions are caused to acquire it.

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Yet after World War I, this battle was rarely mentioned

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in newspapers or history books.

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Why?

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By World War I, the Money Changers with their dominant wealth,

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had seized control of most of the nation's press.

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Throughout U.S. history,

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the battle over who gets the power to issue our money has raged.

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In fact it has changed hands back and forth eight times since 1764.

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Yet, this fact has virtually vanished from public view for over three generations

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behind a smoke screen emitted by Fed cheerleaders in the media.

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Until we stop talking about "deficits" and "government spending"

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and start talking about who controls how much money we have,

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it's just a shell game - a complete and utter deception.

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It won't matter if we pass an iron-clad amendment to the Constitution

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mandating a balanced budget.

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Our situation is only going to get worse until we root out the cause at its source.

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What’s the solution for our national problem?

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First of all, education.

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This is what this presentation is all about.

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But secondly, we must act,

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we must take back the power to issue our own money.

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Issuing our own money is not a radical solution.

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It's the same solution proposed at different points in U.S. history

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by men like Benjamin Franklin, Thomas Jefferson, Andrew Jackson,

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Martin Van Buren, Abraham Lincoln

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So, to sum it up: in 1913, Congress gave an independent central bank,

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deceptively named the Federal Reserve,

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a monopoly over issuing America's money,

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and the debt generated by this quasi-private corporation

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is what is killing the American economy.

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Though the Federal Reserve is now one of the two

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most powerful central banks in the world, it was not the first.

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So where did this idea come from?

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To really understand the magnitude of the problem,

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we have to travel back to Europe.

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Just who are these "Money Changers" James Madison spoke of?

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The Bible tells us that two thousand years ago,

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Jesus Christ drove the Money Changers from the Temple.

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It was the only times Jesus used force during his ministry.

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What were Money Changers doing in the Temple?

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When Jews came to Jerusalem to pay their Temple tax,

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they could only pay it with a special coin, the half shekel of the sanctuary.

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This was a half-ounce of pure silver, about the size of a quarter.

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It was the only coin around at that time

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which was pure silver and of assured weight,

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without the image of a pagan Emperor.

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Therefore, to Jews the half-shekel was the only coin acceptable to God.

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But these coins were not plentiful.

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The Money Changers had cornered the market on them.

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Then, they raised the price of them - just like any other commodity

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to whatever market would bear.

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In other words, the Money Changers were making

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exorbitant profits because they held a virtual monopoly on money.

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The Jews had to pay whatever they demanded.

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To Jesus, this totally violated the sanctity of God's house.

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But the money changing scam did not originate in Jesus' day.

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Two hundred years before Christ,

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Rome was having trouble with Money Changers.

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Two early Roman emperors had tried to diminish the power of the Money Changers

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by reforming usury laws and limiting land ownership to 500 acres.

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They both were assassinated.

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In 48 B.C., Julius Caesar took back the power to coin money from the Money Changers

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and minted coins for the benefit of all.

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With this new, plentiful supply of money,

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he built great public works projects.

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By making money plentiful, Caesar won the love of common man.

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But the Money Changers hated him.

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Some believe this was an important factor in Caesar's assassination.

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One thing is for sure: with the death of Caesar

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came the demise of plentiful money in Rome.

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Taxes increased, as did corruption.

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Just as in the case of America today, usury and debased coin became the rule.

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Eventually, the Roman money supply was reduced by 90%.

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As a result, the common people lost their lands and homes

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just as is about to happen soon in America.

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With the demise of plentiful money,

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the masses lost confidence in Roman government and refused to support it.

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Rome plunged into the gloom of the Dark Ages.

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A thousand years after the death of Christ,

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Money Changers - those who exchange, create and manipulate the quantity of money

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were active in medieval England.

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In fact, they were so active that acting together

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they could manipulate the English economy.

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These were not bankers, per se.

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The Money Changers generally were the goldsmiths.

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They were the first bankers because they started

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keeping other people's gold for safekeeping in their vaults.

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The first paper money in Western Europe

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was merely receipts for gold left at the goldsmiths.

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Paper money caught on because it was more convenient and safer

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than carrying around a lot of heavy gold and silver coins.

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Eventually goldsmiths noticed that only a small fraction of the depositors

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ever came in and demanded their gold at any one time.

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Goldsmiths started cheating on the system.

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They discovered that they could print more money than they had gold

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and usually no one would be the wiser.

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Then, they could loan out this extra paper money and collect interest on it.

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This was the birth of fractional reserve lending that is,

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loaning out many times more money than you have assets on deposit.

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So, for example, if $1,000 in gold were deposited with them,

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they could loan out about $10,000 in paper money and charge interest on it,

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and no one would discover the deception.

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By this means, goldsmiths gradually accumulated more and more wealth

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and used this wealth to accumulate more and more gold.

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Today, this practice of loaning out more money than there are reserves

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is known as fractional reserve banking.

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Every bank in the U.S. is allowed to loan out at least

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ten times more money they actually have.

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That's why they get rich on charging let's say 8% interest.

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It's not really 8% per year, which is their profit. It's 80%.

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That's why bank buildings are always the largest in town.

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But does that mean that all interest or all banking should be illegal?

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No. In the Middle Ages, Canon law, the law of the Catholic Church,

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forbade charging interest on loans.

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This concept followed the teachings of Aristotle

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as well as of Saint Thomas Aquinas.

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They taught that the purpose of money was to serve the members of society

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to facilitate the exchange of goods needed to lead a virtuous life

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Interest, in their belief, hindered this purpose

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by putting an unnecessary burden on the use of money.

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In other words, interest was contrary to reason and justice.

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Reflecting Church Law in the Middle Ages,

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Europe forbade charging interest on loans and made it a crime called usury.

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As commerce grew and therefore opportunities for investment

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arose in the late Middle Ages,

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it came to be recognized that to loan money had a cost to the lender

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both in risk and in lost opportunity.

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So, some charges were allowed, but not interest per se.

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But all moralists, no matter what religion, condemn fraud,

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oppression of the poor and injustice as clearly immoral.

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As we will see, fractional reserve lending is rooted in a fraud,

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results in widespread poverty

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00:17:45,681 --> 00:17:48,713
and reduces the value of everyone else's money.

250
00:17:51,509 --> 00:17:55,020
The ancient goldsmiths discovered that extra profits could be made

251
00:17:55,021 --> 00:17:59,030
by "rowing" the economy between easy money and tight money.

252
00:18:00,095 --> 00:18:02,349
When they made money easier to borrow,

253
00:18:02,035 --> 00:18:05,073
then the amount of money in circulation expanded.

254
00:18:05,731 --> 00:18:06,735
Money was plentiful.

255
00:18:07,494 --> 00:18:11,018
People took out more loans to expand their businesses.

256
00:18:11,019 --> 00:18:15,012
But then the money changers would tighten the money supply.

257
00:18:15,013 --> 00:18:18,022
They would make loans more difficult to get.

258
00:18:18,871 --> 00:18:19,886
What would happen?

259
00:18:20,022 --> 00:18:21,091
Just what happens today.

260
00:18:21,859 --> 00:18:25,934
A certain percentage of people could not repay their previous loans,

261
00:18:25,935 --> 00:18:29,030
and could not take out new loans to repay the old ones.

262
00:18:31,047 --> 00:18:35,504
Therefore they went bankrupt, and had to sell their assets to the goldsmiths

263
00:18:35,505 --> 00:18:36,591
for pennies on the dollar.

264
00:18:39,044 --> 00:18:41,841
The same thing is still going on today,

265
00:18:42,406 --> 00:18:42,842
only today we call this rowing of the economy, up and down, the "Business Cycle".

266
00:18:51,078 --> 00:18:54,111
Like Caesar, Henri I of England finally resolved

267
00:18:55,799 --> 00:18:59,805
to take the money power away from the goldsmiths, about 1100 A.D.

268
00:19:01,379 --> 00:19:05,465
Henri could have used anything as money, seashells, feathers, or even ?

269
00:19:06,696 --> 00:19:08,758
as is often done in remote provinces.

270
00:19:10,713 --> 00:19:14,744
But he invented one of the most unusual money systems in history.

271
00:19:15,024 --> 00:19:17,098
It was called the “tally stick” system.

272
00:19:19,219 --> 00:19:24,354
Here I have one of the few surviving examples of this form of British money

273
00:19:24,355 --> 00:19:26,394
which lasted 726 years, until 1826

274
00:19:29,561 --> 00:19:30,565
a tally stick.

275
00:19:30,099 --> 00:19:35,126
This system was adopted to avoid the monetary manipulation of the goldsmiths.

276
00:19:38,377 --> 00:19:42,421
Tally stick were money fabricated out of stick of polished wood.

277
00:19:42,869 --> 00:19:47,883
Notches were cut along one edge of the stick to indicate the denomination.

278
00:19:48,624 --> 00:19:51,632
Then the stick was split lengthwise through the notches

279
00:19:52,767 --> 00:19:55,851
so that both pieces still had a record of the notches.

280
00:19:57,615 --> 00:20:00,704
The king kept one half to protect against counterfeiting.

281
00:20:01,506 --> 00:20:04,532
Then he would “spend” the other halves into the economy

282
00:20:04,767 --> 00:20:06,948
and they would circulate as money.

283
00:20:06,949 --> 00:20:10,964
This particular Tally Stick is huge and represented £25,000.

284
00:20:12,794 --> 00:20:15,541
One of the original stockholders in the Bank of England

285
00:20:15,542 --> 00:20:18,558
purchased his original shares with this stick.

286
00:20:19,733 --> 00:20:22,795
In other words, he bought shares in the world's richest

287
00:20:23,354 --> 00:20:26,416
and most powerful corporation, with a stick of wood.

288
00:20:28,087 --> 00:20:31,101
It's ironic that after its formation in 1694

289
00:20:31,566 --> 00:20:34,767
the Bank of England attacked the Tally Stick system

290
00:20:34,768 --> 00:20:39,126
because it was money issued outside the control of the Money Changers

291
00:20:39,127 --> 00:20:41,211
just as king Henri had wanted it to be.

292
00:20:43,115 --> 00:20:45,978
Why would people accept sticks of wood for money?

293
00:20:45,979 --> 00:20:47,390
That's a great question.

294
00:20:47,391 --> 00:20:49,717
Throughout history, people have traded anything

295
00:20:49,718 --> 00:20:52,430
they thought had value and used that for money.

296
00:20:52,431 --> 00:20:57,477
You see, the secret is that money is only what people agree on to use as money.

297
00:20:57,892 --> 00:20:58,964
What's our paper money today?

298
00:20:59,613 --> 00:21:00,681
It's really just paper.

299
00:21:01,531 --> 00:21:04,976
But here's the trick: King Henry ordered that Tally Sticks

300
00:21:04,977 --> 00:21:07,061
had to be used to pay the king’s taxes.

301
00:21:08,011 --> 00:21:10,038
This built in demand for tallies

302
00:21:10,726 --> 00:21:14,747
and immediately made them circulate and be accepted as money.

303
00:21:16,005 --> 00:21:17,246
And they worked well.

304
00:21:17,247 --> 00:21:22,253
In fact, no other money worked so well and for so long as tally sticks.

305
00:21:23,705 --> 00:21:28,707
Keep in mind: the British empire was built under the tally stick system.

306
00:21:29,000 --> 00:21:32,039
The tally stick system succeeded despite the fact

307
00:21:32,807 --> 00:21:35,823
that the money changers constantly attacked it

308
00:21:36,000 --> 00:21:39,039
by offering the metal coin system as competition.

309
00:21:39,859 --> 00:21:43,927
In other words, metal coins never went completely out of circulation

310
00:21:44,953 --> 00:21:49,960
but tally stick hung on because they were good for the payment of taxes.

311
00:21:52,149 --> 00:21:53,745
Finally, in the 1500's,

312
00:21:53,746 --> 00:21:56,785
King Henry VIII relaxed the laws concerning usury

313
00:21:57,713 --> 00:22:01,807
and the Money Changers wasted no time reasserting themselves.

314
00:22:01,808 --> 00:22:05,869
They made their gold and silver money plentiful for a few decades.

315
00:22:07,017 --> 00:22:11,402
But when Queen Mary took the throne and tightened the usury laws again

316
00:22:11,403 --> 00:22:15,447
the Money Changers renewed the hoarding of gold and silver coin,

317
00:22:16,002 --> 00:22:18,018
forcing the economy to plummet.

318
00:22:19,295 --> 00:22:22,740
When Mary's half-sister, Queen Elizabeth I, took the throne

319
00:22:22,741 --> 00:22:25,827
she was determined to regain control over English money.

320
00:22:26,958 --> 00:22:31,585
Her solution was to issue gold and silver coins from the public treasury

321
00:22:31,586 --> 00:22:36,629
and thus take the control over the money supply, away from the Money Changers.

322
00:22:37,138 --> 00:22:42,905
Although control over money was not the only cause of the English Revolution in 1642

323
00:22:42,906 --> 00:22:45,954
- religious differences fuelled the conflict –

324
00:22:45,955 --> 00:22:48,006
monetary policy played a major role.

325
00:22:50,051 --> 00:22:51,779
Financed by the Money Changers

326
00:22:51,078 --> 00:22:54,089
Oliver Cromwell finally overthrew King Charles

327
00:22:55,077 --> 00:22:58,092
purged Parliament, and put the King to death.

328
00:22:59,043 --> 00:23:04,080
The Money Changers were immediately allowed to consolidate their financial power.

329
00:23:04,468 --> 00:23:07,530
The result was that for the next fifty years

330
00:23:07,531 --> 00:23:11,616
the Money Changers plunged Great Britain into a series of costly wars.

331
00:23:12,893 --> 00:23:16,128
They took over a square mile of property in the centre of London

332
00:23:16,129 --> 00:23:17,162
known as The City.

333
00:23:18,777 --> 00:23:20,792
This area today is still known

334
00:23:21,219 --> 00:23:25,257
as one of the three predominant financial centres of the world.

335
00:23:27,262 --> 00:23:31,193
Conflicts with the Stuart kings led the Money Changers in England

336
00:23:31,194 --> 00:23:33,385
to combine with those in the Netherlands

337
00:23:33,386 --> 00:23:36,360
to finance the invasion of William of Orange

338
00:23:36,361 --> 00:23:40,393
who overthrew the Stuarts in 1688 and took the English throne.

339
00:23:46,755 --> 00:23:49,764
By the end of the 1600s, England was in financial ruin.

340
00:23:51,088 --> 00:23:56,184
Fifty years of more or less continuous wars with France and Holland had exhausted her.

341
00:23:57,308 --> 00:24:00,116
Frantic government officials met with the Money Changers

342
00:24:00,117 --> 00:24:04,173
to beg for the loans necessary to pursue their political purposes.

343
00:24:04,863 --> 00:24:05,902
The price was high:

344
00:24:06,619 --> 00:24:08,717
a government-sanctioned, privately-owned bank

345
00:24:09,006 --> 00:24:12,033
which could issue money created out of nothing.

346
00:24:14,442 --> 00:24:18,514
It was to be the modern world's first privately owned, central bank

347
00:24:19,262 --> 00:24:20,307
the Bank of England.

348
00:24:21,109 --> 00:24:24,168
Although it was deceptively called the Bank of England

349
00:24:24,169 --> 00:24:27,786
to make the population think it was part of the government

350
00:24:27,787 --> 00:24:27,873
it was not.

351
00:24:29,425 --> 00:24:31,331
Like any other private corporation

352
00:24:31,332 --> 00:24:34,364
the Bank of England sold shares to get started.

353
00:24:35,231 --> 00:24:37,325
The investors, whose names were never revealed,

354
00:24:38,172 --> 00:24:42,214
were supposed to put up one and a quarter million in gold coin

355
00:24:43,613 --> 00:24:45,645
to buy their shares in the Bank.

356
00:24:46,327 --> 00:24:49,330
But only £750,000 pounds was ever received.

357
00:24:50,595 --> 00:24:54,597
Despite that, the Bank of England was duly chartered in 1694

358
00:24:55,292 --> 00:24:58,349
and started out in the business of loaning out several times

359
00:24:58,863 --> 00:25:01,960
the money it supposedly had in reserves, all at interest.

360
00:25:04,417 --> 00:25:07,583
In exchange, the new bank would loan British politicians

361
00:25:07,584 --> 00:25:08,646
as much as they wanted

362
00:25:09,809 --> 00:25:14,828
as long as they secured the debt by direct taxation of the British people.

363
00:25:15,529 --> 00:25:19,767
So, legalization of the Bank of England amounted to nothing less

364
00:25:19,768 --> 00:25:23,819
than legal counterfeiting of a national currency for private gain.

365
00:25:24,631 --> 00:25:26,689
Unfortunately, nearly every nation now

366
00:25:27,374 --> 00:25:29,443
has a privately controlled central bank

367
00:25:30,203 --> 00:25:33,205
using the Bank of England as the basic model.

368
00:25:34,802 --> 00:25:36,898
Such is the power of these central banks

369
00:25:36,899 --> 00:25:40,907
that they soon take total control over a nation's economy.

370
00:25:41,582 --> 00:25:45,619
It soon amounts to nothing but a plutocracy ruled by the rich.

371
00:25:47,039 --> 00:25:49,548
It would be is like putting control of the army

372
00:25:49,549 --> 00:25:51,168
in the hands of the mafia.

373
00:25:51,169 --> 00:25:53,243
The danger of tyranny would be extreme.

374
00:25:54,038 --> 00:25:55,124
Yes, we need central banks

375
00:25:56,411 --> 00:25:58,507
no, we do not need them in private hands!

376
00:26:00,587 --> 00:26:03,589
The central bank scam is really a hidden tax.

377
00:26:04,454 --> 00:26:07,362
The nation sells bonds to the central bank

378
00:26:07,363 --> 00:26:09,365
to pay for things for which the government does not have

379
00:26:09,384 --> 00:26:12,386
the political will to raise taxes to pay for.

380
00:26:12,847 --> 00:26:17,833
But the bonds are purchased with money the central bank creates out of nothing.

381
00:26:17,834 --> 00:26:20,908
More money in circulation makes your money worth less.

382
00:26:22,091 --> 00:26:24,414
The government get as much money as it needs

383
00:26:24,415 --> 00:26:26,494
and the people pay for it in inflation.

384
00:26:28,017 --> 00:26:33,120
The beauty of the plan is that not one person in a thousand can figure it out

385
00:26:33,274 --> 00:26:37,361
because it's usually hidden behind complex-sounding economics gibberish.

386
00:26:40,566 --> 00:26:42,598
With the formation of the Bank of England,

387
00:26:42,599 --> 00:26:44,604
the nation was soon awash in money.

388
00:26:46,425 --> 00:26:48,943
Prices throughout the country doubled.

389
00:26:48,944 --> 00:26:52,812
Massive loans were granted for just about any wild scheme.

390
00:26:52,813 --> 00:26:56,509
One venture proposed draining the Red Sea to recover gold

391
00:26:56,051 --> 00:26:59,067
supposedly lost when the Egyptian army drowned

392
00:26:59,922 --> 00:27:01,956
pursuing Moses and the Israelites.

393
00:27:03,938 --> 00:27:08,010
By 1698, government debt grew from the initial 1-1/4 million pounds

394
00:27:09,241 --> 00:27:10,245
to 16 million.

395
00:27:11,926 --> 00:27:16,958
Naturally, taxes were increased and then increased again to pay for all this.

396
00:27:17,641 --> 00:27:21,035
With the British money supply firmly in their grip,

397
00:27:21,036 --> 00:27:26,117
the British economy began a wild roller coaster series of booms and depressions,

398
00:27:26,118 --> 00:27:31,137
exactly the sort of thing a central bank claims it is designed to prevent.

399
00:27:32,791 --> 00:27:35,080
"There are two things which are intrinsic

400
00:27:35,081 --> 00:27:38,508
not just to the Bank of England, but to central banking generally.

401
00:27:38,509 --> 00:27:42,514
The first is an involvement in the formulation of monetary policy

402
00:27:45,006 --> 00:27:49,017
with the specific objective of achieving monetary stability."

403
00:27:51,824 --> 00:27:54,509
However, since the Bank of England took control,

404
00:27:54,051 --> 00:27:56,555
the British pound has rarely been stable.

405
00:27:57,015 --> 00:27:59,789
Now, let’s take a look at the role of the Rothschilds family,

406
00:27:59,079 --> 00:28:01,136
believed the wealthiest in the world.

407
00:28:11,316 --> 00:28:12,403
This is Frankfort, Germany.

408
00:28:13,576 --> 00:28:17,020
Fifty years after the Bank of England opened its doors,

409
00:28:17,021 --> 00:28:19,078
a goldsmith named Amschel Moses Bauer

410
00:28:20,813 --> 00:28:23,851
opened a coin shop - a counting house - in 1743,

411
00:28:26,352 --> 00:28:31,387
and over the door he placed a sign depicting a Roman eagle on a red shield.

412
00:28:31,908 --> 00:28:34,910
The shop became known as the Red Shield firm,

413
00:28:35,462 --> 00:28:36,543
or, in German, Rothschild.

414
00:28:38,287 --> 00:28:41,385
When his son, Amschel Meyer Bauer, inherited the business,

415
00:28:43,027 --> 00:28:45,035
he decided to change name to Rothschild.

416
00:28:46,602 --> 00:28:50,623
Meyer soon learned that loan money to governments and kings

417
00:28:50,886 --> 00:28:53,967
was more profitable than loaning to private individuals.

418
00:28:54,953 --> 00:28:56,968
Not only were the loans bigger

419
00:28:57,112 --> 00:29:00,126
but they were secured by the nation's taxes.

420
00:29:01,736 --> 00:29:03,752
Meyer Rothschild had five sons.

421
00:29:04,893 --> 00:29:07,695
He trained them all in the skills of money creation,

422
00:29:07,696 --> 00:29:10,604
then sent them to the major capitals of Europe

423
00:29:10,605 --> 00:29:13,679
to open branch offices of the family banking business.

424
00:29:14,621 --> 00:29:18,706
His first son, Amschel, stayed in Frankfort to mind the hometown bank.

425
00:29:20,042 --> 00:29:23,045
His second son, Salomon was sent to Vienna.

426
00:29:24,465 --> 00:29:27,470
His third son, Nathan was clearly the most clever.

427
00:29:28,791 --> 00:29:33,826
He was sent to London at age 21 in 1798, a hundred years after the founding

428
00:29:36,072 --> 00:29:37,140
of the Bank of England.

429
00:29:38,008 --> 00:29:40,070
His fourth son, Karl, went to Naples.

430
00:29:42,225 --> 00:29:44,281
His fifth son, Jakob, went to Paris.

431
00:29:46,549 --> 00:29:50,622
In 1785, Meyer Amschel moved his entire family to this larger house,

432
00:29:53,078 --> 00:29:56,163
a five story dwelling he shared with the Schiff family.

433
00:29:57,852 --> 00:30:00,896
This house was known as the "Green Shield" house.

434
00:30:01,871 --> 00:30:05,450
The Rothschilds and the Schiffs would play a central role

435
00:30:05,451 --> 00:30:07,537
in the rest of European financial history

436
00:30:08,479 --> 00:30:10,517
and in that of the United States.

437
00:30:13,116 --> 00:30:18,150
The Rothschilds broke into dealings with European royalty here at Wilhelmshohe,

438
00:30:18,561 --> 00:30:20,607
the palace of the wealthiest man in Germany

439
00:30:21,022 --> 00:30:24,118
in fact, the wealthiest monarch in all of Europe,

440
00:30:24,119 --> 00:30:26,135
prince William of Hesse-Kassel.

441
00:30:27,115 --> 00:30:32,160
At first, the Rothschilds were only helping William speculate in precious coins.

442
00:30:32,694 --> 00:30:36,767
But when Napoleon chased Prince William into exile, he sent £550,000

443
00:30:38,985 --> 00:30:41,011
- a gigantic sum at that time –

444
00:30:41,685 --> 00:30:43,731
to Nathan Rothschild in London

445
00:30:43,732 --> 00:30:46,605
with instructions from him to buy Consola -

446
00:30:46,606 --> 00:30:49,670
British government bonds also called government stock.

447
00:30:51,748 --> 00:30:55,173
But Rothschild used the money for his own purposes.

448
00:30:55,174 --> 00:30:56,755
With Napoleon on the loose

449
00:30:56,756 --> 00:31:00,779
the opportunities of wartime investments were nearly limitless.

450
00:31:02,679 --> 00:31:06,776
William returned here, sometime prior to the Battle of Waterloo in 1815.

451
00:31:08,454 --> 00:31:11,511
He summoned Rothschilds and demanded his money back.

452
00:31:12,881 --> 00:31:15,446
The Rothschilds returned William's money,

453
00:31:15,447 --> 00:31:19,447
with the 8% interest the British Consols would have paid him

454
00:31:19,448 --> 00:31:21,511
had the investment actually been made.

455
00:31:23,252 --> 00:31:28,330
But the Rothschilds kept all the past profits they had made using Wilhelm' s money.

456
00:31:31,727 --> 00:31:33,828
Nathan Rothschild later brag that

457
00:31:33,829 --> 00:31:36,317
in the seventeen years he had been in England,

458
00:31:36,318 --> 00:31:40,413
he had increased his original £20,000 stake given to him by his father

459
00:31:41,398 --> 00:31:42,413
by 2,500 times.

460
00:31:45,645 --> 00:31:50,691
By cooperating within the family, the Rothschilds soon grew unbelievably wealthy.

461
00:31:51,163 --> 00:31:54,211
By the mid-1800s, they dominated all European banking,

462
00:31:54,644 --> 00:31:57,718
and were certainly the wealthiest family in the world.

463
00:31:58,619 --> 00:31:59,706
They financed Cecil Rhodes,

464
00:32:00,843 --> 00:32:04,146
making it possible for him to establish a monopoly

465
00:32:04,147 --> 00:32:07,191
over the diamond and gold fields of South Africa.

466
00:32:07,715 --> 00:32:10,766
In America, they financed the Hermans in railroads,

467
00:32:11,601 --> 00:32:14,215
the Van Der Bilt in railroad and the press,

468
00:32:14,216 --> 00:32:16,500
the Carnegie in the steel industry,

469
00:32:16,501 --> 00:32:17,529
among many others.

470
00:32:19,833 --> 00:32:24,886
In fact, during WWI, J.P. Morgan was thought to be the richest man in America.

471
00:32:26,593 --> 00:32:28,482
But after his death, it was discovered

472
00:32:28,483 --> 00:32:32,486
that he was actually only a lieutenant of the Rothschilds.

473
00:32:33,015 --> 00:32:36,329
Once Morgan’s will became public, it was discovered

474
00:32:36,465 --> 00:32:39,520
that he owned only 19% of J.P. Morgan’s companies.

475
00:32:42,793 --> 00:32:46,889
By 1850, James Rothschild, the heir of the French branch of the family,

476
00:32:48,234 --> 00:32:52,277
was said to be worth 600 million French francs 150 million more

477
00:32:53,999 --> 00:32:57,004
than all the other bankers in France put together.

478
00:32:58,086 --> 00:33:02,148
He built this mansion, called Ferrières, 19 miles northeast of Paris.

479
00:33:03,681 --> 00:33:05,714
Wilhelm I, on seeing it exclaimed

480
00:33:06,344 --> 00:33:10,411
"Kings couldn't afford this. It could only belong to a Rothschild."

481
00:33:11,231 --> 00:33:14,708
Another 19 century French commentator put it this way;

482
00:33:14,709 --> 00:33:18,717
"There is but one power in Europe and that is Rothschild."

483
00:33:18,843 --> 00:33:21,726
There is no evidence that their predominant standing

484
00:33:21,727 --> 00:33:23,813
in European or world finance has changed.

485
00:33:26,543 --> 00:33:28,217
Now let's take a look at the results

486
00:33:28,218 --> 00:33:31,262
the Bank of England produced on the British economy

487
00:33:31,659 --> 00:33:35,714
and how that later was the root cause of the American Revolution.

488
00:33:41,068 --> 00:33:42,089
By the mid-1700s

489
00:33:42,735 --> 00:33:46,728
the British Empire was approaching its height of power around the world.

490
00:33:46,729 --> 00:33:49,826
Britain had fought four wars in Europe since the creation

491
00:33:50,736 --> 00:33:53,833
of its privately-owned central bank, the Bank of England.

492
00:33:54,916 --> 00:33:55,984
The cost had been high.

493
00:33:56,604 --> 00:34:01,660
To finance these wars, the British Parliament had borrowed heavily from the Bank.

494
00:34:02,814 --> 00:34:06,815
By the mid-1700s, the government's debt was £140,000,000

495
00:34:09,569 --> 00:34:11,596
a staggering sum for those days.

496
00:34:12,094 --> 00:34:15,306
Consequently, the British government embarked on a program

497
00:34:15,308 --> 00:34:18,724
of trying to raise revenues from its American colonies

498
00:34:18,725 --> 00:34:21,786
in order to make the interest payments to the Bank.

499
00:34:23,577 --> 00:34:25,668
But in America, it was a different story.

500
00:34:26,737 --> 00:34:31,108
The scourge of a privately-owned central bank had not yet hit.

501
00:34:31,648 --> 00:34:34,362
This is independence hall in Philadelphia

502
00:34:34,364 --> 00:34:38,487
where the declaration of independence and constitution were signed.

503
00:34:38,489 --> 00:34:42,497
In the mid-1700s, pre-Revolutionary America was still relatively poor.

504
00:34:43,916 --> 00:34:48,012
There was a severe shortage of precious metal coins to trade for goods,

505
00:34:48,891 --> 00:34:52,069
so the early colonists were forced to experiment

506
00:34:52,007 --> 00:34:55,034
with printing their own home-grown paper money.

507
00:34:55,065 --> 00:34:57,152
Some of these experiments were successful.

508
00:34:58,638 --> 00:35:03,664
Franklin was a big supporter of the colonies printing their own paper money.

509
00:35:04,653 --> 00:35:06,715
In 1757, Franklin was sent to London.

510
00:35:08,619 --> 00:35:11,288
He ended up staying for the next 18 years,

511
00:35:11,289 --> 00:35:14,334
nearly until the start of the American Revolution.

512
00:35:15,058 --> 00:35:20,061
During this period, the American colonies began to issue their own money.

513
00:35:21,115 --> 00:35:24,202
Called Colonial Scrip, the endeavour was very successful.

514
00:35:25,105 --> 00:35:27,187
It provided a reliable medium of exchange

515
00:35:27,926 --> 00:35:31,935
and it also helped to provide a feeling of unity between the colonies.

516
00:35:33,211 --> 00:35:36,475
Remember, most Colonial Scrip was just paper money

517
00:35:36,476 --> 00:35:37,515
- debt-free money –

518
00:35:37,989 --> 00:35:42,310
printed in the public interest and not backed by gold or silver coin.

519
00:35:42,311 --> 00:35:45,343
In other words, it was a totally fiat currency.

520
00:35:48,474 --> 00:35:50,809
One day, officials of the Bank of England

521
00:35:50,081 --> 00:35:55,650
asked Franklin how he would account for the new-found prosperity of the colonies.

522
00:35:56,038 --> 00:35:58,043
Without hesitation he replied:

523
00:36:22,469 --> 00:36:24,756
This was just common sense to Franklin

524
00:36:24,757 --> 00:36:28,793
but you can imagine the impact it had on the Bank of England.

525
00:36:29,769 --> 00:36:32,141
America had learned the secret of money

526
00:36:32,142 --> 00:36:36,225
and that genie had to be returned to its bottle as soon as possible.

527
00:37:29,455 --> 00:37:33,511
As a result, Parliament hurriedly passed the Currency Act of 1764.

528
00:37:35,024 --> 00:37:39,052
This prohibited colonial officials from issuing their own money

529
00:37:40,116 --> 00:37:44,122
and ordered them to pay all future taxes in gold or silver coins.

530
00:37:45,611 --> 00:37:49,689
In other words, it forced the colonies on a gold or silver standard.

531
00:37:51,183 --> 00:37:54,174
For those who still believe that a gold standard is the answer

532
00:37:54,175 --> 00:37:56,250
for America's current monetary problems,

533
00:37:56,964 --> 00:37:59,050
look what happened to America after that.

534
00:38:00,828 --> 00:38:02,927
Writing in his autobiography, Franklin said:

535
00:38:17,854 --> 00:38:22,898
Franklin claims that this was even the basic cause for the American Revolution.

536
00:38:24,006 --> 00:38:26,014
As Franklin put it in his autobiography:

537
00:38:54,654 --> 00:38:56,723
By the time the first shots were fired

538
00:38:56,724 --> 00:38:59,725
in Lexington, Massachusetts on April 19, 1775

539
00:39:01,003 --> 00:39:06,017
the colonies had been drained of gold and silver coin by British taxation.

540
00:39:07,648 --> 00:39:11,056
As result, the Continental government had no choice

541
00:39:11,057 --> 00:39:14,129
but to print its own paper money to finance the war.

542
00:39:14,981 --> 00:39:20,194
At the start of the Revolution, the U.S. money supply stood at $12 million.

543
00:39:20,195 --> 00:39:23,201
By the end of the war, it was nearly $500 million.

544
00:39:24,135 --> 00:39:27,180
As a result, the currency was virtually worthless.

545
00:39:28,245 --> 00:39:30,259
Shoes sold for $5,000 a pair.

546
00:39:32,024 --> 00:39:37,051
Colonial scrip had worked because just enough was issued to facilitate trade.

547
00:39:39,482 --> 00:39:42,509
As G. Washington lamented, a wagonload of money

548
00:39:43,246 --> 00:39:46,297
was scarcely purchase of a wagonload of provisions.

549
00:39:48,621 --> 00:39:51,648
Today, those who support a gold-backed currency

550
00:39:52,355 --> 00:39:54,711
point to this period during the Revolution

551
00:39:54,712 --> 00:39:57,721
to demonstrate the evils of a fiat currency.

552
00:39:58,499 --> 00:40:01,504
But remember, the same currency had worked so well

553
00:40:02,009 --> 00:40:04,464
twenty years earlier during times of peace

554
00:40:04,546 --> 00:40:07,551
that the Bank of England had Parliament outlaw it.

555
00:40:12,998 --> 00:40:15,587
Towards the end of the Revolution, the Continental Congress

556
00:40:15,588 --> 00:40:19,112
meeting at Independence Hall, grew desperate for money.

557
00:40:19,113 --> 00:40:23,165
In 1781, they allowed Robert Morris, their Financial Superintendent

558
00:40:24,002 --> 00:40:26,076
to open a privately-owned central bank.

559
00:40:27,971 --> 00:40:30,307
Incidentally, Morris was a wealthy man

560
00:40:30,308 --> 00:40:32,345
who had grown wealthier during the Revolution

561
00:40:32,346 --> 00:40:33,444
by trading in war materials.

562
00:40:36,231 --> 00:40:39,924
Called the Bank of North America, the new bank was closely modelled

563
00:40:39,925 --> 00:40:40,980
after the Bank of England.

564
00:40:41,476 --> 00:40:44,539
It was allowed to practice fractional reserve banking

565
00:40:45,408 --> 00:40:48,693
- that is, it could lend out money it didn't have

566
00:40:48,694 --> 00:40:49,786
then charge interest on it.

567
00:40:51,058 --> 00:40:56,063
If you or I were to do that, we would be charged with fraud, a felony.

568
00:40:58,586 --> 00:41:01,483
The Bank's charter called for private investors

569
00:41:01,484 --> 00:41:04,498
to put up $400,000 worth of initial capital.

570
00:41:05,456 --> 00:41:07,491
But when Morris was unable to raise the money

571
00:41:07,807 --> 00:41:12,809
he brazenly used his political influence to have gold deposited in the bank

572
00:41:13,513 --> 00:41:16,516
which had been loaned to America by France.

573
00:41:17,121 --> 00:41:20,086
He then loaned this money to himself and his friends

574
00:41:20,087 --> 00:41:22,131
to reinvest in shares of the bank.

575
00:41:23,254 --> 00:41:28,343
And, like the Bank of England, the bank was given a monopoly of the nation currency.

576
00:41:29,754 --> 00:41:31,770
Soon, the dangers became clear.

577
00:41:32,411 --> 00:41:35,462
The value of American currency continued to plummet

578
00:41:36,025 --> 00:41:38,034
so, four years later, in 1785

579
00:41:39,725 --> 00:41:41,730
the Bank's charter was not renewed.

580
00:41:44,728 --> 00:41:47,010
The leader of the successful effort to kill the Bank

581
00:41:47,011 --> 00:41:48,784
William Findley, of Pennsylvania

582
00:41:48,785 --> 00:41:50,801
explained the problem this way:

583
00:42:05,206 --> 00:42:07,649
The men behind the Bank of North America

584
00:42:07,065 --> 00:42:12,191
- Alexander Hamilton, Robert Morris, and the Bank's President, Thomas Willing

585
00:42:12,777 --> 00:42:13,798
did not give up.

586
00:42:14,587 --> 00:42:18,531
Only six years later, Hamilton - then Secretary of the Treasury

587
00:42:18,532 --> 00:42:19,589
and his mentor, Morris

588
00:42:20,754 --> 00:42:24,816
rammed a new privately-owned central bank through the new Congress.

589
00:42:27,823 --> 00:42:30,407
Called the First Bank of the United States

590
00:42:30,408 --> 00:42:33,470
Thomas Willing again served as the Bank's President.

591
00:42:34,066 --> 00:42:38,072
The players were the same, only the name of the Bank was changed.

592
00:42:44,683 --> 00:42:47,729
In 1787, colonial leaders assembled in Philadelphia

593
00:42:48,646 --> 00:42:51,674
to replace the ailing Articles of Confederation.

594
00:42:52,215 --> 00:42:55,719
As we saw earlier, both Thomas Jefferson and James Madison

595
00:42:55,072 --> 00:42:59,076
were unalterably opposed to a privately-owned central bank.

596
00:42:59,899 --> 00:43:03,901
They had seen the problems caused by the Bank of England.

597
00:43:05,101 --> 00:43:06,800
They wanted nothing of it.

598
00:43:06,801 --> 00:43:07,887
As Jefferson later put it:

599
00:43:35,103 --> 00:43:37,202
During the debate over the future monetary system,

600
00:43:38,094 --> 00:43:40,808
another one of the founding fathers, Gouverneur Morris,

601
00:43:40,809 --> 00:43:44,894
castigated the motivations of the owners of the bank of North America.

602
00:43:46,614 --> 00:43:49,018
Gouverneur Morris headed the committee that wrote

603
00:43:49,019 --> 00:43:51,402
the final draft of the constitution.

604
00:43:51,403 --> 00:43:54,418
Morris knew the motivations of the bank well.

605
00:43:54,991 --> 00:43:57,065
Along with his old boss, Robert Morris,

606
00:43:57,751 --> 00:44:00,776
Gouverneur Morris and Alexander Hamilton were the ones

607
00:44:00,777 --> 00:44:03,832
who had presented the original plan for the Bank of North America

608
00:44:04,328 --> 00:44:08,366
to the Continental Congress in the last year of the Revolution.

609
00:44:08,751 --> 00:44:11,834
In a letter he wrote to James Madison on July 2, 1787

610
00:44:13,959 --> 00:44:17,004
Gouverneur Morris revealed what was really going on:

611
00:44:37,752 --> 00:44:41,025
Despite the defection of Gouverneur Morris from the ranks of the Bank

612
00:44:41,026 --> 00:44:45,078
Hamilton, Robert Morris, Thomas Willing, and their European backers

613
00:44:45,564 --> 00:44:46,655
were not about to give up.

614
00:44:48,693 --> 00:44:52,485
They convinced the bulk of the delegates to the Constitution Convention

615
00:44:52,486 --> 00:44:55,553
to not give Congress the power to issue paper money.

616
00:44:57,225 --> 00:44:59,486
Most of the delegates were still reeling

617
00:44:59,487 --> 00:45:04,022
from the wild inflation of the paper currency during the Revolution.

618
00:45:04,023 --> 00:45:08,102
They had forgotten how well Colonial Scrip had worked before the War.

619
00:45:09,925 --> 00:45:12,141
But the Bank of England had not.

620
00:45:12,142 --> 00:45:14,074
The Money Changers could not stand

621
00:45:14,075 --> 00:45:17,090
to have America printing her own money again.

622
00:45:19,207 --> 00:45:21,293
The Constitution is silent on this point.

623
00:45:23,137 --> 00:45:27,145
This defect left the door wide open for the Money Changers

624
00:45:27,532 --> 00:45:28,540
just as they had planned.

625
00:45:35,473 --> 00:45:39,330
In 1790, less than three years after the Constitution had been signed

626
00:45:39,331 --> 00:45:41,353
the Money Changers struck again.

627
00:45:41,784 --> 00:45:46,228
The newly-appointed first Secretary of the Treasury, Alexander Hamilton

628
00:45:46,229 --> 00:45:48,250
proposed a bill to the Congress

629
00:45:48,552 --> 00:45:51,579
calling for a new privately-owned central bank.

630
00:45:52,816 --> 00:45:56,838
Coincidentally, that was the very year that Amschel Rothschild

631
00:45:57,426 --> 00:46:01,430
made his pronouncement from his flagship bank in Frankfort:

632
00:46:03,024 --> 00:46:08,088
"Let me issue and control a nation's money and I care not who writes its laws."

633
00:46:10,321 --> 00:46:14,325
Alexander Hamilton was a tool of the international bankers.

634
00:46:14,805 --> 00:46:18,847
He wanted to create the Bank of the United States, and did so.

635
00:46:22,234 --> 00:46:27,313
Interestingly, one of Hamilton's first jobs after graduating from law school in 1782

636
00:46:28,573 --> 00:46:33,579
was as an aide to Robert Morris, the head of the Bank of North America.

637
00:46:33,887 --> 00:46:38,650
In fact, the year before, Hamilton had written Morris a letter, saying:

638
00:46:38,651 --> 00:46:43,693
"A national debt, if it is not excessive, will be to us a national blessing".

639
00:46:44,434 --> 00:46:45,473
A blessing to whom?

640
00:46:47,876 --> 00:46:49,955
After a year of intense debate, in 1791

641
00:46:51,926 --> 00:46:54,935
Congress passed the bill and gave it a 20-year charter.

642
00:46:55,948 --> 00:47:00,977
The new bank was to be called the First Bank of the United States, or BUS.

643
00:47:01,538 --> 00:47:06,574
Here we are in front of the first Bank of the United States in Philadelphia.

644
00:47:07,355 --> 00:47:10,364
The Bank was given a monopoly on printing U.S. currency

645
00:47:11,306 --> 00:47:15,355
even though 80% of its stock would be held by private investors.

646
00:47:16,176 --> 00:47:19,577
The other 20% would be purchased by the U.S. Government

647
00:47:19,578 --> 00:47:23,174
but the reason was not to give the government a piece of the action,

648
00:47:23,175 --> 00:47:26,184
it was to provide the capital for the other 80% owners.

649
00:47:28,096 --> 00:47:32,097
As with the old bank of North America and the Bank of England before that,

650
00:47:32,197 --> 00:47:36,218
the stockholders never paid the full amount for their shares.

651
00:47:36,522 --> 00:47:40,689
The U.S. government put up their initial $2,000,000 in cash,

652
00:47:40,069 --> 00:47:44,287
then the Bank through the old magic of fractional reserve lending,

653
00:47:44,909 --> 00:47:48,911
made loans to its charter investors so they could come up

654
00:47:49,021 --> 00:47:51,437
with the remaining $8,000,000 in capital

655
00:47:51,438 --> 00:47:53,495
needed for this risk-free investment.

656
00:47:55,889 --> 00:47:57,208
Like the Bank of England

657
00:47:57,209 --> 00:48:01,100
the name of the Bank of the United States was deliberately chosen

658
00:48:01,101 --> 00:48:04,540
to hide the fact that it was privately controlled.

659
00:48:04,541 --> 00:48:07,607
And like the Bank of England, the names of the investors in the Bank

660
00:48:08,202 --> 00:48:09,206
were never revealed.

661
00:48:10,393 --> 00:48:12,715
Many years later it was a common saying

662
00:48:12,716 --> 00:48:16,793
that the Rothschilds were the power behind the old Bank of the U.S.

663
00:48:21,773 --> 00:48:25,645
The Bank was sold to Congress as a way to bring stability

664
00:48:25,646 --> 00:48:28,600
to the banking system and to eliminate inflation.

665
00:48:28,601 --> 00:48:29,623
So what happened?

666
00:48:30,024 --> 00:48:34,024
Over the first five years, the U.S. government borrowed $8.2 million

667
00:48:34,025 --> 00:48:36,030
from the Bank of the United States.

668
00:48:36,762 --> 00:48:38,841
In the same period, prices rose by 72%.

669
00:48:41,836 --> 00:48:44,395
Jefferson, as the new Secretary of State,

670
00:48:44,396 --> 00:48:47,550
watched the borrowing with sadness and frustration,

671
00:48:47,551 --> 00:48:48,584
unable to stop it.

672
00:49:01,467 --> 00:49:04,488
Millions of Americans feel the same way today.

673
00:49:05,043 --> 00:49:08,107
They watch in helpless frustration as the Federal government

674
00:49:08,684 --> 00:49:10,777
borrows the American economy into oblivion.

675
00:49:12,361 --> 00:49:15,450
So, although it was called the First Bank of the U.S.,

676
00:49:16,329 --> 00:49:21,383
it was not the first attempt at a privately-owned central bank in this country.

677
00:49:22,508 --> 00:49:24,471
As with the Bank of North America,

678
00:49:24,472 --> 00:49:28,226
the government put up the cash to get this private bank going,

679
00:49:28,227 --> 00:49:31,039
then the bankers loaned that money to each other

680
00:49:31,004 --> 00:49:33,083
to buy the remaining stock in the bank.

681
00:49:35,127 --> 00:49:37,159
It was a scam, plain and simple.

682
00:49:37,845 --> 00:49:40,928
And they wouldn't be able to get away with it for long,

683
00:49:40,929 --> 00:49:44,124
but first we have to travel back to Europe to see

684
00:49:44,125 --> 00:49:48,186
how a single man was able to manipulate the entire British economy

685
00:49:49,008 --> 00:49:52,093
by obtaining the first news of Napoleon's final defeat.

686
00:49:58,545 --> 00:50:02,317
Here in Paris, the Bank of France was organized in 1800

687
00:50:02,318 --> 00:50:04,333
just like the Bank of England.

688
00:50:04,533 --> 00:50:07,606
But Napoleon decided France had to break free of debt

689
00:50:08,479 --> 00:50:11,031
and he never trusted the Bank of France.

690
00:50:11,032 --> 00:50:15,291
He declared that when a government is dependent upon bankers for money,

691
00:50:15,292 --> 00:50:19,324
the bankers, not the leaders of the government are in control:

692
00:50:36,607 --> 00:50:39,675
Back in America, unexpected help was about to arrive.

693
00:50:40,569 --> 00:50:43,638
In 1800, Thomas Jefferson narrowly defeated John Adams

694
00:50:44,877 --> 00:50:48,373
to become the third President of the United States.

695
00:50:48,374 --> 00:50:51,379
By 1803, Jefferson and Napoleon had struck a deal.

696
00:50:52,008 --> 00:50:55,050
The U.S. would give Napoleon $3,000,000 in gold

697
00:50:56,402 --> 00:51:00,515
in exchange for a huge chunk of territory west of the Mississippi River

698
00:51:00,516 --> 00:51:01,523
- the Louisiana Purchase.

699
00:51:02,833 --> 00:51:07,024
With that three million dollars, Napoleon quickly forged an army

700
00:51:07,025 --> 00:51:11,046
and set off across Europe, conquering everything in his path.

701
00:51:11,576 --> 00:51:15,169
But the Bank of England quickly rose to oppose him.

702
00:51:15,017 --> 00:51:20,043
They financed every nation in his path, reaping the enormous profits of war.

703
00:51:21,957 --> 00:51:24,003
Prussia, Austria, and finally Russia

704
00:51:24,087 --> 00:51:28,136
all went heavily into debt in a futile attempt to stop Napoleon.

705
00:51:31,275 --> 00:51:34,570
Four years later, with the main French Army in Russia,

706
00:51:34,571 --> 00:51:36,575
30-year-old Nathan Rothschild

707
00:51:36,765 --> 00:51:39,536
- the head of the London office of the Rothschild family –

708
00:51:39,537 --> 00:51:41,599
personally took charge of a bold plan

709
00:51:42,581 --> 00:51:46,428
to smuggle a much-needed shipment of gold right through France

710
00:51:46,429 --> 00:51:50,437
to finance an attack by the Duke of Wellington from Spain.

711
00:51:51,056 --> 00:51:53,125
Nathan later bragged at a dinner party in London

712
00:51:54,251 --> 00:51:57,253
that it was the best business he’d ever done.

713
00:51:57,753 --> 00:52:02,789
Little did he know that he would do much better business in the near future.

714
00:52:04,373 --> 00:52:07,376
Wellington's attacks from the south, and other defeats,

715
00:52:07,404 --> 00:52:09,468
eventually forced Napoleon to abdicate,

716
00:52:10,594 --> 00:52:12,627
and Louis XVIII was crowned King.

717
00:52:13,889 --> 00:52:18,433
Napoleon was exiled to Elba, a tiny island off the coast of Italy,

718
00:52:18,434 --> 00:52:20,492
supposedly exiled from France forever.

719
00:52:23,276 --> 00:52:24,368
While Napoleon was on Elba,

720
00:52:25,674 --> 00:52:29,795
temporarily defeated by England with the financial help of the Rothschilds

721
00:52:29,796 --> 00:52:33,827
America was trying to break free of its central bank as well.

722
00:52:42,196 --> 00:52:45,355
In 1811, a bill was put before Congress to renew

723
00:52:45,356 --> 00:52:48,321
the charter of the Bank of the United States.

724
00:52:48,322 --> 00:52:50,156
The debate grew very heated

725
00:52:50,157 --> 00:52:53,043
and the legislature of both Pennsylvania and Virginia

726
00:52:53,044 --> 00:52:56,101
passed resolutions asking Congress to kill the Bank.

727
00:52:57,948 --> 00:53:01,141
The press corps of the day attacked the Bank openly,

728
00:53:01,142 --> 00:53:05,215
calling it "a great swindle", a "vulture", a "viper", and a "cobra".

729
00:53:06,549 --> 00:53:09,634
Oh, to have an independent press once again in America!

730
00:53:11,519 --> 00:53:13,540
A Congressman named P.B. Porter

731
00:53:13,911 --> 00:53:16,475
attacked the bank from the floor of Congress,

732
00:53:16,476 --> 00:53:18,768
saying that if the bank's charter were renewed,

733
00:53:18,769 --> 00:53:22,854
Congress "will have planted in the bosom of this Constitution a viper,

734
00:53:23,718 --> 00:53:28,724
which one day or another will sting the liberties of this country to the heart."

735
00:53:30,145 --> 00:53:32,230
Prospects didn't look good for the Bank.

736
00:53:33,488 --> 00:53:36,492
Writers have claimed that Nathan Rothschild warned

737
00:53:37,364 --> 00:53:41,948
that the United States would find itself involved in a most disastrous war

738
00:53:41,949 --> 00:53:44,028
if the Bank's charter were not renewed.

739
00:53:48,124 --> 00:53:49,536
But it wasn't enough.

740
00:53:49,537 --> 00:53:50,808
When the smoke had cleared,

741
00:53:50,809 --> 00:53:53,866
the renewal bill was defeated by a single vote in the House

742
00:53:54,038 --> 00:53:56,071
and was deadlocked in the Senate.

743
00:53:57,953 --> 00:54:02,405
By now, America's fourth President, James Madison, was in the White House.

744
00:54:02,406 --> 00:54:06,025
Remember, Madison was a staunch opponent of the Bank.

745
00:54:06,026 --> 00:54:10,089
His Vice President, George Clinton, broke a tie in the Senate

746
00:54:10,009 --> 00:54:12,036
and sent the Bank into oblivion.

747
00:54:14,703 --> 00:54:16,794
Within 5 months England attacked the U.S.

748
00:54:17,817 --> 00:54:19,819
and the War of 1812 was on.

749
00:54:21,113 --> 00:54:24,298
But the British were still busy fighting Napoleon,

750
00:54:24,299 --> 00:54:27,346
and so the war of 1812 ended in a draw in 1814.

751
00:54:30,198 --> 00:54:34,602
Though the Money Changers were temporarily down, they were far from out.

752
00:54:34,603 --> 00:54:38,894
it would take them only another two years to bring back their bank

753
00:54:38,895 --> 00:54:40,917
- bigger and stronger than ever.

754
00:54:48,607 --> 00:54:50,645
But now let's return to Napoleon.

755
00:54:51,538 --> 00:54:54,471
Because nothing else in history more aptly demonstrates

756
00:54:54,472 --> 00:54:58,124
the cunning of the Rothschild family then their control

757
00:54:58,125 --> 00:55:00,223
of the British stock market after Waterloo.

758
00:55:04,328 --> 00:55:08,363
In 1815, a year after the end of the War of 1812 in America,

759
00:55:08,909 --> 00:55:11,948
Napoleon escaped his exile and returned to Paris.

760
00:55:14,578 --> 00:55:17,155
French troops were sent out to capture him,

761
00:55:17,156 --> 00:55:21,562
but such was his charisma that the soldiers rallied around their old leader

762
00:55:21,563 --> 00:55:24,566
and hailed him as their Emperor once again.

763
00:55:26,098 --> 00:55:28,195
In March of 1815 Napoleon equipped an army

764
00:55:29,147 --> 00:55:31,200
which Britain's Duke of Wellington defeated

765
00:55:31,678 --> 00:55:33,734
less than 90 days later at Waterloo.

766
00:55:35,903 --> 00:55:39,331
Some writers claim Napoleon borrowed 5 million pounds

767
00:55:39,332 --> 00:55:41,376
from the Bank of England to rearm.

768
00:55:41,886 --> 00:55:46,947
But it appears these funds actually came from the Ouvrard banking house in Paris.

769
00:55:48,591 --> 00:55:50,660
Nevertheless, from about this point on,

770
00:55:51,317 --> 00:55:55,030
it was not unusual for privately-controlled central banks

771
00:55:55,031 --> 00:55:57,057
to finance both sides in a war.

772
00:55:59,137 --> 00:56:03,139
Why would a central bank finance opposing sides in a war?

773
00:56:03,239 --> 00:56:07,025
Because war is the biggest debt-generator of them all.

774
00:56:07,026 --> 00:56:10,035
A nation will borrow any amount for victory.

775
00:56:11,675 --> 00:56:14,166
The ultimate looser is loaned just enough

776
00:56:14,167 --> 00:56:16,584
to hold out the vain hope of victory,

777
00:56:16,585 --> 00:56:19,617
and the ultimate winner is given enough to win.

778
00:56:23,297 --> 00:56:27,012
Besides, such loans are usually conditioned upon the guarantee

779
00:56:27,013 --> 00:56:30,104
that the victor will honour the debts of the vanquished.

780
00:56:38,289 --> 00:56:42,317
This is the Waterloo battlefield about 200 miles northeast of Paris,

781
00:56:42,057 --> 00:56:43,065
in what today is Belgium.

782
00:56:45,269 --> 00:56:47,765
Here, Napoleon suffered his final defeat,

783
00:56:47,766 --> 00:56:50,601
but not before thousands of French and English men

784
00:56:50,602 --> 00:56:54,603
gave their lives on a steamy summer day in June of 1815.

785
00:56:56,359 --> 00:56:58,364
Right over there, on June 18, 1815,

786
00:57:00,195 --> 00:57:02,268
74,000 French troops met 67,000 troops

787
00:57:05,495 --> 00:57:07,576
from Britain, and other European nations.

788
00:57:08,964 --> 00:57:11,156
The outcome was certainly in doubt.

789
00:57:11,157 --> 00:57:14,182
In fact, had Napoleon attacked a few hours earlier,

790
00:57:14,183 --> 00:57:16,251
he would probably have won the battle.

791
00:57:16,891 --> 00:57:19,303
But no matter who won or lost, back in London,

792
00:57:19,304 --> 00:57:24,126
Nathan Rothschild planned to use the opportunity to try to seize control

793
00:57:24,127 --> 00:57:26,183
over the British stock and bond market,

794
00:57:26,184 --> 00:57:28,252
and possibly even the Bank of England.

795
00:57:30,828 --> 00:57:34,829
Rothschild stationed a trusted agent, a man named Rothworth,

796
00:57:35,542 --> 00:57:39,621
on the north side of the battlefield - closer to the English Channel.

797
00:57:40,901 --> 00:57:44,980
Once the battle had been decided, Rothworth took off for the Channel.

798
00:57:46,842 --> 00:57:50,706
He delivered the news to Nathan Rothschild a full 24 hours

799
00:57:50,707 --> 00:57:52,729
before Wellington's own courier.

800
00:57:53,782 --> 00:57:57,825
Rothschild hurried to the Stock Market and took up his usual position

801
00:57:57,826 --> 00:57:59,841
in front of an ancient pillar.

802
00:58:00,019 --> 00:58:01,075
All eyes were on him.

803
00:58:01,911 --> 00:58:04,975
The Rothschilds had a legendary communication network.

804
00:58:06,052 --> 00:58:11,056
If Wellington had been defeated and Napoleon were loose on the Continent again,

805
00:58:11,561 --> 00:58:14,642
Britain's financial situation would become grave indeed.

806
00:58:16,859 --> 00:58:17,941
Rothschild looked saddened.

807
00:58:19,215 --> 00:58:21,296
He stood there motionless, eyes downcast.

808
00:58:22,663 --> 00:58:24,685
Then suddenly, he began selling.

809
00:58:25,256 --> 00:58:28,262
Other nervous investors saw that Rothschild was selling.

810
00:58:28,317 --> 00:58:33,401
It could only mean one thing. Napoleon must have won. Wellington must have lost.

811
00:58:33,402 --> 00:58:34,448
The market plummeted.

812
00:58:34,872 --> 00:58:39,155
Soon, everyone was selling their Consols - their British government bonds

813
00:58:39,156 --> 00:58:40,243
and prices dropped sharply.

814
00:58:41,735 --> 00:58:45,338
But then Rothschild started secretly buying up the Consols

815
00:58:45,339 --> 00:58:49,365
through his agents at a fraction of their worth hours before.

816
00:58:51,019 --> 00:58:52,088
Myths, legends, you say?

817
00:58:53,474 --> 00:58:56,857
One hundred years later, the New York Times ran a story

818
00:58:56,858 --> 00:58:58,909
which said that Nathan's grandson had attempted

819
00:58:59,369 --> 00:59:04,375
to secure a court order to suppress a book with this stock market story in it.

820
00:59:04,043 --> 00:59:07,889
The Rothschild family claimed the story was untrue and libellous.

821
00:59:08,277 --> 00:59:10,769
But the court denied the Rothschilds' request

822
00:59:10,077 --> 00:59:13,103
and ordered the family to pay all court costs.

823
00:59:15,864 --> 00:59:18,821
What's even more interesting about this story

824
00:59:18,822 --> 00:59:22,906
is that some authors claim that the day after the Battle of Waterloo,

825
00:59:23,779 --> 00:59:28,851
in a matter of hours, Nathan Rothschild came to dominate not only the bond market,

826
00:59:29,998 --> 00:59:32,030
but the Bank of England as well.

827
00:59:33,059 --> 00:59:37,492
Whether or not the Rothschild family seized control of the Bank of England

828
00:59:38,024 --> 00:59:42,918
- the first privately-owned central bank in a major European nation, and the wealthiest

829
00:59:42,919 --> 00:59:43,964
one thing is certain

830
00:59:45,309 --> 00:59:50,375
by the mid-1800s, the Rothschilds were the richest family in the world, bar none.

831
00:59:51,002 --> 00:59:53,947
They dominated the new government bond markets

832
00:59:53,966 --> 00:59:57,035
and branched into other banks and industrial concerns.

833
01:00:00,282 --> 01:00:05,285
In fact, the rest of the 19th century was known as the "Age of Rothschild".

834
01:00:07,012 --> 01:00:08,986
Despite this overwhelming wealth,

835
01:00:09,095 --> 01:00:13,096
the family has generally cultivated an aura of invisibility.

836
01:00:13,979 --> 01:00:18,043
Although the family controls scores of industrial, commercial, mining

837
01:00:18,963 --> 01:00:23,014
and tourist corporations, only a handful bear the Rothschild name.

838
01:00:24,919 --> 01:00:28,116
By the end of the 19th century, one expert estimated

839
01:00:28,117 --> 01:00:32,173
that the Rothschild family controlled half the wealth of he world.

840
01:00:32,756 --> 01:00:34,792
Whatever the extent of their vast wealth,

841
01:00:35,117 --> 01:00:38,453
it is reasonable to assume that their percentage of the world's wealth

842
01:00:38,454 --> 01:00:39,529
has increased since then.

843
01:00:40,509 --> 01:00:44,491
But since the turn of the century, the Rothschilds have cultivated the notion

844
01:00:44,492 --> 01:00:48,554
that their power has somehow waned, even as their wealth increases.

845
01:00:57,307 --> 01:01:02,958
Just one year after Waterloo and Rothschilds' alleged takeover of the Bank of England,

846
01:01:02,959 --> 01:01:05,001
the American Congress passed a bill

847
01:01:05,002 --> 01:01:08,054
permitting yet another privately-owned central bank.

848
01:01:09,392 --> 01:01:13,400
This bank was called the Second Bank of the United States.

849
01:01:13,492 --> 01:01:16,990
The new Bank's charter was a copy of the previous Bank's.

850
01:01:16,991 --> 01:01:20,034
The U.S. government would own 20% of the shares.

851
01:01:20,596 --> 01:01:26,307
Of course, the Federal share was paid by the Treasury up front, into the Bank's coffers.

852
01:01:26,308 --> 01:01:29,631
Then, through the magic of fractional reserve lending,

853
01:01:29,632 --> 01:01:32,886
it was transformed into loans to private investors

854
01:01:32,887 --> 01:01:35,925
who then bought the remaining 80% of the shares.

855
01:01:37,298 --> 01:01:40,385
Just as before, the primary stockholders remained secret.

856
01:01:41,344 --> 01:01:45,853
But it is known that the largest block of shares - about one-third of the total

857
01:01:45,854 --> 01:01:46,917
was sold to foreigners.

858
01:01:48,002 --> 01:01:49,445
As one observer put it:

859
01:01:49,446 --> 01:01:53,473
"It is certainly no exaggeration to say that the Second Bank of the United States

860
01:01:53,717 --> 01:01:57,431
was rooted as deeply in Britain as it was in America."

861
01:01:57,432 --> 01:02:00,453
So by 1816, some authors claim the Rothschilds

862
01:02:01,303 --> 01:02:03,774
had taken control over the Bank of England

863
01:02:03,775 --> 01:02:07,842
and backed the new privately-owned central bank in America as well.

864
01:02:14,081 --> 01:02:17,158
After 12 years of manipulations of the U.S. economy

865
01:02:17,888 --> 01:02:20,140
on the part of the 2nd bank of the U.S.,

866
01:02:20,141 --> 01:02:23,168
the American people, had had just about enough.

867
01:02:23,059 --> 01:02:28,065
Opponents of the Bank nominated a dignified senator from Tennessee, Andrew Jackson

868
01:02:28,651 --> 01:02:32,676
the hero of the Battle of New Orleans, to run for president.

869
01:02:33,447 --> 01:02:35,486
This is his home, "The Hermitage".

870
01:02:38,558 --> 01:02:40,632
No one gave Jackson a chance initially.

871
01:02:41,605 --> 01:02:47,199
The Bank had long ago learned how the political process could be controlled with money.

872
01:02:47,002 --> 01:02:49,949
To the surprise and dismay of the Money Changers,

873
01:02:50,148 --> 01:02:52,216
Jackson was swept into office in 1828.

874
01:02:54,511 --> 01:02:57,943
Jackson was determined to kill the Bank at the first opportunity,

875
01:02:57,944 --> 01:03:00,022
and wasted no time in trying to do so.

876
01:03:01,213 --> 01:03:05,307
But the Bank's 20 year charter didn't come up for renewal until 1836,

877
01:03:07,349 --> 01:03:11,355
the last year of his second term - if he could survive that long.

878
01:03:13,162 --> 01:03:16,167
During his first term, Jackson contented himself

879
01:03:16,213 --> 01:03:19,991
with rooting out the Bank's many minions from government service.

880
01:03:19,992 --> 01:03:23,998
He fired 2,000 of the 11,000 employees of the federal government.

881
01:03:24,746 --> 01:03:29,754
In 1832, with his re-election approaching, the Bank struck an early blow,

882
01:03:30,418 --> 01:03:34,006
hoping Jackson would not want to stir up controversy.

883
01:03:34,007 --> 01:03:38,009
They asked Congress to pass a renewal bill four years early.

884
01:03:38,628 --> 01:03:42,643
Congress complied, and sent it to the President for signing.

885
01:03:43,764 --> 01:03:46,108
But Jackson weighed in with both feet.

886
01:03:46,109 --> 01:03:49,136
"Old Hickory," never a coward, vetoed the bill.

887
01:03:49,758 --> 01:03:52,849
His veto message is one of the great American documents.

888
01:03:53,797 --> 01:03:57,831
It clearly lays out the responsibility of the American government

889
01:03:57,832 --> 01:03:59,889
towards its citizens - rich and poor.

890
01:05:02,088 --> 01:05:07,131
Later that year, in July 1832, Congress was unable to override Jackson's veto.

891
01:05:09,084 --> 01:05:11,175
Now Jackson had to stand for re-election.

892
01:05:12,103 --> 01:05:15,235
Jackson took his argument directly to the people.

893
01:05:15,236 --> 01:05:16,324
For the first time in U.S. history,

894
01:05:17,117 --> 01:05:20,168
Jackson took his presidential campaign on the road.

895
01:05:21,555 --> 01:05:26,566
Before then, presidential candidates stayed at home and looked presidential.

896
01:05:26,741 --> 01:05:29,768
His campaign slogan was " Jackson and no Bank!"

897
01:05:30,083 --> 01:05:34,152
The National Republican Party ran Senator Henry Clay against Jackson.

898
01:05:35,602 --> 01:05:40,919
Despite the fact that the Bank poured in over $3,000,000 into Clay's campaign,

899
01:05:40,092 --> 01:05:44,100
Jackson was re-elected by a landslide in November of 1832.

900
01:05:46,198 --> 01:05:50,205
Despite his presidential victory, Jackson knew the battle was only beginning:

901
01:05:50,899 --> 01:05:54,370
"The hydra of corruption is only scotched, not dead,"

902
01:05:54,371 --> 01:05:56,543
said the newly-elected President.

903
01:05:56,544 --> 01:06:00,431
Jackson ordered his new Secretary of the Treasury, Louis McLane,

904
01:06:00,432 --> 01:06:04,565
to start removing the government's deposits from the Second Bank

905
01:06:04,566 --> 01:06:07,272
and to start placing them in state banks.

906
01:06:07,273 --> 01:06:08,347
McLane refused to do so.

907
01:06:09,635 --> 01:06:12,666
Jackson fired him and appointed William J. Duane

908
01:06:12,946 --> 01:06:15,003
as the new Secretary of the Treasury.

909
01:06:15,517 --> 01:06:19,526
Duane also refused to comply with the President's requests,

910
01:06:20,026 --> 01:06:22,212
and so Jackson fired him as well,

911
01:06:22,447 --> 01:06:25,485
and then appointed Roger B. Taney to the office.

912
01:06:26,009 --> 01:06:31,065
Taney did withdraw government funds from the bank, starting on October 1st, 1833.

913
01:06:32,778 --> 01:06:33,824
Jackson was jubilant:

914
01:06:34,489 --> 01:06:39,951
"I have it chained. I am ready with screws to draw every tooth and then the stumps"

915
01:06:39,952 --> 01:06:41,957
But the Bank was yet done fighting.

916
01:06:42,857 --> 01:06:44,572
Its head, Nicholas Biddle,

917
01:06:44,573 --> 01:06:48,634
used his influence to get the Senate to reject Taney's nomination.

918
01:06:49,222 --> 01:06:52,567
Then, in a rare show of arrogance, Biddle threatened

919
01:06:52,568 --> 01:06:55,664
to cause a depression if the Bank were not re-chartered.

920
01:07:08,813 --> 01:07:11,891
Next, in an unbelievable fit of honesty for a central banker,

921
01:07:12,594 --> 01:07:16,433
Biddle admitted that the bank was going to make money scarce

922
01:07:16,434 --> 01:07:18,502
to force Congress to restore the Bank:

923
01:07:38,751 --> 01:07:39,838
What a stunning revelation!

924
01:07:40,714 --> 01:07:43,800
Here was the pure truth, revealed with shocking clarity.

925
01:07:44,078 --> 01:07:47,639
Biddle intended to use the money contraction power of the Bank

926
01:07:48,342 --> 01:07:51,404
to cause a massive depression until America gave in.

927
01:07:52,394 --> 01:07:56,298
Unfortunately, this has happened time and time again throughout U.S. history,

928
01:07:56,299 --> 01:07:58,384
and is about to happen in today’s world.

929
01:08:00,414 --> 01:08:02,422
Nicholas Biddle made good on his threat.

930
01:08:03,263 --> 01:08:05,852
The Bank sharply contracted the money supply

931
01:08:05,853 --> 01:08:08,949
by calling in old loans and refusing to extend new ones.

932
01:08:10,885 --> 01:08:13,971
A financial panic ensued, followed by a deep depression.

933
01:08:15,481 --> 01:08:20,412
Predictably, Biddle blamed Jackson for the crash, saying that it was caused

934
01:08:20,412 --> 01:08:23,853
by the withdrawal of federal funds from the Bank.

935
01:08:24,517 --> 01:08:26,563
Unfortunately, his plan worked well.

936
01:08:27,124 --> 01:08:28,193
Wages and prices sagged.

937
01:08:29,068 --> 01:08:32,121
Unemployment soared along with business bankruptcies.

938
01:08:32,629 --> 01:08:34,944
The nation quickly went into an uproar.

939
01:08:34,946 --> 01:08:37,969
Newspaper editors blasted Jackson in editorials.

940
01:08:38,671 --> 01:08:40,926
The Bank threatened to withhold payment

941
01:08:40,928 --> 01:08:45,296
which then could be made directly to key politicians for their support.

942
01:08:45,296 --> 01:08:50,377
Within only months, Congress assembled in what was called the "Panic Session"

943
01:08:50,377 --> 01:08:53,546
Six months after he had withdrawn funds from the bank,

944
01:08:53,548 --> 01:08:56,570
Jackson was officially censured by a resolution

945
01:08:57,285 --> 01:09:00,640
which passed the Senate by a vote of 26 to 20.

946
01:09:00,064 --> 01:09:04,126
It was the first time a President had ever been censured by Congress.

947
01:09:04,703 --> 01:09:06,799
Jackson lashed out at the Bank.

948
01:09:06,008 --> 01:09:08,709
"You are a den of vipers. I intend to rout you out

949
01:09:09,502 --> 01:09:12,521
and by the Eternal God I will rout you out."

950
01:09:14,045 --> 01:09:16,677
America's fate teetered on a knife edge.

951
01:09:17,084 --> 01:09:20,135
If Congress could muster enough votes to override Jackson's veto,

952
01:09:20,595 --> 01:09:26,124
the Bank would be granted another 20-year monopoly or more over America's money

953
01:09:26,125 --> 01:09:29,188
- time enough to consolidate its already great power.

954
01:09:30,028 --> 01:09:31,103
Then, a miracle occurred.

955
01:09:32,303 --> 01:09:36,225
The Governor of Pennsylvania came out supporting President Jackson

956
01:09:36,225 --> 01:09:38,506
and strongly criticized the Bank.

957
01:09:38,854 --> 01:09:42,216
On top of that, Biddle had been caught boasting in public

958
01:09:42,218 --> 01:09:45,226
about the Bank's plan to crash the economy.

959
01:09:45,915 --> 01:09:46,996
Suddenly the tide shifted.

960
01:09:48,185 --> 01:09:52,222
In April of 1834, the House of Representatives voted 134 to 82

961
01:09:53,043 --> 01:09:55,204
against re-chartering the Bank.

962
01:09:55,088 --> 01:09:58,314
This was followed up by an even more lopsided vote

963
01:09:59,107 --> 01:10:04,198
to establish a special committee to investigate whether the Bank had caused the crash.

964
01:10:05,529 --> 01:10:09,390
When the investigating committee arrived at the Bank's door in Philadelphia,

965
01:10:09,391 --> 01:10:14,378
armed with a subpoena to examine the books, Biddle refused to give them up.

966
01:10:14,379 --> 01:10:18,500
Nor would he allow inspection of correspondence with Congressmen

967
01:10:18,501 --> 01:10:21,517
relating to their personal loans and advances.

968
01:10:22,162 --> 01:10:26,213
Biddle refused to testify before the committee back in Washington.

969
01:10:28,127 --> 01:10:31,224
On January 8, 1835, Jackson paid off the final instalment

970
01:10:33,377 --> 01:10:37,341
on the national debt which had been necessitated by allowing the banks

971
01:10:37,342 --> 01:10:39,867
to issue currency for government bonds,

972
01:10:39,868 --> 01:10:43,869
rather than simply issuing Treasury notes without such debt.

973
01:10:44,189 --> 01:10:47,255
He was the only President to ever pay off the debt.

974
01:10:48,906 --> 01:10:50,985
A few weeks later, on January 30, 1835,

975
01:10:52,321 --> 01:10:57,353
an assassin by the name of Richard Lawrence tried to shoot President Jackson.

976
01:10:58,425 --> 01:10:59,477
Both pistols misfired.

977
01:11:00,427 --> 01:11:04,430
Lawrence was later found not guilty by reason of insanity.

978
01:11:04,484 --> 01:11:07,560
After his release, he bragged to friends that powerful people in Europe

979
01:11:08,245 --> 01:11:13,268
had put him up to the task and promised to protect him if he were caught.

980
01:11:14,378 --> 01:11:16,461
The following year, when its charter ran out,

981
01:11:17,209 --> 01:11:22,701
the Second Bank of the United States ceased functioning as the nation's central bank.

982
01:11:22,702 --> 01:11:25,741
Biddle was later arrested and charged with fraud.

983
01:11:26,326 --> 01:11:32,357
He was tried and acquitted, but died shortly thereafter while still tied up in civil suits.

984
01:11:34,073 --> 01:11:36,090
After his second term as President,

985
01:11:36,244 --> 01:11:40,341
Jackson retired to The Hermitage outside Nashville to live out his life.

986
01:11:41,471 --> 01:11:45,698
He is still remembered for his determination to "kill the Bank".

987
01:11:45,699 --> 01:11:51,703
In fact, he killed it so well that it took the Money Changers 77 years to undo the damage.

988
01:11:54,888 --> 01:11:59,271
When asked what his most important accomplishment had been, Jackson replied.

989
01:11:59,272 --> 01:12:00,317
"I killed the Bank."

990
01:12:05,278 --> 01:12:10,340
Unfortunately, even Jackson failed to grasp the entire picture and its root cause.

991
01:12:11,076 --> 01:12:13,437
Although Jackson had killed the central bank,

992
01:12:14,122 --> 01:12:18,741
the most insidious weapon of the Money Changers - fractional reserve banking

993
01:12:18,742 --> 01:12:21,816
remained in use by the numerous state-chartered banks.

994
01:12:23,147 --> 01:12:27,215
This fuelled economic instability in the years before the Civil War.

995
01:12:28,027 --> 01:12:30,072
Still, the central bankers were out

996
01:12:30,982 --> 01:12:34,073
and as a result America thrived as it expanded westward.

997
01:12:36,907 --> 01:12:39,488
During this time, the principal Money Changers

998
01:12:39,489 --> 01:12:43,545
struggled to regain their lost centralized power, but to no avail.

999
01:12:45,002 --> 01:12:50,016
Finally they reverted to the old central banker's formula - finance a war,

1000
01:12:50,803 --> 01:12:52,804
to create debt and dependency.

1001
01:12:53,257 --> 01:12:56,006
If they couldn't get their central bank any other way,

1002
01:12:56,007 --> 01:13:00,096
America could be brought to its knees by plunging it into a civil war

1003
01:13:01,082 --> 01:13:07,083
just as they had done in 1812, after the First Bank of the U.S. was not re-chartered.

1004
01:13:08,993 --> 01:13:11,081
One month after the inauguration of Abraham Lincoln,

1005
01:13:11,874 --> 01:13:15,025
the first shots of the American Civil War were fired

1006
01:13:15,026 --> 01:13:18,070
at Fort Sumter, South Carolina on April 12, 1861.

1007
01:13:21,588 --> 01:13:26,613
Certainly slavery was a cause for the Civil War, but not the primary cause.

1008
01:13:28,575 --> 01:13:32,619
Lincoln knew that the economy of the South depended upon slavery

1009
01:13:33,747 --> 01:13:38,470
and so (before the Civil War) he had no intention of eliminating it.

1010
01:13:38,471 --> 01:13:43,502
Lincoln had put it this way in his inaugural address only one month earlier:

1011
01:14:01,257 --> 01:14:04,330
Even after the first shots were fired at Fort Sumter,

1012
01:14:04,988 --> 01:14:10,060
Lincoln continued to insist that the Civil War was not about the issue of slavery:

1013
01:14:27,358 --> 01:14:29,419
So what was the Civil War all about?

1014
01:14:30,476 --> 01:14:32,503
There were many factors at play.

1015
01:14:32,816 --> 01:14:35,857
Northern industrialists had used protective tariffs

1016
01:14:36,229 --> 01:14:40,292
to prevent their southern states from buying cheaper European goods.

1017
01:14:41,958 --> 01:14:45,959
Europe retaliated by stopping cotton imports from the South.

1018
01:14:46,409 --> 01:14:49,424
The Southern states were in a financial bind.

1019
01:14:49,095 --> 01:14:52,969
They were forced to pay more for most of the necessities of life

1020
01:14:53,825 --> 01:14:57,833
while their income from cotton exports plummeted. The South was angry.

1021
01:15:00,446 --> 01:15:02,695
But there were other factors at work.

1022
01:15:02,696 --> 01:15:07,880
The Money Changers were still stung by America's withdrawal from their control

1023
01:15:07,881 --> 01:15:08,903
25 years earlier.

1024
01:15:10,758 --> 01:15:14,790
Since then, America's wildcat economy had made the nation rich

1025
01:15:15,521 --> 01:15:17,588
a bad example for the rest the world.

1026
01:15:18,935 --> 01:15:23,568
The central bankers now saw an opportunity to split the rich new nation

1027
01:15:23,569 --> 01:15:25,578
to divide and conquer by war.

1028
01:15:28,115 --> 01:15:31,120
Was this just some sort of wild conspiracy theory?

1029
01:15:32,235 --> 01:15:38,239
Well, let's look at what a well placed observer of the scene had to say at the time.

1030
01:15:39,516 --> 01:15:42,561
This was Otto von Bismarck, Chancellor of Germany,

1031
01:15:43,067 --> 01:15:46,076
the man who united the German states a few years later.

1032
01:16:13,831 --> 01:16:16,839
Within months after the first shots here at Fort Sumter,

1033
01:16:16,084 --> 01:16:19,345
the central bankers loaned Napoleon III of France

1034
01:16:20,102 --> 01:16:22,159
(the nephew of the Waterloo Napoleon)

1035
01:16:22,701 --> 01:16:25,769
210 million francs to seize Mexico and station troops

1036
01:16:27,383 --> 01:16:29,420
along the southern border of the U.S.,

1037
01:16:29,754 --> 01:16:33,703
taking advantage of the War to violate the Monroe Doctrine

1038
01:16:33,704 --> 01:16:35,749
and return Mexico to colonial rule.

1039
01:16:38,014 --> 01:16:40,883
No matter what the outcome of the Civil War,

1040
01:16:41,001 --> 01:16:44,384
a weakened America, heavily indebted to the Money Changers,

1041
01:16:44,394 --> 01:16:47,326
would open up Central and South America once again

1042
01:16:47,327 --> 01:16:49,391
to European colonization and domination

1043
01:16:50,046 --> 01:16:54,072
the very thing America's Monroe Doctrine had forbade in 1823.

1044
01:16:57,328 --> 01:17:01,423
At the same time, Great Britain moved 11,000 troops into Canada

1045
01:17:01,424 --> 01:17:05,452
and positioned them menacingly along America's northern border.

1046
01:17:05,968 --> 01:17:11,035
The British fleet went on war alert should their quick intervention be called for.

1047
01:17:12,846 --> 01:17:14,913
Lincoln knew he was in a double bind.

1048
01:17:15,829 --> 01:17:18,884
That’s why he agonized over the fate of the Union.

1049
01:17:19,635 --> 01:17:24,540
There was a lot more to it than just differences between the North and the South.

1050
01:17:24,541 --> 01:17:30,541
That's why his emphasis was always on "Union" and not merely the defeat of the South.

1051
01:17:31,045 --> 01:17:33,072
But Lincoln needed money to win.

1052
01:17:33,404 --> 01:17:37,477
In 1861, Lincoln and his Secretary of the Treasury, Salmon P. Chase,

1053
01:17:39,092 --> 01:17:42,147
went to New York to apply for the necessary loans.

1054
01:17:42,782 --> 01:17:45,881
The Money Changers, anxious to see the Union fail,

1055
01:17:45,882 --> 01:17:47,915
offered loans at 24-36% interest.

1056
01:17:50,074 --> 01:17:54,107
Lincoln said thanks, but no thanks, and returned to Washington.

1057
01:17:54,936 --> 01:17:58,084
He sent for an old friend, Colonel Dick Taylor of Chicago,

1058
01:17:58,085 --> 01:18:01,146
and put him onto the problem off financing the War.

1059
01:18:02,135 --> 01:18:06,136
During one meeting, Lincoln asked Taylor what he discovered.

1060
01:18:06,437 --> 01:18:07,505
Taylor put it this way:

1061
01:18:25,648 --> 01:18:29,153
When Lincoln asked if the people of the United States would accept the notes,

1062
01:18:29,154 --> 01:18:29,241
Taylor said:

1063
01:18:49,523 --> 01:18:51,864
So that's exactly what Lincoln did.

1064
01:18:51,865 --> 01:18:55,866
In 1862-63, he printed up $432 million of the new bills.

1065
01:18:58,831 --> 01:19:02,542
In order to distinguish them from other bank notes in circulation,

1066
01:19:02,543 --> 01:19:05,667
he printed them in green ink on the back side.

1067
01:19:05,668 --> 01:19:08,814
That's why the notes were called "Greenbacks."

1068
01:19:08,815 --> 01:19:13,260
With this new money, Lincoln paid the troops, and bought their supplies.

1069
01:19:13,261 --> 01:19:17,910
During the course of the war, nearly 450 million dollars of Greenbacks

1070
01:19:17,911 --> 01:19:20,985
were printed at no interest to the federal government.

1071
01:19:23,245 --> 01:19:26,546
Lincoln realized who was really pulling the strings

1072
01:19:26,547 --> 01:19:29,442
and what was at stake for the American people.

1073
01:19:29,443 --> 01:19:31,517
This is how he explained his rationale:

1074
01:20:05,867 --> 01:20:08,900
A truly incredible editorial in the London Times

1075
01:20:09,631 --> 01:20:13,639
explained the Bank of England's attitude towards Lincoln's Greenbacks.

1076
01:20:50,893 --> 01:20:51,968
This scheme was effective

1077
01:20:52,831 --> 01:20:57,840
so effective that the next year, 1863, with Federal and Confederate troops

1078
01:20:57,943 --> 01:21:01,955
beginning to mass for the decisive battle of the Civil War,

1079
01:21:01,956 --> 01:21:05,135
and the Treasury in need of further Congressional authority

1080
01:21:05,136 --> 01:21:06,211
to issue more Greenbacks,

1081
01:21:07,029 --> 01:21:11,103
Lincoln allowed the bankers to push through the National Banking Act.

1082
01:21:12,376 --> 01:21:16,934
These new national banks would operate under a virtual tax-free status

1083
01:21:16,935 --> 01:21:20,936
and collectively have the exclusive monopoly power to create

1084
01:21:21,269 --> 01:21:23,274
the new form of money - Bank Notes.

1085
01:21:25,268 --> 01:21:29,367
Though Greenbacks continued to circulate, their number were not increased.

1086
01:21:30,099 --> 01:21:34,108
But most importantly, from this point on, the entire U.S. money supply

1087
01:21:36,358 --> 01:21:41,101
would be created out of debt by bankers buying U.S. government bonds,

1088
01:21:41,102 --> 01:21:44,117
and issuing them for reserves for Bank Notes.

1089
01:21:44,623 --> 01:21:47,634
As historian John Kenneth Galbraith explained:

1090
01:22:09,002 --> 01:22:14,004
In 1863, Lincoln got some unexpected help from Czar Alexander II of Russia.

1091
01:22:16,315 --> 01:22:18,748
The Czar, like Bismarck in Germany,

1092
01:22:18,749 --> 01:22:22,140
knew what the international Money Changers were up to

1093
01:22:22,141 --> 01:22:27,148
and had steadfastly refused to let them set up a central bank in Russia.

1094
01:22:28,077 --> 01:22:32,444
If America survived and was able to remain out of their clutches,

1095
01:22:32,445 --> 01:22:34,473
his position would remain secure.

1096
01:22:35,961 --> 01:22:39,145
If the bankers were successful at dividing America

1097
01:22:39,146 --> 01:22:42,303
and giving the pieces back to Great Britain and France

1098
01:22:42,304 --> 01:22:45,520
(both nations under control of their central banks)

1099
01:22:45,521 --> 01:22:47,620
eventually they would threaten Russia again.

1100
01:22:50,479 --> 01:22:54,071
So, the Czar gave orders that if either England or France

1101
01:22:54,072 --> 01:22:56,976
actively intervened and gave aid to the South,

1102
01:22:56,977 --> 01:23:00,980
Russia would consider such action as a declaration of war.

1103
01:23:01,486 --> 01:23:04,547
He sent his Pacific fleet to port in San Francisco.

1104
01:23:08,256 --> 01:23:11,259
Lincoln was re-elected the next year, 1864.

1105
01:23:11,627 --> 01:23:13,772
Had he lived, he would surely have killed

1106
01:23:13,773 --> 01:23:17,847
the National Banks' money monopoly extracted from him during the war.

1107
01:23:19,121 --> 01:23:22,200
On November 21, 1864, he wrote a friend the following:

1108
01:23:40,247 --> 01:23:42,322
Shortly before Lincoln was assassinated,

1109
01:23:42,323 --> 01:23:45,067
his former Secretary of the Treasury, Salmon P. Chase,

1110
01:23:45,068 --> 01:23:48,095
bemoaned his role in helping secure the passage

1111
01:23:48,467 --> 01:23:51,472
of the National Banking Act only one year earlier:

1112
01:24:07,655 --> 01:24:10,752
On April 14, 1865, 41 days after his second inauguration,

1113
01:24:13,154 --> 01:24:16,723
and five days after Lee surrendered to Grant at Appomattox,

1114
01:24:16,724 --> 01:24:20,726
Lincoln was shot by John Wilkes Booth, at Ford's theatre.

1115
01:24:22,279 --> 01:24:26,348
Bismarck Chancellor of Germany lamented the death of Abraham Lincoln:

1116
01:24:58,341 --> 01:25:01,342
Bismarck well understood the Money Changers' plan.

1117
01:25:01,352 --> 01:25:05,423
Allegations that international bankers were responsible for Lincoln's assassination

1118
01:25:06,063 --> 01:25:09,066
surfaced in Canada 70 years later, in 1934.

1119
01:25:11,095 --> 01:25:15,140
Gerald G. McGeer, a popular and well-respected Canadian attorney,

1120
01:25:16,957 --> 01:25:19,995
revealed this stunning charge in a 5-hour speech

1121
01:25:20,595 --> 01:25:21,687
before the House of Commons

1122
01:25:22,596 --> 01:25:24,688
blasting Canada's debt-based money system.

1123
01:25:27,164 --> 01:25:31,089
Remember, it was 1934, the height of the Great Depression

1124
01:25:31,009 --> 01:25:33,048
which was ravaging Canada as well.

1125
01:25:34,469 --> 01:25:37,647
McGeer had obtained evidence deleted from the public record,

1126
01:25:37,648 --> 01:25:40,409
provided to him by Secret Service agents,

1127
01:25:40,041 --> 01:25:43,882
from the trial of John Wilkes Booth, after Booth's death.

1128
01:25:44,252 --> 01:25:47,327
McGeer said it showed that Booth was a mercenary

1129
01:25:47,328 --> 01:25:49,829
working for the international bankers.

1130
01:25:49,083 --> 01:25:53,108
According to an article in the Vancouver Sun of May 2, 1934:

1131
01:26:25,696 --> 01:26:29,444
Interestingly, McGeer claimed that Lincoln was assassinated not only

1132
01:26:29,445 --> 01:26:34,306
because international bankers wanted to re-establish a central bank in America,

1133
01:26:34,307 --> 01:26:38,026
but because they also wanted to base America's currency on gold

1134
01:26:38,027 --> 01:26:39,031
gold they controlled

1135
01:26:40,425 --> 01:26:43,463
in other words, put America on a "gold standard"

1136
01:26:44,219 --> 01:26:48,305
Lincoln had done just the opposite by issuing U.S. Notes – Greenbacks

1137
01:26:48,306 --> 01:26:53,424
which were based purely on the good faith and credit of the United States.

1138
01:26:53,425 --> 01:26:55,476
The article quoted McGeer as saying:

1139
01:27:24,656 --> 01:27:28,734
Not since Lincoln has the U.S. issued debt-free United States Notes.

1140
01:27:29,915 --> 01:27:32,920
These red-sealed bills, which were issued in 1963,

1141
01:27:34,122 --> 01:27:36,204
were not a new issue from president Kennedy,

1142
01:27:36,943 --> 01:27:39,951
but merely the old Greenbacks reissued year after year.

1143
01:27:44,044 --> 01:27:48,052
In another act of folly and ignorance, the 1994 Reigle Act

1144
01:27:48,295 --> 01:27:53,352
actually authorized the replacement of Lincoln's Greenbacks with debt-based Notes.

1145
01:27:53,985 --> 01:27:59,029
In other words, Greenbacks were in circulation in the United States until 1994.

1146
01:28:00,224 --> 01:28:03,530
Why was silver bad for the bankers and gold good?

1147
01:28:03,531 --> 01:28:06,629
Simple. Because silver was plentiful in the United States,

1148
01:28:07,517 --> 01:28:09,603
it was relatively hard to control.

1149
01:28:09,604 --> 01:28:11,666
Gold was, and always has been scarce.

1150
01:28:13,252 --> 01:28:17,266
Throughout history it has been relatively easy to monopolize gold,

1151
01:28:17,267 --> 01:28:20,359
but silver has historically been 15 times more plentiful.

1152
01:28:27,000 --> 01:28:30,237
With Lincoln out of the way, the Money Changers' next objective

1153
01:28:30,238 --> 01:28:33,243
was to gain complete control over America's money.

1154
01:28:33,969 --> 01:28:35,031
This was no easy task.

1155
01:28:36,219 --> 01:28:41,967
With the opening of the American West, silver had been discovered in huge quantities.

1156
01:28:41,968 --> 01:28:45,886
On top of that, Lincoln's Greenbacks were generally popular.

1157
01:28:45,887 --> 01:28:49,920
Despite the European central bankers' deliberate attacks on Greenbacks,

1158
01:28:50,218 --> 01:28:55,220
they continued to circulate in the United States, until a few years ago.

1159
01:28:55,077 --> 01:28:57,152
According to historian W. Cleon Skousen:

1160
01:29:18,024 --> 01:29:22,465
It is clear that the concept of America printing her own debt-free money

1161
01:29:22,682 --> 01:29:27,024
sent shock-waves throughout the European private-central-banking elite.

1162
01:29:27,025 --> 01:29:31,471
They watched with horror as Americans clamoured for more Greenbacks.

1163
01:29:31,472 --> 01:29:35,557
They may have killed Lincoln, but support for his monetary ideas grew.

1164
01:29:36,855 --> 01:29:41,868
On April 12, 1866, nearly one year to the day of Lincoln's assassination,

1165
01:29:42,068 --> 01:29:46,751
Congress went to work at the bidding of the European central-banking interests.

1166
01:29:47,364 --> 01:29:52,113
It passed the Contraction Act, authorizing the Secretary of the Treasury

1167
01:29:52,114 --> 01:29:57,181
to begin to retire the Greenbacks in circulation and to contract the money supply.

1168
01:30:00,331 --> 01:30:03,364
Authors Theodore R. Thoren and Richard F. Warner

1169
01:30:03,941 --> 01:30:08,967
explained the results of the money contraction in their book on the subject,

1170
01:30:09,229 --> 01:30:10,315
"The Truth in Money Book":

1171
01:30:13,014 --> 01:30:15,285
"The hard times which occurred after the Civil War

1172
01:30:15,286 --> 01:30:19,235
could have been avoided if the Greenback legislation had continued

1173
01:30:19,236 --> 01:30:21,270
as President Lincoln had intended.

1174
01:30:21,878 --> 01:30:26,887
Instead, there were a series of 'money panics' - what we call 'recessions'

1175
01:30:27,037 --> 01:30:29,919
which put pressure on Congress to enact legislation

1176
01:30:29,092 --> 01:30:32,161
to place the banking system under centralized control.

1177
01:30:34,333 --> 01:30:38,401
Eventually the Federal Reserve Act was passed on December 23, 1913."

1178
01:30:42,657 --> 01:30:45,930
In other words, the Money Changers wanted two things:

1179
01:30:45,931 --> 01:30:49,992
1) the re-institution of a central bank under their exclusive control,

1180
01:30:50,542 --> 01:30:53,547
and, 2) an American currency backed by their gold.

1181
01:30:54,806 --> 01:30:55,904
Their strategy was two-fold:

1182
01:30:56,792 --> 01:31:00,848
first, to cause a series of panics to try to convince the American people

1183
01:31:00,849 --> 01:31:05,912
that only centralized control of the money supply could provide economic stability;

1184
01:31:06,699 --> 01:31:09,756
and secondly, to remove so much money from the system

1185
01:31:09,757 --> 01:31:12,790
that most Americans would be so desperately poor

1186
01:31:13,377 --> 01:31:18,401
that they either wouldn't care or would be too weak to oppose the bankers.

1187
01:31:18,848 --> 01:31:22,920
In 1866, there was $1,8 billion in circulation in the United States

1188
01:31:25,894 --> 01:31:26,968
about $50.46 per capita.

1189
01:31:29,485 --> 01:31:33,557
In 1867 alone, $500 million was removed from the U.S. money supply.

1190
01:31:37,366 --> 01:31:40,404
Ten years later, in 1876, America's money supply

1191
01:31:41,535 --> 01:31:43,568
was reduced to only $600 million.

1192
01:31:44,062 --> 01:31:49,127
In other words, two-thirds of America's money had been called in by the bankers.

1193
01:31:50,811 --> 01:31:53,838
Only $14.60 per capita remained in circulation.

1194
01:31:55,685 --> 01:32:00,687
Ten years later, the money supply had been reduced to only $400 million,

1195
01:32:01,436 --> 01:32:03,499
even though the population had boomed.

1196
01:32:04,032 --> 01:32:08,093
The result was that only $6.67 per capita remained in circulation,

1197
01:32:11,047 --> 01:32:14,090
an 84% decline in buying power in just 20 years.

1198
01:32:17,626 --> 01:32:21,634
Today, economists try to sell the idea that recessions and depressions

1199
01:32:22,471 --> 01:32:26,509
are a natural part of something they call the "business cycle".

1200
01:32:26,944 --> 01:32:30,277
The truth is, our money supply is manipulated now,

1201
01:32:30,278 --> 01:32:33,309
just as it was before and after the Civil War.

1202
01:32:35,028 --> 01:32:36,415
How did this happen?

1203
01:32:36,416 --> 01:32:38,437
How did money become so scarce?

1204
01:32:39,706 --> 01:32:43,743
Simple - bank loans were called in and no new ones were given.

1205
01:32:44,914 --> 01:32:47,012
In addition, silver coins were melted down.

1206
01:32:48,777 --> 01:32:51,843
In 1872, a man named Ernest Seyd was given £100,000

1207
01:32:55,037 --> 01:32:56,105
(about $5,000,000 then)

1208
01:32:57,347 --> 01:33:00,742
by the Bank of England and sent to America to bribe

1209
01:33:00,743 --> 01:33:03,807
the necessary Congressmen to get silver "demonetised".

1210
01:33:05,521 --> 01:33:10,485
He was told that if this was not sufficient, to draw an additional £100,000,

1211
01:33:10,486 --> 01:33:12,530
"or as much more as was necessary"

1212
01:33:13,987 --> 01:33:17,066
The next year, Congress passed the Coinage Act of 1873

1213
01:33:18,635 --> 01:33:21,686
and the minting of silver dollars abruptly stopped.

1214
01:33:22,355 --> 01:33:26,410
In fact, Rep. Samuel Hooper, who introduced the bill in the House

1215
01:33:27,305 --> 01:33:31,310
acknowledged that Mr. Seyd actually drafted the legislation.

1216
01:33:33,488 --> 01:33:35,491
But it gets worse than that.

1217
01:33:35,554 --> 01:33:38,651
In 1874, Seyd himself admitted who was behind the scheme:

1218
01:34:07,077 --> 01:34:11,083
But the contest over control of America's money was not yet over.

1219
01:34:12,069 --> 01:34:14,096
Only three years later, in 1876,

1220
01:34:14,765 --> 01:34:17,776
with one-third of America's workforce unemployed,

1221
01:34:17,777 --> 01:34:19,823
the population was growing restless.

1222
01:34:20,897 --> 01:34:26,842
People were clamouring for a return to the Greenback money system of President Lincoln,

1223
01:34:26,843 --> 01:34:27,940
or a return to silver money

1224
01:34:29,033 --> 01:34:31,124
anything that would make money more plentiful.

1225
01:34:32,241 --> 01:34:37,249
That year, Congress created the United States Silver Commission to study the problem.

1226
01:34:38,011 --> 01:34:43,033
Their report clearly blamed the monetary contraction on the National Bankers.

1227
01:34:44,646 --> 01:34:47,402
The report is interesting because it compares

1228
01:34:47,403 --> 01:34:51,895
the deliberate money contraction by the National Bankers after the Civil War,

1229
01:34:51,896 --> 01:34:53,928
to the Fall of the Roman Empire.

1230
01:35:35,084 --> 01:35:39,092
Despite this report by the Silver Commission, Congress took no action.

1231
01:35:40,707 --> 01:35:44,751
The next year, 1877, riots broke out from Pittsburgh to Chicago.

1232
01:35:46,092 --> 01:35:49,124
The torches of starving vandals lit up the sky.

1233
01:35:49,636 --> 01:35:52,461
The bankers huddled to decide what to do.

1234
01:35:52,462 --> 01:35:53,536
They decided to hang on.

1235
01:35:54,758 --> 01:36:00,005
Now that they were back in control to a large extent they were not about to give it up.

1236
01:36:00,006 --> 01:36:02,902
At the meeting of the American Bankers Association that year,

1237
01:36:02,903 --> 01:36:06,838
they urged their membership to do everything in their power

1238
01:36:06,839 --> 01:36:09,888
to put down the notion of a return to Greenbacks.

1239
01:36:10,353 --> 01:36:14,627
The ABA Secretary, James Buel, authored a letter to the members

1240
01:36:14,628 --> 01:36:16,655
which blatantly called on the banks

1241
01:36:16,899 --> 01:36:19,908
to subvert not only Congress, but the press:

1242
01:37:04,839 --> 01:37:08,144
As political pressure mounted in Congress for change,

1243
01:37:08,145 --> 01:37:11,726
the press tried to turn the American people away from the truth.

1244
01:37:11,727 --> 01:37:15,734
The New York Tribune put it this way on January 10, 1878:

1245
01:37:17,562 --> 01:37:21,483
"The capital of the country organized at last, and we will see

1246
01:37:21,484 --> 01:37:24,516
whether Congress will dare to fly in its face."

1247
01:37:25,043 --> 01:37:27,046
But it didn't work entirely.

1248
01:37:27,312 --> 01:37:30,380
On February 28, 1878, Congress passed the Sherman Law

1249
01:37:32,679 --> 01:37:36,433
allowing the minting of a limited number of silver dollars,

1250
01:37:36,434 --> 01:37:37,502
ending a 5-year hiatus.

1251
01:37:38,832 --> 01:37:42,124
This did not end gold-backing of the currency, however.

1252
01:37:42,125 --> 01:37:44,164
Nor did it completely free silver.

1253
01:37:44,934 --> 01:37:48,959
Previous to 1873, anyone who brought silver to the U.S. mint

1254
01:37:49,939 --> 01:37:53,030
could have it struck into silver dollars free of charge.

1255
01:37:54,143 --> 01:37:54,218
No longer.

1256
01:37:55,981 --> 01:38:00,047
But at least some money began to flow back into the economy again.

1257
01:38:00,667 --> 01:38:05,425
With no further thread to their control, the bankers loosened up on loans

1258
01:38:05,426 --> 01:38:08,488
and the post-Civil War depression was finally ended.

1259
01:38:11,067 --> 01:38:12,079
Three years later,

1260
01:38:12,008 --> 01:38:15,955
the American people elected Republican James Garfield President.

1261
01:38:16,028 --> 01:38:19,675
Garfield understood how the economy was being manipulated.

1262
01:38:19,676 --> 01:38:23,155
As a Congressman, he had been chairman of the Appropriations Committee,

1263
01:38:23,156 --> 01:38:26,404
and was a member of the Banking and Currency Committee.

1264
01:38:26,405 --> 01:38:30,491
After his inauguration, he slammed the Money Changers publicly in 1881:

1265
01:38:54,932 --> 01:38:58,980
Within a few weeks of making this statement, on July 2 of 1881,

1266
01:39:01,014 --> 01:39:03,055
President Garfield was assassinated.

1267
01:39:08,661 --> 01:39:11,768
The Money Changers were gathering strength fast.

1268
01:39:11,769 --> 01:39:15,860
They began a periodic fleecing of the flock by creating economic booms,

1269
01:39:17,729 --> 01:39:19,708
followed by further depressions,

1270
01:39:19,709 --> 01:39:24,745
so they could buy up thousands of homes and farms for pennies on the dollar.

1271
01:39:25,165 --> 01:39:26,257
In 1891, the Money Changers

1272
01:39:27,507 --> 01:39:30,644
prepared to take the American economy down again

1273
01:39:30,645 --> 01:39:35,268
and their methods and motives were laid out with shocking clarity in a memo

1274
01:39:35,269 --> 01:39:38,273
sent out by the American Bankers Association

1275
01:39:39,875 --> 01:39:42,926
an organization in which most bankers were members.

1276
01:39:43,521 --> 01:39:48,587
Notice that this memo called for bankers to create a depression on a certain date

1277
01:39:49,488 --> 01:39:50,574
three years in the future.

1278
01:39:51,972 --> 01:39:56,039
According to the congressional record, here is how it read in part:

1279
01:40:26,808 --> 01:40:31,820
These depressions could be controlled because America was on the gold standard.

1280
01:40:31,821 --> 01:40:36,823
Since gold is scarce, it's one of the easiest commodities to manipulate.

1281
01:40:36,974 --> 01:40:40,285
People wanted silver money legalized again so they could escape

1282
01:40:40,286 --> 01:40:44,405
the stranglehold the Money Changers had on gold-backed money.

1283
01:40:44,406 --> 01:40:48,503
People wanted silver money reinstated, reversing Mr. Seyd's Act of 1873,

1284
01:40:51,022 --> 01:40:53,066
by then called the "Crime of '73".

1285
01:40:55,239 --> 01:40:58,696
By 1896, the issue of more silver money had become

1286
01:40:58,697 --> 01:41:01,719
the central issue in the Presidential campaign.

1287
01:41:02,526 --> 01:41:05,548
William Jennings Bryan, a Senator from Nebraska

1288
01:41:05,779 --> 01:41:09,793
ran for President as a Democrat on the "Free Silver" issue.

1289
01:41:10,299 --> 01:41:13,067
At the Democratic National Convention in Chicago,

1290
01:41:13,068 --> 01:41:14,166
he made an emotional speech,

1291
01:41:15,099 --> 01:41:20,113
which won him the nomination entitled "Crown of Thorns and Cross of Gold."

1292
01:41:21,184 --> 01:41:24,205
Though Bryan was only 36 years old at the time,

1293
01:41:24,206 --> 01:41:27,303
this speech is widely regarded as the most famous oration

1294
01:41:28,646 --> 01:41:30,721
ever made before a political convention.

1295
01:41:32,156 --> 01:41:34,225
In the dramatic conclusion, Bryan said:

1296
01:41:50,568 --> 01:41:54,824
The bankers lavishly supported the Republican candidate, William McKinley,

1297
01:41:54,825 --> 01:41:56,654
who favoured the gold standard.

1298
01:41:56,655 --> 01:42:00,147
The resulting contest was among the most fiercely contested

1299
01:42:00,148 --> 01:42:02,212
Presidential races in American history.

1300
01:42:02,973 --> 01:42:05,070
Bryan made over 600 speeches in 27 states.

1301
01:42:06,995 --> 01:42:10,450
The McKinley campaign got manufacturers and industrialists

1302
01:42:10,451 --> 01:42:13,257
to inform their employees that if Bryan were elected,

1303
01:42:13,258 --> 01:42:16,895
all factories and plants would close and there would be no work.

1304
01:42:16,896 --> 01:42:20,899
The ruse succeeded. McKinley beat Bryan by a small margin.

1305
01:42:22,867 --> 01:42:25,922
Bryan ran for president again in 1900 and in 1908,

1306
01:42:26,581 --> 01:42:27,589
but fell short each time.

1307
01:42:28,484 --> 01:42:31,026
During the 1912 Democratic Convention,

1308
01:42:31,027 --> 01:42:36,030
Bryan was a powerful figure who helped Woodrow Wilson win the nomination.

1309
01:42:36,576 --> 01:42:41,293
When Wilson became President he appointed Bryan as Secretary of State.

1310
01:42:41,294 --> 01:42:45,340
But Bryan soon became disenchanted with the Wilson administration.

1311
01:42:47,122 --> 01:42:50,681
Bryan served only two years in the Wilson administration

1312
01:42:50,682 --> 01:42:55,709
before resigning in 1915 over the highly suspicious sinking of the Lusitania,

1313
01:42:56,595 --> 01:43:00,614
the event which was used to drive America into World War I.

1314
01:43:01,165 --> 01:43:04,222
Although William Jennings Bryan never gained the Presidency,

1315
01:43:04,736 --> 01:43:08,447
his efforts delayed the Money Changers for seventeen years

1316
01:43:08,448 --> 01:43:10,449
from attaining their next goal

1317
01:43:10,757 --> 01:43:13,790
a new, privately-owned central bank for America.

1318
01:43:19,098 --> 01:43:23,036
Now it was time for the Money Changers to get back to the business

1319
01:43:23,919 --> 01:43:26,922
of a new, private central bank for America.

1320
01:43:27,805 --> 01:43:31,830
During the early 1900s, men like J.P. Morgan led the charge.

1321
01:43:32,271 --> 01:43:36,689
One final panic would be necessary to focus the nation's attention

1322
01:43:36,069 --> 01:43:38,154
on the supposed need for a central bank.

1323
01:43:40,422 --> 01:43:44,513
The rationale was that only a central bank could prevent bank failures.

1324
01:43:45,883 --> 01:43:48,957
Morgan was clearly the most powerful banker in America

1325
01:43:49,652 --> 01:43:51,744
and a suspected agent for the Rothschilds.

1326
01:43:53,371 --> 01:43:57,816
Morgan had helped finance John D. Rockefeller standard oil empire

1327
01:43:57,817 --> 01:44:02,648
he had also helped finance the monopolies of Edgar Herman in railroads,

1328
01:44:02,649 --> 01:44:06,654
of Andrew Carnegie in steel and of others in numerous industries.

1329
01:44:09,873 --> 01:44:13,926
But, on top of that, J.P. Morgan's father, Junius Morgan,

1330
01:44:13,927 --> 01:44:16,966
had been American financial agent to the British.

1331
01:44:17,598 --> 01:44:21,860
After his father's death, J.P. Morgan took on a British partner,

1332
01:44:21,861 --> 01:44:25,887
Edward Grenfell, a long-time director of the Bank of England.

1333
01:44:26,253 --> 01:44:31,296
In fact, upon Morgan's death, his estate contained only a few million dollars.

1334
01:44:32,151 --> 01:44:35,419
The bulk of the securities most people thought he owned,

1335
01:44:35,042 --> 01:44:37,051
were in fact owned by others.

1336
01:44:39,463 --> 01:44:44,512
In 1902, President Theodore Roosevelt allegedly went after Morgan and his friends

1337
01:44:44,513 --> 01:44:49,942
by using the Sherman Anti-Trust Act to try to break up their industrial monopolies.

1338
01:44:49,943 --> 01:44:54,596
Actually, Roosevelt did very little to interfere in the growing monopolization

1339
01:44:54,597 --> 01:44:58,272
of American industry by the bankers and their surrogates.

1340
01:44:58,273 --> 01:45:02,342
For example, Roosevelt supposedly broke up the Standard Oil monopoly.

1341
01:45:03,514 --> 01:45:05,522
But it wasn't really broken at all.

1342
01:45:05,523 --> 01:45:08,462
It was merely divided into seven corporations,

1343
01:45:08,463 --> 01:45:10,544
all still controlled by the Rockefellers.

1344
01:45:11,811 --> 01:45:15,638
The public was aware of this thanks to political cartoonists

1345
01:45:15,639 --> 01:45:19,700
like Thomas Nast who referred to the bankers as the "Money Trust."

1346
01:45:22,048 --> 01:45:25,127
By 1907, the year after Teddy Roosevelt's re-election,

1347
01:45:26,519 --> 01:45:30,538
Morgan decided it was time to try for a central bank again.

1348
01:45:31,073 --> 01:45:33,131
Using their combined financial muscle,

1349
01:45:33,848 --> 01:45:37,921
Morgan and his friends were secretly able to crash the stock market.

1350
01:45:38,958 --> 01:45:41,962
Thousands of small banks were vastly overextended.

1351
01:45:42,428 --> 01:45:45,026
Some had reserves of less than one percent (1%),

1352
01:45:45,027 --> 01:45:47,120
thanks to the fractional reserve principle.

1353
01:45:49,099 --> 01:45:53,103
Within days, banks runs were commonplace across the nation.

1354
01:45:53,506 --> 01:45:55,859
Now Morgan stepped into the public arena

1355
01:45:55,086 --> 01:45:58,298
and offered to prop up the faltering American economy

1356
01:45:59,073 --> 01:46:03,081
by supporting failing banks with money he manufactured out of nothing.

1357
01:46:04,965 --> 01:46:06,966
It was an outrageous proposal,

1358
01:46:07,225 --> 01:46:09,303
far worse than even fractional reserve banking,

1359
01:46:10,006 --> 01:46:11,103
but Congress let him do it.

1360
01:46:12,766 --> 01:46:14,824
Morgan manufactured $200 million worth

1361
01:46:15,876 --> 01:46:18,881
of this completely reserveless, private money

1362
01:46:19,289 --> 01:46:22,115
and bought things with it, paid for services with it,

1363
01:46:22,116 --> 01:46:26,175
and sent some of it to his branch banks to lend out at interest.

1364
01:46:27,891 --> 01:46:28,907
His plan worked.

1365
01:46:29,046 --> 01:46:32,305
Soon, the public regained confidence in money in general

1366
01:46:32,072 --> 01:46:34,100
and quit hoarding their currency.

1367
01:46:35,197 --> 01:46:38,931
But as a result, banking power was further consolidated

1368
01:46:38,932 --> 01:46:40,993
into the hands of a few large banks.

1369
01:46:42,283 --> 01:46:46,301
By 1908 the panic was over and Morgan was hailed as a hero

1370
01:46:46,683 --> 01:46:48,921
by the president of Princeton University,

1371
01:46:48,922 --> 01:46:50,983
a man by the name of Woodrow Wilson:

1372
01:47:04,613 --> 01:47:07,049
Economics textbooks would later explain

1373
01:47:07,005 --> 01:47:09,581
that the creation of the Federal Reserve System

1374
01:47:09,627 --> 01:47:12,635
was the direct result of the panic of 1907:

1375
01:47:13,501 --> 01:47:16,038
"with its alarming epidemic of bank failures,

1376
01:47:16,039 --> 01:47:18,324
the country was fed up once and for all

1377
01:47:18,325 --> 01:47:21,341
with the anarchy of unstable private banking."

1378
01:47:22,155 --> 01:47:25,241
But Minnesota Congressman Charles A. Lindbergh, Sr.,

1379
01:47:25,242 --> 01:47:27,938
the father of the famous aviator, "Lucky Lindy,"

1380
01:47:27,939 --> 01:47:31,976
later explained that the Panic of 1907 was really just a scam:

1381
01:47:48,345 --> 01:47:52,353
So, since the passage of the National Banking Act of 1863,

1382
01:47:52,585 --> 01:47:57,712
the Money Chnagers had been able to coordinate a series of booms and busts.

1383
01:47:57,713 --> 01:48:01,672
The purpose was not only to fleece the American public of their property,

1384
01:48:01,673 --> 01:48:05,999
but to later to claim that the banking system was basically so unstable

1385
01:48:06,000 --> 01:48:10,037
that it had to be consolidated into a central bank once again.

1386
01:48:15,678 --> 01:48:19,745
After the crash, Teddy Roosevelt, in response to the Panic of 1907,

1387
01:48:20,927 --> 01:48:23,960
signed into law a bill creating something called

1388
01:48:24,347 --> 01:48:26,370
the National Monetary Commission.

1389
01:48:27,296 --> 01:48:29,383
The Commission was to study the banking problem

1390
01:48:30,167 --> 01:48:32,662
and make recommendations to Congress.

1391
01:48:32,663 --> 01:48:36,754
Of course, the Commission was packed with Morgan's friends and cronies.

1392
01:48:38,955 --> 01:48:43,380
The Chairman was a man named Senator Nelson Aldrich from Rhode Island.

1393
01:48:43,381 --> 01:48:46,147
Aldrich represented the Newport, Rhode Island homes

1394
01:48:46,148 --> 01:48:48,211
of America's richest banking families.

1395
01:48:49,038 --> 01:48:54,283
His daughter married John D. Rockefeller, Jr., and together they had five sons:

1396
01:48:54,284 --> 01:48:58,293
John, Nelson (who would become the Vice-President in 1974),

1397
01:48:59,184 --> 01:49:00,283
Laurence, Winthrop, and David

1398
01:49:02,133 --> 01:49:04,601
(the head of the Council on Foreign Relations

1399
01:49:04,602 --> 01:49:07,603
and former Chairman of Chase Manhattan bank).

1400
01:49:09,042 --> 01:49:12,238
As soon as the National Monetary Commission was set up,

1401
01:49:12,617 --> 01:49:16,673
Senator Aldrich immediately embarked on a two-year tour of Europe,

1402
01:49:17,296 --> 01:49:20,685
where he consulted at length with the private central bankers

1403
01:49:20,686 --> 01:49:22,702
in England, France and Germany.

1404
01:49:23,156 --> 01:49:27,198
The total cost of his trip alone to the taxpayers was $300,000

1405
01:49:28,261 --> 01:49:30,300
an astronomical sum in those days.

1406
01:49:31,738 --> 01:49:35,770
Shortly after his return, on the evening of November 22, 1910,

1407
01:49:36,522 --> 01:49:39,523
some of the wealthiest and most powerful men in America

1408
01:49:39,524 --> 01:49:41,616
boarded Senator Aldrich's private rail car

1409
01:49:42,487 --> 01:49:45,555
and in the strictest secrecy journeyed to this place,

1410
01:49:46,751 --> 01:49:48,759
Jekyll Island, off the coast of Georgia.

1411
01:49:50,523 --> 01:49:52,827
With the group came Paul Warburg.

1412
01:49:52,828 --> 01:49:55,877
Warburg had been given a $500,000 per year salary

1413
01:49:57,666 --> 01:50:01,750
to lobby for the passage of a privately-owned central bank in America

1414
01:50:02,566 --> 01:50:05,567
by the investment firm, Kuhn, Loeb & Company.

1415
01:50:06,442 --> 01:50:10,467
Warburg's partner in this firm was a man named Jacob Schiff,

1416
01:50:10,726 --> 01:50:13,637
the grandson of the man who shared the Green Shield house

1417
01:50:13,638 --> 01:50:15,713
with the Rothschild family in Frankfort.

1418
01:50:16,728 --> 01:50:21,870
Schiff, as we'll later find out, was in the process of spending $20 million

1419
01:50:21,871 --> 01:50:24,903
to finance the overthrow of the Tsar of Russia.

1420
01:50:27,061 --> 01:50:32,476
These three European banking families, the Rothschilds, the Warburgs, and the Schiffs

1421
01:50:32,477 --> 01:50:36,074
were interconnected by marriage down through the years,

1422
01:50:36,075 --> 01:50:38,999
just as were their American banking counterparts,

1423
01:50:39,000 --> 01:50:41,064
the Morgans, Rockefellers and Aldrichs.

1424
01:50:43,397 --> 01:50:47,483
Secrecy was so tight that all seven primary participants were cautioned

1425
01:50:48,753 --> 01:50:53,768
to use only first names to prevent servants from learning their identities.

1426
01:50:54,497 --> 01:50:57,502
Years later one participant, Frank Vanderlip,

1427
01:50:57,901 --> 01:51:00,229
president of National City Bank of New York

1428
01:51:00,023 --> 01:51:05,068
and a representative of the Rockefeller family, confirmed the Jekyll Island trip

1429
01:51:05,276 --> 01:51:09,302
in the February 9, 1935 edition of the Saturday Evening Post:

1430
01:51:34,324 --> 01:51:39,146
The participants came here to figure out how to solve their major problem

1431
01:51:39,147 --> 01:51:42,185
how to bring back a privately-owned central bank

1432
01:51:43,045 --> 01:51:47,074
but there were other problems that needed to be addressed as well.

1433
01:51:47,336 --> 01:51:52,544
First of all, the market share of the big national banks was shrinking fast.

1434
01:51:52,545 --> 01:51:54,574
In the first ten years of the century,

1435
01:51:54,575 --> 01:51:58,622
the number of U.S. banks had more than doubled to over 20,000.

1436
01:52:00,637 --> 01:52:03,692
By 1913, only 29% of all banks were National Banks

1437
01:52:06,747 --> 01:52:08,826
and they held only 57% of all deposits.

1438
01:52:11,421 --> 01:52:14,507
As Senator Aldrich later admitted in a magazine article:

1439
01:52:28,969 --> 01:52:34,491
Therefore, something had to be done to bring these new banks under their control.

1440
01:52:34,492 --> 01:52:37,565
As John D. Rockefeller put it: "Competition is a sin"

1441
01:52:40,908 --> 01:52:43,993
Secondly, the nation's economy was so strong

1442
01:52:43,994 --> 01:52:48,858
that corporations were starting to finance their expansions out of profits

1443
01:52:48,859 --> 01:52:51,864
instead of taking out huge loans from large banks.

1444
01:52:53,118 --> 01:52:55,629
In the first 10 years of the new century,

1445
01:52:55,063 --> 01:52:57,161
70% of corporate funding came from profits.

1446
01:52:59,821 --> 01:53:04,872
In other words, American industry was becoming independent of the Money Changers,

1447
01:53:05,371 --> 01:53:07,409
and that trend had to be stopped.

1448
01:53:09,401 --> 01:53:11,143
All the participants knew

1449
01:53:11,144 --> 01:53:15,206
that these problems could be hammered out into a workable solution,

1450
01:53:15,922 --> 01:53:19,951
but perhaps their biggest problem was a public relations problem,

1451
01:53:20,213 --> 01:53:22,251
the name of the new central bank.

1452
01:53:22,067 --> 01:53:25,198
That discussion took place right here in this room,

1453
01:53:25,802 --> 01:53:29,279
one of the many conference rooms in this sprawling hotel

1454
01:53:29,028 --> 01:53:32,037
today known as the Jekyll Island Club Hotel.

1455
01:53:34,493 --> 01:53:39,278
Aldrich believed that the word "bank" should not even appear in the name.

1456
01:53:39,279 --> 01:53:41,526
Warburg wanted to call the legislation

1457
01:53:41,527 --> 01:53:44,601
the National Reserve Bill or the Federal Reserve Bill.

1458
01:53:45,818 --> 01:53:50,496
The idea here was to give the impression that the purpose of the new central bank

1459
01:53:50,497 --> 01:53:54,558
was to stop bank runs, but also to conceal its monopoly character.

1460
01:53:56,459 --> 01:53:59,494
However, it was Aldrich, the egotistical politician,

1461
01:53:59,081 --> 01:54:02,084
who insisted it be called the Aldrich Bill.

1462
01:54:04,071 --> 01:54:07,145
After nine days at Jekyll Island, the group dispersed.

1463
01:54:07,991 --> 01:54:12,912
The new central bank would be very similar to the old Bank of the United States.

1464
01:54:12,913 --> 01:54:15,010
It would eventually be given a monopoly over U.S. currency

1465
01:54:15,884 --> 01:54:17,946
and create that money out of nothing.

1466
01:54:19,164 --> 01:54:22,113
How does the Fed "create" money out of nothing?

1467
01:54:22,114 --> 01:54:25,197
It is a four-step process. But first a word on bonds.

1468
01:54:26,148 --> 01:54:29,222
Bonds are simply promises to pay - or government IOUs.

1469
01:54:30,423 --> 01:54:33,551
People buy bonds to get a secure rate of interest.

1470
01:54:33,552 --> 01:54:37,677
At the end of the term of the bond, the government repays the bond, plus interest,

1471
01:54:37,678 --> 01:54:38,764
and the bond is destroyed.

1472
01:54:39,678 --> 01:54:43,762
There are about 3.6 trillion dollars worth of these bonds at present.

1473
01:54:45,444 --> 01:54:47,452
Now here is the Fed moneymaking process:

1474
01:54:48,924 --> 01:54:51,945
Step 1. The Fed Open Market Committee approves

1475
01:54:52,383 --> 01:54:55,305
the purchase of U.S. Bonds on the open market.

1476
01:54:55,306 --> 01:54:58,401
Step 2. The bonds are purchased by the Fed Bank

1477
01:54:58,402 --> 01:55:02,407
from whoever is offering them for sale on the open market.

1478
01:55:02,408 --> 01:55:07,893
Step 3. The Fed pays for the bonds with electronic credits to the seller's bank,

1479
01:55:07,894 --> 01:55:10,947
which in turn credits the seller's bank account.

1480
01:55:10,948 --> 01:55:15,954
The trick is that these credits are based on nothing. The Fed just creates them.

1481
01:55:17,935 --> 01:55:20,979
Step 4. The banks use these deposits as reserves.

1482
01:55:21,972 --> 01:55:25,515
They can loan out over ten times the amount of their reserves

1483
01:55:25,516 --> 01:55:27,555
to new borrowers, all at interest.

1484
01:55:30,526 --> 01:55:35,160
In this way, a Fed purchase of, say a million dollars worth of bonds,

1485
01:55:35,161 --> 01:55:39,164
gets turned into over 10 million dollars in bank accounts.

1486
01:55:39,611 --> 01:55:43,613
The Fed, in effect, creates 10% of this totally new money

1487
01:55:43,719 --> 01:55:45,724
and the banks create the other 90%.

1488
01:55:46,757 --> 01:55:50,809
To reduce the amount of money in the economy, the process is just reversed:

1489
01:55:51,278 --> 01:55:57,278
the Fed sells bonds to the public, and money flows out of the purchaser's local bank.

1490
01:55:57,446 --> 01:56:01,459
Loans must be reduced by ten times the amount of the sale.

1491
01:56:01,904 --> 01:56:04,923
So a Fed sale of a million dollars in bonds,

1492
01:56:05,579 --> 01:56:08,670
results in 10 million dollars less money in the economy.

1493
01:56:10,451 --> 01:56:15,525
So how does this benefit the bankers whose representatives huddled at Jekyll Island?

1494
01:56:16,857 --> 01:56:21,526
1st - it totally misdirected banking reform efforts from proper solutions.

1495
01:56:21,527 --> 01:56:25,320
2nd - it prevented a proper, debt-free system of government finance

1496
01:56:25,321 --> 01:56:28,556
like Lincoln's Greenbacks - from making a comeback.

1497
01:56:28,557 --> 01:56:30,693
The bond-based system of government finance,

1498
01:56:30,694 --> 01:56:33,197
forced on Lincoln after he created Greenbacks,

1499
01:56:33,198 --> 01:56:34,260
was now cast in stone.

1500
01:56:35,053 --> 01:56:40,000
3rd - it delegated to the bankers the right to create 90% of our money supply

1501
01:56:40,478 --> 01:56:42,506
based on only fractional reserves

1502
01:56:42,795 --> 01:56:45,707
which they could then loan out at interest.

1503
01:56:45,708 --> 01:56:49,670
4th - it centralized overall control of our nation's money supply

1504
01:56:49,671 --> 01:56:50,767
in the hands of a few men.

1505
01:56:51,895 --> 01:56:55,938
5th - it established a central bank with a high degree of independence

1506
01:56:55,939 --> 01:56:57,962
from effective political control.

1507
01:56:58,626 --> 01:57:03,478
Soon after its creation, the Fed's Great Contraction in the early 1930s

1508
01:57:03,479 --> 01:57:05,542
would cause the Great Depression.

1509
01:57:05,543 --> 01:57:09,630
This independence has been enhanced since then, through additional laws.

1510
01:57:11,122 --> 01:57:14,650
In order to fool the public into thinking the government retained control,

1511
01:57:14,651 --> 01:57:18,455
the plan called for the Fed to be run by a Board of Governors

1512
01:57:18,456 --> 01:57:21,500
appointed by the President and approved by the Senate.

1513
01:57:21,501 --> 01:57:24,699
But all the bankers had to do was to be sure that their men

1514
01:57:24,007 --> 01:57:25,682
got appointed to the Board of Governors.

1515
01:57:26,376 --> 01:57:31,381
That wasn't hard. Bankers have money, and money buys influence over politicians.

1516
01:57:32,092 --> 01:57:37,113
Once the participants left Jekyll Island, the public relations blitz was on.

1517
01:57:38,523 --> 01:57:42,301
The big New York banks put together an "educational" fund

1518
01:57:42,302 --> 01:57:45,303
of five million dollars to finance professors

1519
01:57:45,456 --> 01:57:48,501
at respected universities to endorse the new bank.

1520
01:57:49,819 --> 01:57:54,838
Woodrow Wilson at Princeton was one of the first to jump on the bandwagon.

1521
01:57:55,152 --> 01:57:57,160
But the bankers' subterfuge didn't work.

1522
01:57:58,089 --> 01:58:02,098
The Aldrich Bill was quickly identified as the bankers bill

1523
01:58:02,489 --> 01:58:06,526
a bill to benefit only what become known as the "Money Trust."

1524
01:58:06,996 --> 01:58:11,030
As Congressman Lindbergh put it during the Congressional debate:

1525
01:58:26,098 --> 01:58:29,590
Seeing they didn't have the votes to win in Congress,

1526
01:58:30,473 --> 01:58:34,535
the Republican leadership never brought the Aldrich Bill to a vote.

1527
01:58:35,226 --> 01:58:40,253
The bankers quietly decided to move to track two, the Democratic alternative.

1528
01:58:41,826 --> 01:58:45,848
They began financing Woodrow Wilson as the Democratic nominee.

1529
01:58:46,382 --> 01:58:49,386
As respected historian James Perloff put it,

1530
01:58:49,861 --> 01:58:54,893
Wall Street financier Bernard Baruch was put in charge of Wilson's education:

1531
01:59:12,256 --> 01:59:16,334
So now, the stage was set. The Money Changers were poised to install

1532
01:59:17,792 --> 01:59:20,744
their privately-owned central bank once again.

1533
01:59:20,745 --> 01:59:24,688
The damage president Andrew Jackson had done 67 years earlier

1534
01:59:24,689 --> 01:59:26,693
had been only partly repaired

1535
01:59:26,085 --> 01:59:30,377
with the passage of the national bank act during the civil war.

1536
01:59:31,143 --> 01:59:34,228
Since then, the battle had raged on across the decades.

1537
01:59:35,263 --> 01:59:37,738
The "Jacksonians" became the "Greebackers"

1538
01:59:37,739 --> 01:59:41,766
who became the hard-core supporters of William Jennings Bryan.

1539
01:59:42,067 --> 01:59:45,952
With Bryan leading the charge, these opponents of the Money Changers,

1540
01:59:46,556 --> 01:59:51,613
ignorant of Baruch's tutelage, now threw themselves behind democrat Widrow Wilson.

1541
01:59:52,434 --> 01:59:54,502
They and Bryan would soon be betrayed.

1542
02:00:00,633 --> 02:00:01,726
During the Presidential campaign,

1543
02:00:02,564 --> 02:00:06,851
the Democrats were careful to pretend to oppose the Aldrich Bill.

1544
02:00:06,852 --> 02:00:10,884
As Rep. Louis McFadden, himself a Democrat as well as chairman

1545
02:00:11,951 --> 02:00:17,018
of the House Banking and Currency Committee, explained it 20 years after the fact:

1546
02:00:54,851 --> 02:00:56,932
Once Wilson was elected, Morgan, Warburg,

1547
02:00:57,078 --> 02:00:59,164
Baruch and company advanced a "new" plan,

1548
02:01:01,377 --> 02:01:04,399
which Warburg named the Federal Reserve System.

1549
02:01:05,321 --> 02:01:10,183
The Democratic leadership hailed the new bill, called the Glass-Owen Bill,

1550
02:01:10,184 --> 02:01:13,231
as something radically different from the Aldrich Bill.

1551
02:01:13,655 --> 02:01:17,752
But in fact, the bill was virtually identical in every important detail.

1552
02:01:19,027 --> 02:01:22,076
In fact, so vehement were the Democratic denials of similarity

1553
02:01:22,518 --> 02:01:25,016
that Paul Warburg - the father of both bills –

1554
02:01:25,017 --> 02:01:28,026
had to step in to reassure his paid friends in Congress

1555
02:01:29,191 --> 02:01:32,195
that the two bills were virtually identical:

1556
02:01:43,948 --> 02:01:47,423
But that admission was for private consumption only.

1557
02:01:47,424 --> 02:01:51,823
Publicly, the Money Trust trotted out Senator Aldrich and Frank Vanderlip,

1558
02:01:51,824 --> 02:01:55,787
the president of Rockefeller's National City Bank of New York

1559
02:01:55,788 --> 02:01:58,174
and one of the Jekyll Island seven,

1560
02:01:58,175 --> 02:02:00,748
to oppose the new Federal Reserve System.

1561
02:02:00,749 --> 02:02:04,562
Years later, however, Vanderlip admitted in the Saturday Evening Post

1562
02:02:04,563 --> 02:02:07,585
that the two measures were virtually identical:

1563
02:02:21,753 --> 02:02:26,797
As Congress neared a vote, they called Ohio attorney Alfred Crozier to testify.

1564
02:02:27,687 --> 02:02:32,692
Crozier noted the similarities between the Aldrich Bill and the Glass-Owen Bill:

1565
02:03:03,767 --> 02:03:05,722
During the debate on the measure,

1566
02:03:05,723 --> 02:03:09,937
Senators complained that the big banks were using their financial muscle

1567
02:03:09,938 --> 02:03:11,592
to influence the outcome.

1568
02:03:11,593 --> 02:03:15,319
"There are bankers in this country who are enemies of the public welfare,"

1569
02:03:15,032 --> 02:03:17,113
sayd one Senator. What an understatement!

1570
02:03:18,629 --> 02:03:21,346
Despite the charges of deceit and corruption,

1571
02:03:21,347 --> 02:03:25,420
the bill was finally rammed through the Senate on December 22, 1913,

1572
02:03:27,004 --> 02:03:30,158
after must Senators had left town for the Holidays,

1573
02:03:30,159 --> 02:03:33,783
after having been assured by the leadership that nothing would be done

1574
02:03:33,784 --> 02:03:35,847
until long after the Christmas recess.

1575
02:03:36,803 --> 02:03:40,212
On the day the bill was passed, Congressman Lindbergh

1576
02:03:40,213 --> 02:03:42,289
prophetically warned his countrymen that:

1577
02:04:08,593 --> 02:04:10,672
On top of all this, only weeks earlier,

1578
02:04:11,492 --> 02:04:14,584
Congress had finally passed a bill legalizing income tax.

1579
02:04:16,141 --> 02:04:18,416
Why was the income tax law important?

1580
02:04:18,417 --> 02:04:21,533
Because bankers finally had in place a system

1581
02:04:21,534 --> 02:04:24,608
which would run up a virtually unlimited federal debt.

1582
02:04:25,596 --> 02:04:29,701
How would the interest on this debt be repaid, never mind the principal?

1583
02:04:29,702 --> 02:04:34,735
Remember, a privately-owned central bank creates the principal out of nothing.

1584
02:04:35,005 --> 02:04:37,597
The federal government was small then.

1585
02:04:38,093 --> 02:04:42,142
Up to then, it had subsisted merely on tariffs and excise taxes.

1586
02:04:43,777 --> 02:04:45,815
Just as with the Bank of England,

1587
02:04:46,197 --> 02:04:51,223
the interest payments had to be guaranteed by direct taxation of the people.

1588
02:04:51,655 --> 02:04:54,736
The Money Changers knew that if they had to rely

1589
02:04:54,737 --> 02:04:56,705
on contributions from the states,

1590
02:04:56,706 --> 02:05:00,450
eventually the individual state legislatures would revolt

1591
02:05:00,451 --> 02:05:03,080
and either refuse to pay the interest on their own money,

1592
02:05:03,081 --> 02:05:07,159
or at least bring political pressure to bear to keep the debt small.

1593
02:05:08,846 --> 02:05:12,253
It is interesting to note that in 1895 the Supreme Court

1594
02:05:12,254 --> 02:05:16,257
had found a similar income tax law to be unconstitutional.

1595
02:05:16,602 --> 02:05:21,658
The Supreme Court even found a corporate income tax law unconstitutional in 1909.

1596
02:05:23,025 --> 02:05:26,028
As a result, Senator Aldrich hustled a bill

1597
02:05:26,219 --> 02:05:30,306
for a constitutional amendment allowing income tax through the Congress.

1598
02:05:31,264 --> 02:05:33,917
The proposed 16th Amendment to the Constitution

1599
02:05:33,918 --> 02:05:36,986
was then sent to the state legislatures for approval,

1600
02:05:37,754 --> 02:05:41,759
but some critics claim that the 16th Amendment was never ratified

1601
02:05:42,637 --> 02:05:44,698
by the necessary 3/4s of the states.

1602
02:05:45,297 --> 02:05:48,364
In other words, the 16th Amendment may not be legal.

1603
02:05:49,094 --> 02:05:52,617
But the Money Changers were in no mood to debate the fine points.

1604
02:05:53,464 --> 02:05:58,549
By October of 1913, senator Aldrich had hustled the income tax bill through Congress.

1605
02:05:59,005 --> 02:06:02,981
Without the power to tax the people directly and bypass the states,

1606
02:06:03,477 --> 02:06:06,916
the Federal Reserve Bill would be far less useful to those

1607
02:06:06,917 --> 02:06:09,973
who wanted to drive America deeply into their debt.

1608
02:06:11,091 --> 02:06:14,097
A year after the passage of the Federal Reserve Bill,

1609
02:06:14,971 --> 02:06:18,017
Congressman Lindbergh explained how the Fed created

1610
02:06:18,487 --> 02:06:21,478
what we have come to call the "Business Cycle"

1611
02:06:21,479 --> 02:06:23,558
and how they use it to their advantage:

1612
02:07:40,954 --> 02:07:43,761
Congressman Lindbergh was correct on all points.

1613
02:07:43,762 --> 02:07:46,813
What he didn't realize was that most European nations

1614
02:07:46,814 --> 02:07:51,835
had already fallen prey to the central bankers decades or centuries earlier.

1615
02:07:52,664 --> 02:07:56,586
But he also mentions the interesting fact that only one year later,

1616
02:07:56,587 --> 02:08:00,640
the Fed had cornered the market in gold; this is how he put it:

1617
02:08:01,177 --> 02:08:06,240
"Already the Federal Reserve banks have cornered the gold and gold certificates..."

1618
02:08:07,808 --> 02:08:11,834
But Congressman Lindbergh was not the only critic of the Fed.

1619
02:08:12,443 --> 02:08:14,809
Congressman Louis McFadden, the Chairman

1620
02:08:14,081 --> 02:08:18,107
of the House Banking and Currency committee from 1920 to 1931

1621
02:08:19,588 --> 02:08:22,645
remarked that the Federal Reserve Act brought about:

1622
02:08:34,555 --> 02:08:37,701
Notice how McFadden saw the international character

1623
02:08:37,702 --> 02:08:39,800
of the stockholders of the Federal Reserve.

1624
02:08:41,025 --> 02:08:44,890
Another chairman of the House Banking and Currency Committee in the 1960s,

1625
02:08:44,891 --> 02:08:46,988
Wright Patman from Texas, put it this way:

1626
02:09:09,066 --> 02:09:12,257
Even the inventor of the electric light, Thomas Edison,

1627
02:09:12,852 --> 02:09:16,857
joined the fray in criticizing the system of the Federal Reserve:

1628
02:09:57,661 --> 02:10:00,443
Three years after the passage of the Federal Reserve Act,

1629
02:10:00,444 --> 02:10:03,390
even President Wilson began to have second thoughts

1630
02:10:03,391 --> 02:10:07,423
about what had been unleashed during his first term in office.

1631
02:10:52,816 --> 02:10:55,867
Before his death in 1924, President Wilson realized

1632
02:10:56,432 --> 02:11:00,169
the full extent of the damage he had done to America, when he confessed:

1633
02:11:00,017 --> 02:11:02,104
"I have unwittingly ruined my government."

1634
02:11:04,431 --> 02:11:06,447
So finally, the Money Changers,

1635
02:11:06,069 --> 02:11:10,591
those who profit by manipulating the amount of money in circulation,

1636
02:11:11,213 --> 02:11:15,264
had their privately owned central bank installed again in America.

1637
02:11:16,851 --> 02:11:19,379
The major newspapers (which they also owned)

1638
02:11:19,038 --> 02:11:24,020
hailed passage of the Federal Reserve Act of 1913, telling the public that

1639
02:11:24,363 --> 02:11:27,659
"now depressions could be scientifically prevented."

1640
02:11:27,066 --> 02:11:32,071
The fact of the matter was that now depressions could be scientifically created.

1641
02:11:37,442 --> 02:11:40,779
Power was now centralized to a tremendous extent.

1642
02:11:40,078 --> 02:11:45,124
Now it was time for a war - a really big war - in fact, the first World War.

1643
02:11:47,055 --> 02:11:48,878
Of course, to the central banker,

1644
02:11:48,879 --> 02:11:54,421
the political issues of war don't matter nearly as much as the profit potential,

1645
02:11:54,422 --> 02:11:56,491
and nothing creates debts like warfare.

1646
02:11:58,159 --> 02:12:01,296
England was the best example up to that time.

1647
02:12:01,297 --> 02:12:05,624
During the 119-year period between the founding of the Bank of England

1648
02:12:05,625 --> 02:12:07,664
and Napoleon's defeat at Waterloo,

1649
02:12:08,034 --> 02:12:10,101
England had been at war for 56 years.

1650
02:12:11,449 --> 02:12:15,480
And much of the remaining time, she'd been preparing for war.

1651
02:12:15,923 --> 02:12:19,946
In World War I, the German Rothschilds loaned money to the Germans,

1652
02:12:19,947 --> 02:12:22,378
the British Rothschilds loaned money to the British,

1653
02:12:22,379 --> 02:12:25,473
and the French Rothschilds loaned money to the French.

1654
02:12:25,474 --> 02:12:29,255
In America, J.P. Morgan was the sales agent for war materials

1655
02:12:29,256 --> 02:12:31,613
to both the British and the French.

1656
02:12:31,614 --> 02:12:36,765
In fact, six months into the war, Morgan became the largest consumer on earth,

1657
02:12:36,766 --> 02:12:37,858
spending $10 million a day.

1658
02:12:39,099 --> 02:12:41,108
His offices at 23 Wall Street

1659
02:12:42,347 --> 02:12:46,151
were mobbed by brokers and salesmen trying to cut a deal.

1660
02:12:46,152 --> 02:12:51,024
In fact, it got so bad that the bank had to post guards at every door

1661
02:12:51,025 --> 02:12:53,030
and at the partners' homes as well.

1662
02:12:54,566 --> 02:12:58,590
Many of the New York bankers made out as well from the war.

1663
02:13:00,076 --> 02:13:05,077
President Wilson appointed Bernard Baruch to head the War Industries Board.

1664
02:13:05,224 --> 02:13:09,863
According to historian Jarnes Perloff, both Baruch and the Rockefellers

1665
02:13:09,864 --> 02:13:12,879
profited by some $200 million during the war.

1666
02:13:14,324 --> 02:13:18,350
But profits were not the only motive. There was also revenge.

1667
02:13:18,717 --> 02:13:21,180
The Money Changers never forgave the Tsars

1668
02:13:21,181 --> 02:13:23,830
for their support of Lincoln during the Civil War.

1669
02:13:23,831 --> 02:13:26,858
Also, Russia was the last major European nation

1670
02:13:27,924 --> 02:13:31,973
to refuse to give in to the privately owned central bank scheme.

1671
02:13:33,581 --> 02:13:35,882
Three years after World War I broke out,

1672
02:13:35,883 --> 02:13:40,922
the Russian Revolution toppled the Tsar and installed the scourge of communism.

1673
02:13:41,394 --> 02:13:44,483
Jacob Schiff of Kuhn, Loeb & Co. bragged on his deathbed

1674
02:13:45,285 --> 02:13:49,316
that he had spent $20 million towards the defeat of the Tsar.

1675
02:13:52,685 --> 02:13:56,747
Money was funnelled from England to support the revolution as well.

1676
02:13:57,825 --> 02:14:02,839
Why would some of the richest men in the world financially back communism,

1677
02:14:03,152 --> 02:14:07,231
the system that was openly vowing to destroy the so-called capitalism

1678
02:14:08,067 --> 02:14:09,130
that made them wealthy?

1679
02:14:09,909 --> 02:14:12,942
Researcher Gary Allen explained it was this way:

1680
02:14:46,766 --> 02:14:50,838
As W. Cleon Skousen put it in his 1970 book "The Naked Capitalist":

1681
02:15:22,197 --> 02:15:25,212
But what if these revolutionaries get out of control

1682
02:15:25,213 --> 02:15:27,875
and try to seize power from the super rich?

1683
02:15:27,876 --> 02:15:32,862
After all, it was Mao Tse Tung who in 1938 stated his position concerning power:

1684
02:15:32,863 --> 02:15:35,924
"Political power grows out of the barrel of a gun."

1685
02:15:36,502 --> 02:15:39,575
The Wall Street/London axis elected to take the risk.

1686
02:15:40,735 --> 02:15:45,149
The master-planners attempted to control revolutionary communist groups

1687
02:15:45,015 --> 02:15:48,287
by feeding them vast quantities of money when they obeyed,

1688
02:15:48,423 --> 02:15:52,497
and contracting their money supply, or even financing their opposition,

1689
02:15:52,498 --> 02:15:53,595
if they got out of control.

1690
02:15:55,098 --> 02:15:56,991
Lenin began to understand that

1691
02:15:56,992 --> 02:16:00,935
although he was the absolute dictator of the new Soviet Union,

1692
02:16:00,936 --> 02:16:03,022
he was not pulling the financial strings;

1693
02:16:04,029 --> 02:16:06,086
someone else was silently in control:

1694
02:16:33,803 --> 02:16:35,049
Who was behind it?

1695
02:16:35,049 --> 02:16:38,395
Rep. Louis T. McFadden, the Chairman of the House Banking

1696
02:16:38,396 --> 02:16:41,207
and Currency Committee throughout the 1920s

1697
02:16:41,208 --> 02:16:46,227
and into the Great Depression years of the 1930s, explained it this way:

1698
02:17:20,466 --> 02:17:23,509
In other words, the Fed and the Bank of England,

1699
02:17:24,326 --> 02:17:28,034
at the behest of the international bankers who controlled them,

1700
02:17:28,035 --> 02:17:32,044
were creating a monster, one which would fuel seven decades

1701
02:17:33,549 --> 02:17:38,555
of unprecedented Communist revolution, warfare, and most importantly - debt.

1702
02:17:41,608 --> 02:17:44,906
In case you think there is some chance that the Money Changers

1703
02:17:44,906 --> 02:17:46,998
got communism going and then lost control,

1704
02:17:48,023 --> 02:17:53,124
in 1992, The Washington Times reported that Russian President Boris Jeltsin

1705
02:17:53,493 --> 02:17:58,356
was upset that most of the incoming foreign aid was being siphoned off

1706
02:17:58,357 --> 02:18:02,916
"straight back into the coffers of Western banks in debt service."

1707
02:18:04,369 --> 02:18:09,397
No one in his right mind, would claim that a war as large as World War I

1708
02:18:09,398 --> 02:18:14,369
had a single cause. Wars are complex things with many causative factors.

1709
02:18:15,564 --> 02:18:18,415
But on the other hand it would also be equally foolish

1710
02:18:18,416 --> 02:18:24,057
to ignore as a prime cause of WWI those who would profit the most from the war.

1711
02:18:24,731 --> 02:18:28,733
The role of the Money Changers is no wild conspiracy theory.

1712
02:18:29,215 --> 02:18:33,004
They had a motive - a short-range, self-serving motive

1713
02:18:34,311 --> 02:18:39,537
as well as a long-range, political motive of advancing totalitarian government,

1714
02:18:39,538 --> 02:18:42,802
with the Money Changers maintaining the financial clout

1715
02:18:42,803 --> 02:18:46,804
to control whatever politicians might emerge as the leaders.

1716
02:18:47,076 --> 02:18:52,797
Next, we'll see what the Money Changers' ultimate political goal is for the world.

1717
02:18:58,325 --> 02:19:01,546
Shortly after WWI, the overall political agenda

1718
02:19:02,074 --> 02:19:04,159
of the Money Changers began to be clear.

1719
02:19:05,519 --> 02:19:09,183
Now that they controlled national economies individually,

1720
02:19:09,184 --> 02:19:12,736
the next step was the ultimate form of consolidation:

1721
02:19:12,737 --> 02:19:13,754
world government.

1722
02:19:14,928 --> 02:19:18,249
The new world government proposal was given top priority

1723
02:19:18,025 --> 02:19:20,824
at the Paris peace conference after WWI.

1724
02:19:21,137 --> 02:19:23,625
It was called the League of Nations.

1725
02:19:23,626 --> 02:19:26,632
But much to the surprise of Paul Warburg and Bernard Baruch,

1726
02:19:27,227 --> 02:19:30,119
who attended the peace conference with president Wilson,

1727
02:19:30,012 --> 02:19:33,844
the world was not yet ready to dissolve national boundaries.

1728
02:19:33,954 --> 02:19:37,005
Nationalism still beats strong in the human breast.

1729
02:19:37,671 --> 02:19:41,375
For example, Lord Curzon, the British foreign secretary

1730
02:19:41,376 --> 02:19:43,467
called the League of Nations a good joke.

1731
02:19:44,333 --> 02:19:49,357
Even though it was the stated policy of the British government to support it.

1732
02:19:49,574 --> 02:19:51,728
To the humiliation of president Wilson,

1733
02:19:51,729 --> 02:19:55,172
the U.S. Congress wouldn't ratify the League either.

1734
02:19:55,173 --> 02:19:58,698
Despite the fact that it had been ratified by many other nations,

1735
02:19:58,699 --> 02:20:02,731
without money flowing from the U.S. treasury, the League died.

1736
02:20:03,213 --> 02:20:06,234
After WWI, the American public had grown tired

1737
02:20:06,855 --> 02:20:10,860
of the internationalist policies of democrat Woodrow Wilson.

1738
02:20:11,638 --> 02:20:13,695
In the presidential election of 1920,

1739
02:20:14,234 --> 02:20:19,266
republican Warren Harding won a landslide victory with over 60% of the votes.

1740
02:20:20,577 --> 02:20:25,603
Harding was an ardent follower of both bolshevism and the League of Nations.

1741
02:20:25,976 --> 02:20:28,457
His election, which opened a 12 year run

1742
02:20:28,458 --> 02:20:30,834
of republican presidents in the White House,

1743
02:20:30,835 --> 02:20:35,850
lead to an unprecedented era of prosperity known as the "roaring twenties".

1744
02:20:37,173 --> 02:20:40,182
Despite the fact that war had brought America a debt

1745
02:20:40,264 --> 02:20:42,759
ten times larger than its civil war debt,

1746
02:20:42,076 --> 02:20:44,110
still the American economy surged.

1747
02:20:45,555 --> 02:20:48,030
Gold had poured into the country during the war

1748
02:20:48,031 --> 02:20:50,512
and it continued to do so afterwards.

1749
02:20:50,513 --> 02:20:53,650
In the early 1920's, the governor of this bank,

1750
02:20:53,651 --> 02:20:55,772
the Federal Reserve Bank of New York,

1751
02:20:55,773 --> 02:20:56,871
a man named Benjamin Strong,

1752
02:20:57,821 --> 02:21:02,943
met frequently with the secretive and eccentric governor of the Bank of England,

1753
02:21:02,944 --> 02:21:03,955
Montague Norman.

1754
02:21:04,636 --> 02:21:06,647
Norman was determined to replace the gold

1755
02:21:06,747 --> 02:21:08,831
England had lost to the U.S. during WWI

1756
02:21:09,863 --> 02:21:15,870
and returne the Bank of England to its former position of dominance in world finance.

1757
02:21:17,128 --> 02:21:19,154
On top of that, rich with gold,

1758
02:21:19,405 --> 02:21:22,448
the American economy might get out of control again,

1759
02:21:22,449 --> 02:21:25,451
just like it had done after the civil war.

1760
02:21:25,622 --> 02:21:30,016
During the next 8 years, under the president seize of Harding and Coolidge,

1761
02:21:30,017 --> 02:21:32,108
the huge federal debt built up during WWI

1762
02:21:33,807 --> 02:21:35,868
was cut by 38%, down to $16 billion.

1763
02:21:38,702 --> 02:21:41,717
The greatest percentage drop in U.S. history.

1764
02:21:42,732 --> 02:21:46,066
During the election of 1920, Warren Harding and Calvin Coolidge

1765
02:21:46,067 --> 02:21:49,076
ran against James Cox, the governor of Ohio,

1766
02:21:49,587 --> 02:21:52,276
and the little known Franklin D. Roosevelt,

1767
02:21:52,277 --> 02:21:54,374
who had previously risen to no higher post

1768
02:21:55,638 --> 02:21:58,724
than president Wilson's assistant secretary of the navy.

1769
02:22:00,131 --> 02:22:05,138
After his inauguration, Harding moved quickly to formally kill the League of Nations.

1770
02:22:05,832 --> 02:22:08,576
Then he quickly moved to reduce domestic taxes

1771
02:22:08,577 --> 02:22:10,652
while raising tariffs to record heights.

1772
02:22:11,909 --> 02:22:15,414
Now, this was a revenue policy of which most of the founding fathers

1773
02:22:15,415 --> 02:22:17,420
would certainly have approved.

1774
02:22:18,101 --> 02:22:21,902
His second year in office, Harding took ill on a train trip in the West

1775
02:22:21,903 --> 02:22:22,931
and suddenly died.

1776
02:22:23,704 --> 02:22:25,749
Although no autopsy was performed

1777
02:22:25,075 --> 02:22:29,077
the cause was said to be either pneumonia or food poisoning.

1778
02:22:30,972 --> 02:22:35,359
When Coolidge took over, he continued Harding's domestic economic policy

1779
02:22:35,036 --> 02:22:38,110
of high tariffs on imports while cutting income taxes.

1780
02:22:39,725 --> 02:22:44,773
As a result, the economy grew at such a rate that net revenue still increased.

1781
02:22:45,839 --> 02:22:47,842
Now, that had to be stopped.

1782
02:22:47,939 --> 02:22:50,702
So, just as they had done so frequently before,

1783
02:22:50,703 --> 02:22:54,782
the Money Changers decided it was time to crash the American economy.

1784
02:22:55,924 --> 02:22:59,031
The Fed began flooding the country with money.

1785
02:22:59,032 --> 02:23:03,035
They increased the money supply by 62% during these years.

1786
02:23:03,356 --> 02:23:04,360
Money was plentiful.

1787
02:23:04,778 --> 02:23:07,839
This is why it was known as the "roaring twenties".

1788
02:23:08,733 --> 02:23:11,831
Before his death in 1919, former president Teddy Roosevelt

1789
02:23:13,353 --> 02:23:16,281
warned the American people what was going on.

1790
02:23:16,282 --> 02:23:21,313
As reported in the March 27th, 1922 edition of the NY Times, Roosevelt said:

1791
02:23:46,342 --> 02:23:50,706
Just one day before, in the NY Times, the major of NY, John Highland

1792
02:23:50,707 --> 02:23:54,798
quoted Roosevelt and blasted those he saw as taking control of America,

1793
02:23:55,784 --> 02:23:57,869
its political machinery and its press:

1794
02:25:23,168 --> 02:25:26,139
Why didn't people listen to such strong warnings and demand

1795
02:25:26,014 --> 02:25:30,081
that Congress reverse its 1913 passage of the Federal Reserve Act?

1796
02:25:31,134 --> 02:25:33,179
Because remember: it was the 1920s:

1797
02:25:33,913 --> 02:25:37,946
a steady increase in bank loans contributed to a rising market.

1798
02:25:37,947 --> 02:25:41,696
In other words, just as it is today, in times of prosperity,

1799
02:25:41,697 --> 02:25:44,706
no one wants to worry about economic issues.

1800
02:25:45,709 --> 02:25:48,653
But there was a dark side to all this prosperity.

1801
02:25:48,654 --> 02:25:51,802
Businesses expanded and became strong out on credit.

1802
02:25:51,803 --> 02:25:54,858
Speculation in the booming stock market became rampant.

1803
02:25:55,354 --> 02:25:59,386
Although everything looked rosy, it was a castle made of sand.

1804
02:25:59,734 --> 02:26:03,742
When all was in readiness, in April of 1929, Paul Warburg,

1805
02:26:04,017 --> 02:26:07,066
the father of the Fed, sent out a secret advisory

1806
02:26:07,921 --> 02:26:12,925
warning his friends that a collapse and nationwide depression was certain.

1807
02:26:13,341 --> 02:26:16,396
In August of 1929, the Fed began to tighten money.

1808
02:26:18,335 --> 02:26:20,404
It is not a coincidence that the biographies

1809
02:26:21,026 --> 02:26:23,627
of all the Wall Street giants of that era,

1810
02:26:23,628 --> 02:26:26,696
John D. Rockefeller, J.P. Morgan, Bernard Beruch etc.

1811
02:26:27,503 --> 02:26:31,670
all marvelled that they got out of the stock market just before the crash

1812
02:26:31,671 --> 02:26:33,767
and put all their assets in cash or gold.

1813
02:26:35,216 --> 02:26:37,307
On October 24th, 1929, the big NY bankers

1814
02:26:39,238 --> 02:26:41,335
called in their 24-hour broker call loans.

1815
02:26:42,728 --> 02:26:44,789
This meant that both stockbrokers and customers

1816
02:26:45,339 --> 02:26:48,410
had to dump their stocks on the market to cover their loans,

1817
02:26:48,411 --> 02:26:51,520
no matter what price they had to sell them for.

1818
02:26:51,521 --> 02:26:56,546
As a result, the market tumbled and that day was known as "black Thursday".

1819
02:26:57,477 --> 02:27:01,924
According to John Kenneth Galbraith, writing in "The great crash 1929",

1820
02:27:01,925 --> 02:27:06,984
at the height of the selling frenzy, Bernard Beruch brought Winston Churchill

1821
02:27:06,985 --> 02:27:10,526
into the visitors gallery of the NY stock exchange here,

1822
02:27:10,527 --> 02:27:13,729
to witness the panic and impress him with his power

1823
02:27:13,073 --> 02:27:15,152
over the wild events down on the floor.

1824
02:27:17,573 --> 02:27:18,650
Congressman Louis McFadden,

1825
02:27:19,344 --> 02:27:24,291
chairman of the House Committee on banking and currency from 1920 to 1931,

1826
02:27:24,292 --> 02:27:25,331
knew whom to blame.

1827
02:27:26,184 --> 02:27:31,205
He accused the Fed and the international bankers of orchestrating the crash.

1828
02:27:48,769 --> 02:27:50,785
But McFadden went even farther:

1829
02:27:51,044 --> 02:27:53,827
he openly accused them of causing the crash

1830
02:27:54,224 --> 02:27:56,262
in order to steal America's gold.

1831
02:27:57,274 --> 02:28:01,357
In February 1931, in the midst of the depression, he put it his way:

1832
02:28:19,811 --> 02:28:22,519
Curtis Dall, a broker for Lehman brothers,

1833
02:28:22,052 --> 02:28:26,459
was on the floor of the NY stock exchange the day of the crash.

1834
02:28:26,928 --> 02:28:29,995
In his 1970 book, "FDR: my exploited father in law",

1835
02:28:31,191 --> 02:28:33,707
he explained that the crash was triggered

1836
02:28:33,708 --> 02:28:37,786
by the planned sudden shortage of call money in the NY money market.

1837
02:28:54,117 --> 02:28:58,172
Within a few weeks, $3 billion of wealth simply seemed to vanish.

1838
02:28:59,288 --> 02:29:01,379
Within a year, $40 billion had been lost.

1839
02:29:04,345 --> 02:29:09,359
But did it really disappear? Or was it simply consolidated in fewer hands?

1840
02:29:10,469 --> 02:29:11,548
And what did the Fed do?

1841
02:29:13,174 --> 02:29:15,817
Instead of moving to help the economy out,

1842
02:29:15,818 --> 02:29:19,819
by quickly lowering interest rates to stimulate the economy,

1843
02:29:19,928 --> 02:29:23,762
the Fed continued to broodily contract the money supply further,

1844
02:29:23,763 --> 02:29:24,770
deepening the depression.

1845
02:29:26,015 --> 02:29:27,072
Between 1929 and 1933,

1846
02:29:29,006 --> 02:29:32,085
the Fed reduced the money supply by an additional 33%.

1847
02:29:35,195 --> 02:29:37,333
Although most Americans have never heard

1848
02:29:37,334 --> 02:29:39,361
that the Fed was the cause of the depression,

1849
02:29:39,605 --> 02:29:41,613
this is well known among top economists.

1850
02:29:42,529 --> 02:29:47,616
Milton Friedman, the Nobel price-winning economist, now at Stanford University,

1851
02:29:47,617 --> 02:29:52,648
said the same thing in a national public radio interview in January of 1996:

1852
02:30:07,809 --> 02:30:11,084
But the money lost by most Americans during the depression,

1853
02:30:11,085 --> 02:30:12,124
didn't just vanish.

1854
02:30:13,231 --> 02:30:16,536
It was just re-distributed into the hands of those

1855
02:30:16,537 --> 02:30:20,611
who had gotten out just before the crash and had purchased gold,

1856
02:30:20,612 --> 02:30:25,619
which is always a safe place to put your money just before a depression.

1857
02:30:26,557 --> 02:30:28,631
But America's money also went overseas.

1858
02:30:29,802 --> 02:30:34,396
Incredibly, as president Hoover was heroically trying to rescue banks

1859
02:30:34,397 --> 02:30:35,460
and prop up businesses,

1860
02:30:36,007 --> 02:30:39,762
with millions of Americans starving as the great depression deepened,

1861
02:30:39,826 --> 02:30:42,912
millions of dollars were being spent re-building Germany

1862
02:30:43,781 --> 02:30:45,809
from damage sustained during WWI.

1863
02:30:48,489 --> 02:30:51,157
Eight years before Hitler would invade Poland,

1864
02:30:51,158 --> 02:30:53,158
representative Louis McFadden,

1865
02:30:53,016 --> 02:30:55,708
chairman of the House Banking and Currency Committee,

1866
02:30:55,853 --> 02:30:59,938
warned Congress that Americans were paying for Hitler's rise to power.

1867
02:32:24,013 --> 02:32:29,070
Franklin D. Roosevelt was swept into office during the 1932 presidential election.

1868
02:32:30,421 --> 02:32:32,557
Once Roosevelt was in office, however,

1869
02:32:32,558 --> 02:32:36,366
sweeping emergency banking measures were immediately announced,

1870
02:32:36,367 --> 02:32:40,451
which did nothing but increase the Fed's power over the money supply.

1871
02:32:41,032 --> 02:32:44,058
Then, and only then, did the Fed finally began

1872
02:32:45,138 --> 02:32:48,356
to loosen the purse strings and feed new money

1873
02:32:48,357 --> 02:32:50,408
out to the starving American people.

1874
02:32:54,653 --> 02:32:57,605
At first, Roosevelt railed against the Money Changers

1875
02:32:57,606 --> 02:32:59,920
as being the cause of the depression.

1876
02:32:59,921 --> 02:33:05,015
Believe it or not, this is what he said on March 4th, 1933 in his inaugural address:

1877
02:33:23,608 --> 02:33:28,610
But two days later, Roosevelt declared a bank holiday and closed all banks.

1878
02:33:28,987 --> 02:33:33,555
Later that year, Roosevelt outlawed private ownership of all gold bullion

1879
02:33:33,556 --> 02:33:36,623
and all gold coins with the exception of rare coins.

1880
02:33:37,646 --> 02:33:40,903
Most of the gold in the hands of the average American

1881
02:33:40,904 --> 02:33:42,906
was in the form of gold coins.

1882
02:33:43,275 --> 02:33:46,296
The new decree was, in effect, a confiscation.

1883
02:33:47,447 --> 02:33:51,483
Those who didn't comply risked as much as ten years in prison

1884
02:33:51,816 --> 02:33:54,911
and a $10,000 fine, the equivalent of a $100,000 today.

1885
02:33:58,269 --> 02:34:02,278
Out in small town America, some people didn't trust Roosevelt's order.

1886
02:34:03,234 --> 02:34:06,297
Many were torn between keeping their hard earned wealth

1887
02:34:06,913 --> 02:34:07,994
or obeying the government.

1888
02:34:09,292 --> 02:34:13,233
Those who did turn in their gold, were paid the official price for it:

1889
02:34:13,234 --> 02:34:14,261
$20.66 per ounce.

1890
02:34:17,244 --> 02:34:19,319
So unpopular was the confiscation order,

1891
02:34:20,475 --> 02:34:24,313
that no one anywhere in government would take credit for authoring it.

1892
02:34:24,314 --> 02:34:26,045
No congressman claimed it.

1893
02:34:26,046 --> 02:34:29,989
At the signing ceremony, president Roosevelt made it clear to all present

1894
02:34:29,099 --> 02:34:32,492
that he was not the author of it and publicly stated

1895
02:34:33,384 --> 02:34:35,359
that he had not ever read it.

1896
02:34:35,036 --> 02:34:38,924
Even a secretary of the Treasury said he had never read it either,

1897
02:34:39,249 --> 02:34:41,257
saying it was "what the experts wanted".

1898
02:34:43,667 --> 02:34:46,898
Roosevelt convinced the public to give up their gold

1899
02:34:46,899 --> 02:34:50,562
by saying that pulling the nation's resources was necessary

1900
02:34:50,563 --> 02:34:52,988
to get America out of the depression.

1901
02:34:52,989 --> 02:34:56,041
With great fanfare, he ordered a new bullion depository,

1902
02:34:56,051 --> 02:34:59,538
built to hold the mountain of gold the U.S. government

1903
02:34:59,998 --> 02:35:01,080
was illegally confiscating.

1904
02:35:02,596 --> 02:35:06,639
By 1936, the U.S. bullion depository of Fort Knox was completed

1905
02:35:07,994 --> 02:35:11,060
and in January 1937 the gold began to flow into it.

1906
02:35:12,997 --> 02:35:16,022
The rip-off of the ages was about to proceed.

1907
02:35:17,407 --> 02:35:20,438
In 1935, once the gold had all been turned in,

1908
02:35:21,237 --> 02:35:25,286
the official price of gold was suddenly raised to $35 per ounce.

1909
02:35:26,643 --> 02:35:31,709
But the catch was, only foreigners could sell their gold at the new higher price.

1910
02:35:33,068 --> 02:35:35,836
The Money Changers, who had headed Warburg's note

1911
02:35:35,837 --> 02:35:38,481
and gotten out of the stock market just before the crash

1912
02:35:38,482 --> 02:35:42,553
and bought gold at $20.66 per ounce and then shipped it to London,

1913
02:35:43,564 --> 02:35:46,586
could now bring it back and sell it back to the government

1914
02:35:46,587 --> 02:35:48,444
nearly doubling their money

1915
02:35:48,445 --> 02:35:50,449
while the average American starved.

1916
02:35:52,417 --> 02:35:54,090
The Fort Knox bullion depository

1917
02:35:54,091 --> 02:35:57,249
sits here in the middle of the Fort Knox military reservation,

1918
02:35:57,025 --> 02:35:59,118
30 miles southwest of Louisville, Kentucky.

1919
02:36:00,377 --> 02:36:03,808
This is as close as we were permitted to get to the depository

1920
02:36:03,809 --> 02:36:08,864
despite years of letters from members of Congress to allow our film crew inside.

1921
02:36:11,154 --> 02:36:14,257
The 4-acre grounds immediately surrounding the building

1922
02:36:14,258 --> 02:36:16,350
are guarded by an electrified steel fence,

1923
02:36:17,383 --> 02:36:22,461
an open moat and four machine gun-armed guard pillboxes at the structure's corners.

1924
02:36:23,067 --> 02:36:26,123
When the gold began arriving, on January 13th 1937,

1925
02:36:27,557 --> 02:36:29,580
there was unprecedented security.

1926
02:36:29,937 --> 02:36:32,603
Thousands of official guests watched the arrival

1927
02:36:32,604 --> 02:36:35,238
of a nine-car train from Philadelphia,

1928
02:36:35,239 --> 02:36:39,262
guarded by armed soldiers, postal inspectors, secret servicemen

1929
02:36:39,049 --> 02:36:41,051
and guards from the U.S. mint.

1930
02:36:42,006 --> 02:36:43,014
It was all great theatre:

1931
02:36:43,905 --> 02:36:47,332
America's gold supply from across the land had been pulled,

1932
02:36:47,333 --> 02:36:49,519
supposedly for the public benefit,

1933
02:36:49,052 --> 02:36:51,120
and then safely tucked into Fort Knox.

1934
02:36:52,936 --> 02:36:57,021
But all that security would soon be breached by the government itself.

1935
02:36:58,092 --> 02:37:01,088
Now the stage was set for a really big war,

1936
02:37:01,089 --> 02:37:04,167
one which would pile up death far beyond that of WWI.

1937
02:37:06,961 --> 02:37:11,986
For example, in 1944 alone, the U.S. national income was only $183 billion,

1938
02:37:13,505 --> 02:37:15,578
yet $103 billion was spent on the war.

1939
02:37:17,128 --> 02:37:20,160
This was 30 times the spending rate during WWI.

1940
02:37:20,974 --> 02:37:26,045
In fact, the American taxpayer picked up 55% of the total allied cost of the war.

1941
02:37:27,735 --> 02:37:31,576
But, equally important, virtually every nation involved in WW-II

1942
02:37:31,577 --> 02:37:33,582
greatly multiplied their debt.

1943
02:37:33,887 --> 02:37:38,495
In the U.S. for example, federal debt went from $43 billion in 1940

1944
02:37:38,496 --> 02:37:41,539
up to $257 billion in 1950, an increase of 598%.

1945
02:37:44,907 --> 02:37:47,958
Between 1940 and 1950, Japanese debt swelled 1348%.

1946
02:37:51,228 --> 02:37:54,296
French debt grew 583% and Canadian debt swelled 417%.

1947
02:37:58,919 --> 02:38:02,974
After the war, the world was now divided into two economic camps.

1948
02:38:03,546 --> 02:38:06,041
Communist-command economies on one hand

1949
02:38:06,042 --> 02:38:08,099
vs monopoly capitalists on the other,

1950
02:38:08,999 --> 02:38:13,008
set to fight it out in one perpetual and highly profitable arms raise.

1951
02:38:14,636 --> 02:38:18,369
It was finally time for the central bankers to embark in earnest

1952
02:38:18,037 --> 02:38:21,736
on their three-step plan to centralize the economic systems

1953
02:38:22,007 --> 02:38:23,046
of the entire world

1954
02:38:23,678 --> 02:38:28,194
and finally bring about their global government or New World Order.

1955
02:38:28,195 --> 02:38:30,204
The phases of this plan were:

1956
02:38:30,918 --> 02:38:34,952
Step 1: central bank domination of national economies worldwide.

1957
02:38:35,936 --> 02:38:39,030
Step 2: centralize regional economies through organizations

1958
02:38:40,296 --> 02:38:45,322
such as the European Monetary Union and regional trade unions such as NAFTA.

1959
02:38:46,454 --> 02:38:50,510
Step 3: centralize the world economy through a World Central Bank,

1960
02:38:51,039 --> 02:38:54,913
a world money and ending national independence through abolition

1961
02:38:54,914 --> 02:38:56,976
of all tariffs by treaties like GATT.

1962
02:38:58,043 --> 02:39:00,058
Step 1 was completed long ago.

1963
02:39:01,088 --> 02:39:04,144
Steps 2 and 3 are far advanced, nearing completion.

1964
02:39:04,879 --> 02:39:05,895
What about gold?

1965
02:39:06,149 --> 02:39:10,677
Amongst central banks, the largest holder of gold is now the IMF.

1966
02:39:10,678 --> 02:39:14,720
It and central banks now control 2/3 of the world gold supply,

1967
02:39:15,201 --> 02:39:18,275
giving them the ability to manipulate the gold market.

1968
02:39:18,983 --> 02:39:21,542
Remember the Money Changers' golden rule:

1969
02:39:21,543 --> 02:39:23,616
"He who has the gold makes the rules".

1970
02:39:25,731 --> 02:39:28,284
But before we get into solutions to our problem,

1971
02:39:28,285 --> 02:39:31,627
let's take a look to what happened to all that gold in Fort Knox.

1972
02:39:31,628 --> 02:39:34,954
Because if we don't understand that the gold has been stolen,

1973
02:39:34,955 --> 02:39:38,697
we will allow ourselves to be stampeded into the wrong solution:

1974
02:39:38,698 --> 02:39:39,761
a gold-backed currency.

1975
02:39:41,065 --> 02:39:45,161
Most Americans still believe that the gold is still here, at Fort Knox.

1976
02:39:46,879 --> 02:39:51,897
At the end of WW-II, Fort Knox contained over 700 million ounces of gold,

1977
02:39:52,607 --> 02:39:55,644
an incredible 70% of all the gold in the world.

1978
02:39:57,275 --> 02:39:59,296
How much remains? No one knows.

1979
02:39:59,906 --> 02:40:02,211
Despite the fact that federal law requires

1980
02:40:02,212 --> 02:40:05,064
an annual physical audit of Fort Knox gold,

1981
02:40:05,065 --> 02:40:08,128
the treasury has consistently refused to conduct one.

1982
02:40:09,345 --> 02:40:13,510
The truth is that a reliable audit of whatever remains here,

1983
02:40:13,511 --> 02:40:17,519
has not been conducted since president Eisenhower ordered one in 1953.

1984
02:40:20,404 --> 02:40:22,500
Where did America's gold in Fort Knox go?

1985
02:40:23,767 --> 02:40:27,775
Over the years, it was sold off to European Money Changers

1986
02:40:28,000 --> 02:40:29,097
at the $35 per ounce price.

1987
02:40:30,966 --> 02:40:34,930
Remember: this was during the time when it was illegal for Americans

1988
02:40:34,931 --> 02:40:37,950
to buy any of their own gold from Fort Knox.

1989
02:40:38,262 --> 02:40:40,341
In fact, there was a very infamous case

1990
02:40:41,358 --> 02:40:44,634
where the Firestone family set up a string of dummy corporations

1991
02:40:44,635 --> 02:40:47,750
to purchase Fort Knox's gold and keep it in Switzerland,

1992
02:40:47,751 --> 02:40:48,837
never hitting U.S. shores.

1993
02:40:49,009 --> 02:40:53,050
They were eventually caught, however, and successfully prosecuted.

1994
02:40:55,062 --> 02:41:00,099
Finally, by 1971, all the pure gold had been secretly removed from Fort Knox,

1995
02:41:01,923 --> 02:41:02,986
drained back to London.

1996
02:41:04,063 --> 02:41:06,608
Once the gold was gone from Fort Knox,

1997
02:41:06,609 --> 02:41:08,672
president Nixon closed the gold window

1998
02:41:09,322 --> 02:41:12,327
by repealing Roosevelt's gold reserve act of 1934,

1999
02:41:13,597 --> 02:41:17,623
finally making it legal once again for Americans to buy gold.

2000
02:41:20,158 --> 02:41:23,192
Naturally, gold prices immediately began to soar:

2001
02:41:23,795 --> 02:41:26,827
nine years later, gold sold for $880 per ounce,

2002
02:41:28,262 --> 02:41:31,316
25 times what the gold in Fort Knox was sold for.

2003
02:41:33,562 --> 02:41:36,340
One would think that eventually, someone in the government

2004
02:41:36,341 --> 02:41:39,755
would get wind of what was happening and blow the whistle.

2005
02:41:39,756 --> 02:41:42,847
The largest fortune in the history of the world, stolen.

2006
02:41:44,005 --> 02:41:47,032
Shades of the old James Bond film "Goldfinger".

2007
02:41:47,609 --> 02:41:52,733
Well, as a matter of fact, Ian Flaming, the author of the James Bond series,

2008
02:41:52,734 --> 02:41:55,826
was head of the British counter-intelligence service MI5.

2009
02:41:57,513 --> 02:41:59,760
Some believed in the intelligence community

2010
02:41:59,761 --> 02:42:04,808
that he wrote much of his fiction as a warning as many authors of fiction do.

2011
02:42:05,445 --> 02:42:08,480
If the removal of all the good delivery gold from Fort Knox

2012
02:42:08,796 --> 02:42:12,380
can be viewed as a deliberate raid on the U.S. treasury,

2013
02:42:12,381 --> 02:42:16,093
then such an operation might well have been years in the making.

2014
02:42:16,094 --> 02:42:17,116
Namely, 40 years.

2015
02:42:18,079 --> 02:42:23,128
Certainly enough time for Fleming to get wind of it and try to prevent it.

2016
02:42:23,129 --> 02:42:27,188
So just how did the story of the Fort Knox gold robbery get out?

2017
02:42:29,675 --> 02:42:33,688
It all started with an article in a NY periodical in 1974.

2018
02:42:35,934 --> 02:42:40,020
The article charts that the Rockefeller family was manipulating the Fed

2019
02:42:41,037 --> 02:42:44,741
to sell off Fort Knox gold at bargain-basement prices

2020
02:42:44,742 --> 02:42:46,771
to anonymous European speculators.

2021
02:42:49,095 --> 02:42:51,977
Three days later, the anonymous source of the story,

2022
02:42:52,833 --> 02:42:55,914
Louise Auchincloss Boyer, mysteriously fell to her death

2023
02:42:57,226 --> 02:43:00,281
from the window of her 10th floor apartment in NY.

2024
02:43:01,027 --> 02:43:02,101
How had Mrs. Boyer known

2025
02:43:02,786 --> 02:43:06,789
of the Rockefeller connection to the Fort Knox gold heist?

2026
02:43:07,356 --> 02:43:10,430
She was the long-time secretary of Nelson Rockefeller.

2027
02:43:14,103 --> 02:43:19,105
For the next 14 years, this man Ed Durell, a wealthy Ohio industrialist,

2028
02:43:20,227 --> 02:43:24,320
devoted himself to a quest for the truth concerning the Fort Knox gold.

2029
02:43:25,158 --> 02:43:29,593
He wrote thousands of letters to over 1000 government and banking officials

2030
02:43:29,594 --> 02:43:32,889
trying to find out how much gold was really left

2031
02:43:32,089 --> 02:43:34,336
and where the rest of it had gone.

2032
02:43:35,138 --> 02:43:38,603
Edith Roosevelt, the granddaughter of president Teddy Roosevelt,

2033
02:43:38,604 --> 02:43:42,648
questioned the actions of the government in a March 1975 edition

2034
02:43:43,152 --> 02:43:45,157
of the New Hampshire's Sunday news:

2035
02:44:08,337 --> 02:44:12,365
Unfortunately, Ed Durell never did accomplish his primary goal:

2036
02:44:12,856 --> 02:44:15,893
a full audit of the gold reserves in Fort Knox…

2037
02:44:16,512 --> 02:44:22,520
It's incredible that the world's greater treasure has had little accounting or auditing.

2038
02:44:23,001 --> 02:44:25,398
This gold belonged to the American people,

2039
02:44:25,408 --> 02:44:28,447
not to the Federal Reserve and their foreign owners.

2040
02:44:29,142 --> 02:44:33,584
One thing is certain: the government could blow all of this speculation away

2041
02:44:33,585 --> 02:44:35,661
in a few days with a well publicized audit

2042
02:44:36,346 --> 02:44:39,263
under the searing lights of media cameras.

2043
02:44:39,264 --> 02:44:41,266
It has chosen not to do so.

2044
02:44:42,084 --> 02:44:45,145
One must conclude that they are afraid of the truth

2045
02:44:45,991 --> 02:44:47,083
such an audit would reveal.

2046
02:44:48,927 --> 02:44:50,983
What is the government so afraid of?

2047
02:44:51,613 --> 02:44:55,686
Here is the answer: when president Ronal Reagan took office in 1981,

2048
02:44:56,386 --> 02:45:00,390
his conservative friends urged him to study the feasibility

2049
02:45:00,552 --> 02:45:02,669
of returning to a gold standard

2050
02:45:02,067 --> 02:45:05,093
as the only way to curb government's spending.

2051
02:45:06,205 --> 02:45:08,676
It sounded like a reasonable alternative,

2052
02:45:08,677 --> 02:45:12,853
so president Reagan appointed a group of men called the "Gold Commission",

2053
02:45:12,854 --> 02:45:15,889
to study the situation and report back to Congress.

2054
02:45:16,205 --> 02:45:20,249
What Reagan's Gold Commission reported back to Congress in 1982,

2055
02:45:20,871 --> 02:45:23,935
was the following shocking revelation concerning gold:

2056
02:45:24,777 --> 02:45:26,861
the U.S. treasury owned no gold at all.

2057
02:45:29,013 --> 02:45:31,195
All the gold that was left in Fort Knox,

2058
02:45:31,196 --> 02:45:33,258
was now owned by the Federal Reserve,

2059
02:45:33,943 --> 02:45:38,579
a group of private bankers, as collateral against the national debt.

2060
02:45:38,058 --> 02:45:40,494
The truth of the matter is that never before

2061
02:45:41,017 --> 02:45:45,098
had so much money been stolen from the hands of the general public

2062
02:45:45,099 --> 02:45:49,371
and put into the hands of a small group of private investors:

2063
02:45:49,372 --> 02:45:50,406
the Money Changers.

2064
02:45:55,691 --> 02:45:59,953
I'm standing in front of the headquarters of the International Monetary Fund,

2065
02:45:59,954 --> 02:46:01,040
located in Washington D.C.

2066
02:46:02,629 --> 02:46:07,114
Across the street, right over there, is the headquarters of the World Bank.

2067
02:46:07,115 --> 02:46:10,143
What are these organizations? Who controls them?

2068
02:46:11,106 --> 02:46:14,133
And, most importantly, are they about to create

2069
02:46:14,444 --> 02:46:15,537
a huge worldwide depression?

2070
02:46:18,055 --> 02:46:22,507
Let us step back in time for a moment to the aftermath of WWI.

2071
02:46:23,003 --> 02:46:24,572
People were tired of war.

2072
02:46:24,573 --> 02:46:26,612
So, under the guys of peacemaking,

2073
02:46:27,108 --> 02:46:29,859
the international banker devised the plan

2074
02:46:29,086 --> 02:46:31,120
to consolidate power even further.

2075
02:46:33,298 --> 02:46:38,051
Claiming only an international government would stand the tide of world wars,

2076
02:46:38,052 --> 02:46:41,816
the Money Changers pushed forward a proposal for world government,

2077
02:46:41,817 --> 02:46:42,903
which stood on three legs:

2078
02:46:44,254 --> 02:46:48,102
a world central bank, to be called the Bank of International Settlements,

2079
02:46:48,103 --> 02:46:53,132
a world judiciary, to be called the world court located in The Hagues in the Netherlands

2080
02:46:53,133 --> 02:46:58,141
and a world executive and legislator, to be called the League of Nations.

2081
02:46:59,262 --> 02:47:03,475
As president Clinton's mentor, Georgetown historian Carrol Quigley,

2082
02:47:03,476 --> 02:47:05,573
wrote in his 1966 book "Tragedy and Hope":

2083
02:48:15,364 --> 02:48:19,013
Despite intense pressure from the international banker and the press,

2084
02:48:19,014 --> 02:48:23,057
a handful of U.S. senators, lead by senator Henri Cabbot Lodge,

2085
02:48:23,593 --> 02:48:25,648
kept the U.S. out of these schemes.

2086
02:48:26,545 --> 02:48:29,590
Without U.S. participation, the League was doomed.

2087
02:48:30,585 --> 02:48:35,587
Incredibly, event though the U.S. rejected the World Central Bank, the BIS,

2088
02:48:36,035 --> 02:48:39,056
the NY Federal Reserve ignored its government

2089
02:48:39,314 --> 02:48:42,238
and arrogantly sent representatives to Switzerland

2090
02:48:42,239 --> 02:48:45,311
to participate in the central bankers' meeting

2091
02:48:45,312 --> 02:48:46,357
right up until 1994,

2092
02:48:47,557 --> 02:48:50,630
when the U.S. was finally officially dragged into it.

2093
02:48:52,106 --> 02:48:54,693
Their World Government's schemes thwarted,

2094
02:48:54,694 --> 02:48:56,702
the bankers resorted to the old formula:

2095
02:48:57,533 --> 02:49:01,196
another war to wear down the resistance to world government

2096
02:49:01,197 --> 02:49:03,208
while reaping handsome profits.

2097
02:49:03,773 --> 02:49:07,027
To this end, Wall Street helped resurrect Germany

2098
02:49:07,028 --> 02:49:08,543
through the Thissen Banks,

2099
02:49:08,544 --> 02:49:11,428
which were affiliated with the Herman interests in NY,

2100
02:49:11,429 --> 02:49:14,526
just as the Chase Bank had assisted in the financing

2101
02:49:14,527 --> 02:49:17,566
of the Bolshevik revolution in Russia during WWI.

2102
02:49:18,276 --> 02:49:21,562
Chase Bank was controlled by the Rockefeller family.

2103
02:49:21,563 --> 02:49:25,090
Subsequently, it was merged with Warburg's Manhattan Bank

2104
02:49:25,091 --> 02:49:27,124
to form the Chase-Manhattan Bank.

2105
02:49:30,634 --> 02:49:33,786
Now, this has merged with Chemical Bank of NY

2106
02:49:33,787 --> 02:49:35,861
making it the largest Wall Street bank.

2107
02:49:39,014 --> 02:49:42,019
Their strategy worked: even before WW-II was over,

2108
02:49:43,252 --> 02:49:45,297
world government was back on track.

2109
02:49:46,025 --> 02:49:48,671
In 1944 at Bretton Woods, New Hampshire,

2110
02:49:48,897 --> 02:49:52,906
the IMF and the World Bank were approved with full U.S. participation.

2111
02:49:56,264 --> 02:50:00,170
The second League of Nations, renamed the United Nations,

2112
02:50:00,171 --> 02:50:01,222
was approved in 1945.

2113
02:50:02,766 --> 02:50:06,811
Soon a new international courting system was functioning as well.

2114
02:50:07,544 --> 02:50:11,613
All effective opposition to these international bodies before the war

2115
02:50:12,263 --> 02:50:15,324
had evaporated in the heat of war, just as planned.

2116
02:50:18,024 --> 02:50:21,110
These new organizations simply repeated on a world scale

2117
02:50:22,351 --> 02:50:24,413
what the National Banking Act of 1864

2118
02:50:25,221 --> 02:50:27,226
and the Federal Reserve Act of 1913

2119
02:50:27,977 --> 02:50:29,074
had established in the U.S.

2120
02:50:31,002 --> 02:50:35,069
They created a baking cartel composed of the world's central banks,

2121
02:50:35,892 --> 02:50:39,877
which gradually assumed the power to dictate credit policies

2122
02:50:39,878 --> 02:50:41,910
to the banks of all the nations.

2123
02:50:43,998 --> 02:50:47,007
For example, just as the Federal Reserve Act

2124
02:50:47,263 --> 02:50:50,271
authorized the creation of a new national fiat currency

2125
02:50:51,228 --> 02:50:52,327
called Federal Reserve notes,

2126
02:50:53,324 --> 02:50:57,698
the IMF has been given the authority to issue a world fiat money

2127
02:50:57,699 --> 02:50:59,768
called Special Drawing Rights, or SDRs.

2128
02:51:02,373 --> 02:51:06,456
To date, the IMF has created an excess of $30 billion worth of SDRs.

2129
02:51:09,496 --> 02:51:12,634
Member nations have been pressured to make their currencies

2130
02:51:12,635 --> 02:51:13,728
fully exchangeable for SDRs.

2131
02:51:16,038 --> 02:51:18,054
In 1968, Congress approved laws

2132
02:51:18,956 --> 02:51:22,969
authorizing the Fed to accept SDRs as reserves in the U.S.

2133
02:51:25,003 --> 02:51:28,017
and to issue Fed notes in exchange for SDRs.

2134
02:51:30,164 --> 02:51:31,582
What does that mean.

2135
02:51:31,583 --> 02:51:35,677
It means that in the U.S., SDRs are already part of our lawful money.

2136
02:51:37,215 --> 02:51:38,254
And what about gold?

2137
02:51:38,606 --> 02:51:40,698
SDRs are already partially backed by gold,

2138
02:51:42,078 --> 02:51:46,064
and with 2/3 of world's gold now in the hands of Central Banks,

2139
02:51:46,065 --> 02:51:50,714
the Money Changers can go about structuring the world's economic future

2140
02:51:50,715 --> 02:51:52,813
in whichever way they deem most profitable.

2141
02:51:55,259 --> 02:51:59,297
Keep in mind: just as the Fed is controlled by its board of governors,

2142
02:51:59,298 --> 02:52:02,366
the IMF is controlled by its board of governors,

2143
02:52:02,367 --> 02:52:05,120
which are either the heads of the different Central Banks

2144
02:52:05,121 --> 02:52:08,938
or the heads of the various national treasury departments,

2145
02:52:08,939 --> 02:52:10,967
dominated by their Central Banks.

2146
02:52:11,673 --> 02:52:14,755
Voting power in the IMF gives the U.S. and the U.K.,

2147
02:52:15,051 --> 02:52:17,533
that is to say the Fed and the Bank of England,

2148
02:52:17,993 --> 02:52:19,016
effective control.

2149
02:52:20,701 --> 02:52:24,714
Just as the Fed controls the amount of money in the U.S.,

2150
02:52:24,715 --> 02:52:28,787
the BIS, IMF and World Bank control the money supply for the world.

2151
02:52:32,073 --> 02:52:35,152
So we see the repetition of the old goldsmiths' fraud,

2152
02:52:36,621 --> 02:52:40,980
replicated on the national scale, with Central Banks like the Fed,

2153
02:52:40,981 --> 02:52:46,006
and on the international scale by the three arms of the World Central Bank.

2154
02:52:46,544 --> 02:52:50,365
Is this organization of the BIS, the IMF and the World Bank,

2155
02:52:50,366 --> 02:52:53,907
which we refer to collectively as the "World Central Bank",

2156
02:52:53,908 --> 02:52:57,053
presently expanding and contracting world credit?

2157
02:52:57,054 --> 02:52:57,088
Yes.

2158
02:52:58,016 --> 02:53:01,042
Regulations put into effect in 1988 by the BIS

2159
02:53:02,126 --> 02:53:06,067
required the world's bankers to raise their capital and reserves

2160
02:53:06,068 --> 02:53:08,077
to 8% of liabilities by 1992.

2161
02:53:10,713 --> 02:53:13,747
Increased capital requirements put an upper limit

2162
02:53:14,419 --> 02:53:16,447
to the fractional reserve lending

2163
02:53:17,222 --> 02:53:20,255
similar to the way cash reserve requirements do.

2164
02:53:21,053 --> 02:53:24,118
What is this seemingly insignificant regulation

2165
02:53:24,119 --> 02:53:27,196
made in a Swiss city 8 years ago meant to the world?

2166
02:53:29,243 --> 02:53:32,494
It means our banks cannot loan more and more money

2167
02:53:32,495 --> 02:53:35,954
to buy more and more time before the next depression

2168
02:53:35,955 --> 02:53:38,010
as a maximum loan ratio is now set.

2169
02:53:39,535 --> 02:53:44,158
It means those nations with the lowest bank reserves in their systems

2170
02:53:44,159 --> 02:53:48,402
have already felt the terrible effects of this credit contraction

2171
02:53:48,403 --> 02:53:53,405
as their banks scramble to raise money to increase their reserves to 8%.

2172
02:53:54,297 --> 02:53:56,542
To raise the money, they had to sell stocks,

2173
02:53:56,543 --> 02:53:58,756
which depressed their stock markets

2174
02:53:58,757 --> 02:54:01,802
and began the depression first in their countries.

2175
02:54:02,664 --> 02:54:07,809
Japan, which in 1988 had among the lowest capital and reserve requirements,

2176
02:54:07,081 --> 02:54:10,049
and thus was the most affected by the regulation,

2177
02:54:10,779 --> 02:54:15,795
has experienced the financial crash, which began almost immediately in 1989,

2178
02:54:16,054 --> 02:54:21,119
which has wiped out a staggering 50% of the value of its stock market since 1990

2179
02:54:23,171 --> 02:54:26,232
and 60% of the value of its commercial real estate.

2180
02:54:28,336 --> 02:54:32,343
The Bank of Japan has lowered its interest rates to 0.5%,

2181
02:54:33,031 --> 02:54:36,594
practically giving away money to resurrect the economy,

2182
02:54:36,874 --> 02:54:38,902
but still the depression worsens.

2183
02:54:40,099 --> 02:54:43,130
Due to the $20 billion U.S. bailout of Mexico,

2184
02:54:45,014 --> 02:54:49,029
the financial collapse in that nation is already known here.

2185
02:54:49,348 --> 02:54:53,353
Yet, despite the bailout, the economy continues to be a disaster.

2186
02:54:53,924 --> 02:54:56,927
One huge debt after another is rolled over,

2187
02:54:57,043 --> 02:55:00,379
as new loans have been made simply to enable Mexico

2188
02:55:00,038 --> 02:55:02,111
to pay the interests on the old loans.

2189
02:55:03,454 --> 02:55:07,252
In the south of Mexico, the poor have been in open revolt,

2190
02:55:07,253 --> 02:55:10,422
as every spare peso has been siphoned out of the country

2191
02:55:10,423 --> 02:55:11,504
to make interest payments.

2192
02:55:12,767 --> 02:55:13,800
It is important to note

2193
02:55:14,098 --> 02:55:17,444
that a radical transfer of power is taking place

2194
02:55:17,445 --> 02:55:20,519
as nations become subservient to a supra-national WCB,

2195
02:55:23,091 --> 02:55:26,176
controlled by a handful of the world's richest bankers.

2196
02:55:28,989 --> 02:55:33,085
As the IMF creates more and more SDRs by the stroke of a pen on IMF ledgers,

2197
02:55:33,095 --> 02:55:36,636
more and more nations borrow them to pay interests on their mounting debts

2198
02:55:37,492 --> 02:55:39,543
and gradually fall under the control

2199
02:55:40,016 --> 02:55:42,090
of the faceless bureaucrats of the WCB.

2200
02:55:44,037 --> 02:55:46,833
As the worldwide depression worsens and spreads,

2201
02:55:46,834 --> 02:55:51,888
this will give the WCB the power of economic life and death over these nations.

2202
02:55:52,629 --> 02:55:56,702
It will decide which nations will be permitted to receive further loans

2203
02:55:56,703 --> 02:55:58,704
and which nations will starve.

2204
02:55:59,307 --> 02:56:03,336
Despite all the rhetoric about development and the alleviation of poverty,

2205
02:56:03,337 --> 02:56:07,373
the result is a steady transfer of wealth from the deader nations

2206
02:56:07,374 --> 02:56:09,381
to the Money Changers' Central Banks,

2207
02:56:09,445 --> 02:56:12,176
which control the IMF and the World Bank.

2208
02:56:12,177 --> 02:56:15,245
For example, in 1992, the third world deader nations,

2209
02:56:15,988 --> 02:56:17,932
which borrowed from the World Bank,

2210
02:56:17,933 --> 02:56:22,006
paid $198 million more to the central banks of the developed nations

2211
02:56:23,719 --> 02:56:25,824
for World Bank funded purposes,

2212
02:56:25,825 --> 02:56:27,899
then they received from the World Bank.

2213
02:56:28,634 --> 02:56:30,699
All this increases their permanent debt

2214
02:56:31,285 --> 02:56:35,371
in exchange for temporary relief of poverty caused by prior borrowings.

2215
02:56:37,333 --> 02:56:41,354
Already, these repayments exceed the amount of the new loans.

2216
02:56:41,608 --> 02:56:44,699
By 1992 Africa's external debt had reached $290 billion,

2217
02:56:47,273 --> 02:56:49,275
2.5 times greater then in 1980,

2218
02:56:50,264 --> 02:56:53,432
resulting in skyrocketing infant mortality rates

2219
02:56:53,433 --> 02:56:56,468
and unemployment, deterioration of school, housing

2220
02:56:57,093 --> 02:56:59,155
and the general health of the people.

2221
02:57:00,022 --> 02:57:03,171
The entire world faces the immeasurable suffering

2222
02:57:03,172 --> 02:57:06,209
already destroying the third world and now Japan,

2223
02:57:06,021 --> 02:57:08,118
all for the benefit of the Money Changers.

2224
02:57:09,379 --> 02:57:12,635
As one prominent Brazilian politician put it:

2225
02:57:48,082 --> 02:57:51,698
Although it would be absurd to ignore the pivotal role

2226
02:57:52,437 --> 02:57:55,062
played by influential families such as

2227
02:57:55,063 --> 02:57:59,399
the Rothschilds, the Warburgs, the Shiffs, the Morgans and the Rockefellers,

2228
02:57:59,004 --> 02:58:03,050
in any review of the history of central banking and fractional banking,

2229
02:58:03,447 --> 02:58:07,508
keep in mind: by now, central banks and the large commercial banks

2230
02:58:08,255 --> 02:58:11,311
are up to three centuries old and deeply entrenched

2231
02:58:12,334 --> 02:58:14,396
in the economic life of many nations.

2232
02:58:15,956 --> 02:58:19,017
These banks are no longer dependent on clever individuals

2233
02:58:19,567 --> 02:58:20,665
such as a Nathan Rothschild.

2234
02:58:22,058 --> 02:58:26,114
Years ago, the question of ownership was important, but no longer.

2235
02:58:27,135 --> 02:58:31,004
For example, both the Bank of England and the Bank of France

2236
02:58:31,005 --> 02:58:34,050
were nationalized after WW-II and nothing changed,

2237
02:58:34,085 --> 02:58:35,086
nothing at all.

2238
02:58:37,158 --> 02:58:41,202
They endure and continue to grow now protected by numerous laws,

2239
02:58:42,472 --> 02:58:44,518
paid politicians and mortgage media,

2240
02:58:45,705 --> 02:58:47,786
untouched by the changing of generations.

2241
02:58:49,098 --> 02:58:52,196
Three centuries have given them an aura of respectability;

2242
02:58:54,589 --> 02:58:58,608
the old-school tie is now worn by the sixth generation son,

2243
02:58:59,812 --> 02:59:03,584
who has been raised in a system that he may never question

2244
02:59:03,585 --> 02:59:06,766
as he is named to serve on the governing boards

2245
02:59:06,767 --> 02:59:08,838
of countless philanthropic organizations.

2246
02:59:11,427 --> 02:59:14,478
To focus attention today on individuals or families

2247
02:59:15,537 --> 02:59:19,270
or to attempt to sort out the current holders of power,

2248
02:59:19,271 --> 02:59:23,356
serves little useful purpose and would be a distraction from the cure.

2249
02:59:24,253 --> 02:59:26,309
The problem is far bigger than that.

2250
02:59:27,337 --> 02:59:30,380
It is the corrupt banking system that was and is

2251
02:59:31,764 --> 02:59:35,769
being used to consolidate vast wealth into fewer and fewer hands,

2252
02:59:36,488 --> 02:59:38,545
that is our current economic problem.

2253
02:59:39,616 --> 02:59:42,164
Change the names of the main player now,

2254
02:59:42,165 --> 02:59:46,190
and the problem would neither go away, nor even miss a beat.

2255
02:59:46,902 --> 02:59:51,146
Likewise, among the hordes of bureaucrats working in the World Bank,

2256
02:59:51,147 --> 02:59:53,205
central banks and international banks,

2257
02:59:53,918 --> 02:59:57,954
only a tiny fraction have any idea of what's really going on.

2258
02:59:58,652 --> 03:00:01,118
No doubt they'd be horrified to learn

2259
03:00:01,119 --> 03:00:05,083
that their work is contributing to the terrible impoverishment

2260
03:00:05,084 --> 03:00:09,176
and gradual enslavement of mankind to a few, incredibly rich plutocrats.

2261
03:00:12,831 --> 03:00:17,845
So really, there is no use in emphasizing the role of individuals anymore.

2262
03:00:18,032 --> 03:00:23,530
And the problem even transcends the normal spectrum of political right and left.

2263
03:00:23,819 --> 03:00:27,835
Both, communism and socialism, as well as monopoly capitalism

2264
03:00:29,662 --> 03:00:31,724
have been used by the Money Changers.

2265
03:00:32,934 --> 03:00:36,939
Today they profit from either side of the new political spectrum:

2266
03:00:38,653 --> 03:00:42,655
the big government welfare state on the so-called left wing,

2267
03:00:43,023 --> 03:00:46,027
vs. the neo-conservative laissez-faire capitalists

2268
03:00:47,463 --> 03:00:51,472
who want big government totally out of their lives, on the right wing.

2269
03:00:52,638 --> 03:00:53,730
Either way the bankers win.

2270
03:00:55,727 --> 03:00:59,825
Monetary reform is the most important political issue facing this nation.

2271
03:01:03,496 --> 03:01:08,501
That clarified, let's proceed to the conclusions in the spirit Lincoln declared:

2272
03:01:10,759 --> 03:01:13,822
"with malice towards none, with charity towards all".

2273
03:01:18,157 --> 03:01:22,880
At the start of this video, we asked a number of troubling questions.

2274
03:01:22,881 --> 03:01:24,930
Let's be sure we've answered them.

2275
03:01:26,139 --> 03:01:28,177
What's going on in America today?

2276
03:01:28,537 --> 03:01:31,003
Why are we over our heads in debt?

2277
03:01:31,004 --> 03:01:34,471
Why can't the politicians bring debt under control?

2278
03:01:34,472 --> 03:01:36,474
Why are we over our heads in debt?

2279
03:01:36,493 --> 03:01:38,546
Because we're labouring under a debt money system,

2280
03:01:39,024 --> 03:01:42,075
that is designed and controlled by private bankers.

2281
03:01:42,557 --> 03:01:45,700
Some will argue that the Federal Reserve system

2282
03:01:45,701 --> 03:01:47,717
is a quasi-governmental agency.

2283
03:01:48,785 --> 03:01:52,510
But the president appoints only two of the seven members

2284
03:01:52,511 --> 03:01:55,560
of the Fed's board of governors every four years.

2285
03:01:56,071 --> 03:02:00,119
And he appoints them to 14 year terms, far longer than his own.

2286
03:02:01,687 --> 03:02:03,724
The senate does confirm those appointments,

2287
03:02:04,058 --> 03:02:07,259
but the whole truth is that the president wouldn't dare

2288
03:02:07,026 --> 03:02:11,087
appoint anyone to that board of whom Wall Street does not approve.

2289
03:02:12,081 --> 03:02:14,919
Of course, this does not preclude the possibility

2290
03:02:15,649 --> 03:02:20,218
that some honourable men may be appointed to the board of governors.

2291
03:02:20,219 --> 03:02:23,292
But the fact is that the Fed is specifically designed

2292
03:02:24,316 --> 03:02:26,889
to operate independently of our government

2293
03:02:26,089 --> 03:02:28,157
as are nearly all other central banks.

2294
03:02:31,063 --> 03:02:34,120
Some argue that the Fed promotes monetary stability.

2295
03:02:34,742 --> 03:02:37,739
We saw the current head of the Bank of England, Eddie George,

2296
03:02:37,074 --> 03:02:41,012
claim that this was the most important role of a central bank.

2297
03:02:41,679 --> 03:02:45,204
In fact, the Fed's record of stabilizing the economy,

2298
03:02:45,205 --> 03:02:48,567
shows it to be a miserable failure in this regard.

2299
03:02:48,568 --> 03:02:51,391
Within the first 25 years of its existence,

2300
03:02:51,392 --> 03:02:56,158
the Fed caused three major economic downturns, including the great depression,

2301
03:02:56,159 --> 03:03:00,180
and for the last 30 years has shepherded the American economy

2302
03:03:00,037 --> 03:03:02,118
into a period of unprecedented inflation.

2303
03:03:04,641 --> 03:03:07,668
Again, this is not some wild conspiracy theory;

2304
03:03:08,135 --> 03:03:11,149
it's a well known fact among top economists.

2305
03:03:11,741 --> 03:03:14,827
As Nobel price-winning economist Milton Friedman put it:

2306
03:04:52,745 --> 03:04:56,240
We must learn from our history before it is too late.

2307
03:04:56,241 --> 03:04:58,997
Why can't politicians control the federal debt?

2308
03:04:58,998 --> 03:05:02,000
Because all our money is created out of debt.

2309
03:05:02,601 --> 03:05:04,782
Again, it's a debt-money system.

2310
03:05:04,783 --> 03:05:08,814
Our money is created initially by the purchase of U.S. bonds.

2311
03:05:09,347 --> 03:05:12,072
The public buys bonds, like savings bonds,

2312
03:05:12,073 --> 03:05:14,627
the banks buy bonds, foreigners buy bonds,

2313
03:05:14,628 --> 03:05:17,823
and when the Fed wants to create more money in the system,

2314
03:05:17,824 --> 03:05:21,873
it buys bonds but pays for them with a simple bookkeeping entry,

2315
03:05:22,453 --> 03:05:24,480
which it creates out of nothing.

2316
03:05:24,082 --> 03:05:26,483
Then, this new money created by the Fed

2317
03:05:27,222 --> 03:05:29,315
is multiplied by a factor of ten by the banks,

2318
03:05:30,153 --> 03:05:32,246
thanks to the fractional reserve principle.

2319
03:05:36,773 --> 03:05:39,867
So, although the banks don't create currency,

2320
03:05:39,868 --> 03:05:43,929
they do create check book money, or deposits, by making new loans.

2321
03:05:45,191 --> 03:05:48,095
They even invest some of this created money.

2322
03:05:48,096 --> 03:05:52,377
In fact, over one trillion dollars of this privately-created money

2323
03:05:52,378 --> 03:05:56,182
has been used to purchase U.S. Bonds on the open market,

2324
03:05:56,183 --> 03:06:00,455
which provides the banks with roughly 50 billion dollars in interest,

2325
03:06:00,456 --> 03:06:04,461
risk free, each year, less the interest they pay some depositors.

2326
03:06:05,652 --> 03:06:08,906
In this way, through fractional reserve lending,

2327
03:06:08,907 --> 03:06:10,912
banks create over 90% of the money,

2328
03:06:11,903 --> 03:06:15,954
and therefore cause over 90% of our inflation (approximately 97%).

2329
03:06:16,073 --> 03:06:18,148
What can we do about all this?

2330
03:06:18,806 --> 03:06:22,137
Fortunately, there's a way to fix the problem fairly easily,

2331
03:06:22,138 --> 03:06:25,684
speedily, and without any serious financial problems.

2332
03:06:25,685 --> 03:06:29,685
We can get our country totally out of debt in 1-2 years

2333
03:06:29,977 --> 03:06:33,995
by simply paying off U.S. bonds with debt-free U.S. Notes,

2334
03:06:35,079 --> 03:06:36,154
just like Lincoln issued.

2335
03:06:37,366 --> 03:06:41,378
Of course, that by itself would create tremendous inflation,

2336
03:06:41,379 --> 03:06:44,241
since our currency is presently multiplied

2337
03:06:44,242 --> 03:06:46,323
by the fractional reserve banking system.

2338
03:06:47,083 --> 03:06:51,162
But here's the ingenious solution advanced in part by Milton Friedman

2339
03:06:52,186 --> 03:06:54,207
to keep the money supply stable

2340
03:06:54,523 --> 03:06:58,538
and avoid inflation and deflation while the debt is retired.

2341
03:07:00,187 --> 03:07:04,281
As the Treasury buys up its bonds on the open market with U.S. Notes,

2342
03:07:05,295 --> 03:07:08,409
the reserve requirements of your hometown local bank

2343
03:07:08,041 --> 03:07:09,140
will be proportionally raised

2344
03:07:10,097 --> 03:07:13,125
so the amount of money in circulation remains constant.

2345
03:07:14,251 --> 03:07:17,633
As those holding bonds are paid off in U.S. Notes,

2346
03:07:17,634 --> 03:07:20,679
they will deposit this money, thus making available the currency

2347
03:07:21,085 --> 03:07:24,147
then needed by the banks to increase their reserves.

2348
03:07:25,141 --> 03:07:28,204
Once all the U.S. bonds are replaced with U.S. Notes,

2349
03:07:28,205 --> 03:07:30,273
banks will be at 100% reserve banking,

2350
03:07:31,399 --> 03:07:34,497
instead of the fractional reserve system currently in use.

2351
03:07:35,734 --> 03:07:39,783
From this point on, the former Fed buildings will only be needed

2352
03:07:40,416 --> 03:07:44,511
as a central clearing houses for checks, and as vaults for U.S. Notes.

2353
03:07:45,933 --> 03:07:50,935
The Federal Reserve Act will no longer be necessary, and could be repealed.

2354
03:07:51,621 --> 03:07:55,639
Monetary power could be transferred back to the treasury department.

2355
03:07:55,064 --> 03:07:59,137
There would be no further creation or contraction of money by banks.

2356
03:08:02,573 --> 03:08:08,010
By doing it this way, our national debt can be paid off in a single year or so,

2357
03:08:08,011 --> 03:08:11,068
and the Fed and fractional reserve banking abolished

2358
03:08:11,826 --> 03:08:16,483
without national bankruptcy, financial collapse, inflation or deflation,

2359
03:08:16,484 --> 03:08:21,895
or any significant change in the way the average American goes about his business.

2360
03:08:21,896 --> 03:08:24,919
To the average person, the primary difference would be

2361
03:08:25,127 --> 03:08:29,730
that for the first time since the Federal Reserve Act was passed in 1913,

2362
03:08:29,731 --> 03:08:31,740
taxes would begin to go down.

2363
03:08:33,333 --> 03:08:36,478
Now there's a real national blessing for you,

2364
03:08:36,479 --> 03:08:38,571
rather than for Hamilton's banker friends.

2365
03:08:40,879 --> 03:08:44,630
Now, let's take a look at these proposals in more detail.

2366
03:08:44,631 --> 03:08:48,103
Here are the main provisions of a Money Reform Act,

2367
03:08:48,104 --> 03:08:50,520
which needs to be passed by Congress.

2368
03:08:50,521 --> 03:08:53,509
We've drafted a proposed Monetary Reform Act,

2369
03:08:53,051 --> 03:08:55,124
which follows at the end of this tape.

2370
03:08:56,487 --> 03:09:00,561
Of course, variations with the same results would be equally welcome.

2371
03:09:06,992 --> 03:09:10,755
As Thomas Edison put it, if the U.S. can issue a dollar bond,

2372
03:09:10,756 --> 03:09:11,853
it can issue a dollar bill.

2373
03:09:12,901 --> 03:09:16,990
They both rest purely on the faith and credit of the U.S. government.

2374
03:09:18,912 --> 03:09:24,177
This amounts to a simple substitution of one type of government obligation for another.

2375
03:09:24,178 --> 03:09:26,656
One bears interest, the other doesn't.

2376
03:09:26,657 --> 03:09:29,708
Federal Reserve Notes could be used for this as well,

2377
03:09:29,709 --> 03:09:33,058
but could not be printed after the Fed is abolished, as we propose,

2378
03:09:33,059 --> 03:09:35,138
so we suggest using U.S. Notes instead,

2379
03:09:48,898 --> 03:09:50,912
to absorb the new U.S. Notes,

2380
03:09:51,095 --> 03:09:55,146
which would be deposited and become the banks' increased reserves.

2381
03:09:55,083 --> 03:09:58,205
Towards the end of the first year of the transition period,

2382
03:09:58,953 --> 03:10:01,953
the remaining liabilities of financial institutions

2383
03:10:01,954 --> 03:10:06,990
would be assumed or acquired by the U.S. government in a one-time operation.

2384
03:10:07,347 --> 03:10:12,404
In other words, they too would eventually be paid off with debt-free U.S. Notes,

2385
03:10:12,918 --> 03:10:15,950
in order to keep the total money supply stable.

2386
03:10:16,601 --> 03:10:21,132
At the end of the first year, or so, all of the national debt would be paid,

2387
03:10:21,133 --> 03:10:25,138
and we could start enjoying the benefits of full-reserve banking.

2388
03:10:25,807 --> 03:10:27,899
The Fed would be obsolete, an anachronism.

2389
03:10:30,481 --> 03:10:33,495
3. Repeal of the Federal Reserve Act of 1913

2390
03:10:34,676 --> 03:10:36,738
and the National Banking Act of 1864.

2391
03:10:38,422 --> 03:10:42,478
These acts delegate the money power to a private banking monopoly.

2392
03:10:42,998 --> 03:10:46,237
They must be repealed and the monetary power handed back

2393
03:10:46,238 --> 03:10:47,821
to the Department of the Treasury,

2394
03:10:47,822 --> 03:10:50,921
where they were initially, under President Abraham Lincoln.

2395
03:10:52,014 --> 03:10:56,335
No banker or person in any way affiliated with financial institutions

2396
03:10:56,462 --> 03:10:58,513
should be allow to regulate banking.

2397
03:10:59,241 --> 03:11:00,904
After the first two reforms,

2398
03:11:00,905 --> 03:11:03,953
these Acts would serve no useful purpose anyway,

2399
03:11:03,954 --> 03:11:07,046
since they relate to a fractional reserve banking system.

2400
03:11:15,823 --> 03:11:18,306
These institutions, like the Federal Reserve,

2401
03:11:18,307 --> 03:11:20,370
are designed to further centralize the power

2402
03:11:20,938 --> 03:11:23,557
of the international bankers over the world's economy

2403
03:11:23,558 --> 03:11:26,086
and the U.S. must withdraw from them.

2404
03:11:26,087 --> 03:11:29,114
Their harmless functions such as currency exchange

2405
03:11:29,358 --> 03:11:31,483
can be accomplished either nationally,

2406
03:11:31,484 --> 03:11:34,535
or in new organizations limited to those functions.

2407
03:11:36,421 --> 03:11:38,513
Such a Monetary Reform Act would guarantee

2408
03:11:39,541 --> 03:11:43,579
that the amount of money in circulation would stay very stable,

2409
03:11:44,166 --> 03:11:46,173
causing neither inflation nor deflation.

2410
03:11:47,292 --> 03:11:49,617
Remember: for the last three decades

2411
03:11:49,618 --> 03:11:53,644
the Fed has doubled the American money supply every 10 years.

2412
03:11:54,629 --> 03:11:59,632
That fact and fractional reserve banking are the real causes of inflation

2413
03:11:59,783 --> 03:12:02,850
and the reduction in our buying power, a hidden tax.

2414
03:12:03,644 --> 03:12:05,741
These and other taxes are the real reasons

2415
03:12:06,689 --> 03:12:09,714
both parents now have to work just to get by.

2416
03:12:10,958 --> 03:12:14,859
The money supply should increase slowly to keep prices stable,

2417
03:12:14,086 --> 03:12:18,210
roughly in proportion to population growth, about 3% per year,

2418
03:12:18,985 --> 03:12:22,553
not at the whim of a group of bankers meeting in secret.

2419
03:12:22,554 --> 03:12:27,413
In fact, all future decisions on how much money would be in the American economy

2420
03:12:27,414 --> 03:12:30,482
must be made based on statistics of population growth

2421
03:12:31,459 --> 03:12:32,545
and the price level index.

2422
03:12:34,761 --> 03:12:37,927
The new monetary regulators and the treasury department,

2423
03:12:37,928 --> 03:12:40,167
perhaps called the Monetary Committee,

2424
03:12:40,168 --> 03:12:42,244
would have absolutely no discretion in this matter

2425
03:12:42,929 --> 03:12:44,950
except in time of declared war.

2426
03:12:45,217 --> 03:12:49,313
This would ensure a steady, stable money growth of roughly 3% per year,

2427
03:12:50,054 --> 03:12:54,127
resulting in stable prices and no sharp changes in the money supply.

2428
03:12:56,384 --> 03:13:00,045
To make certain the process is completely open and honest,

2429
03:13:00,046 --> 03:13:03,047
all deliberations would be public, not secret

2430
03:13:03,718 --> 03:13:06,802
as meetings of the Fed's board of governors are today.

2431
03:13:09,714 --> 03:13:11,740
How do we know this would work?

2432
03:13:12,029 --> 03:13:16,100
Because these steps remove the two major causes of economic instability:

2433
03:13:16,074 --> 03:13:18,137
the Fed and fractional reserve banking

2434
03:13:19,482 --> 03:13:23,573
and the newest one as well, the BIS, Bank of International Settlements.

2435
03:13:24,429 --> 03:13:29,456
But, most importantly, the danger of a severe depression would be eliminated.

2436
03:13:30,314 --> 03:13:33,629
Let's listen to Milton Freedman on the single cause

2437
03:13:33,063 --> 03:13:35,074
of severe economic depressions:

2438
03:13:53,006 --> 03:13:56,068
Issuing our own currency, is not a radical solution.

2439
03:13:57,778 --> 03:14:00,504
It's been advocated by Presidents Jefferson,

2440
03:14:00,505 --> 03:14:02,580
Madison, Jackson, Van Buren and Lincoln.

2441
03:14:04,358 --> 03:14:07,367
But has been used at different times in Europe as well.

2442
03:14:08,616 --> 03:14:11,674
Perhaps the best example is one of the small islands

2443
03:14:12,197 --> 03:14:14,882
off the coast of France in the English Channel.

2444
03:14:14,883 --> 03:14:18,482
Called Guernsey, it has been using debt-free money issues

2445
03:14:18,483 --> 03:14:21,574
to pay for large building projects for nearly 200 years.

2446
03:14:23,805 --> 03:14:25,303
Here we are in Guernsey,

2447
03:14:25,304 --> 03:14:28,372
and this is the Guernsey flower and vegetable market.

2448
03:14:29,333 --> 03:14:33,111
Guernsey is one of the most successful examples of just how well

2449
03:14:33,112 --> 03:14:35,156
a debt-free money system can work.

2450
03:14:37,576 --> 03:14:40,615
In 1815, a committee was appointed to investigate

2451
03:14:41,532 --> 03:14:43,588
how best to finance this new market.

2452
03:14:44,803 --> 03:14:47,889
The impoverished island could not afford more new taxes,

2453
03:14:48,799 --> 03:14:52,813
so the State's fathers decided to try a revolutionary idea:

2454
03:14:53,021 --> 03:14:54,119
issue their own paper money.

2455
03:14:56,062 --> 03:14:59,876
They were just colourful paper notes, backed by nothing,

2456
03:14:59,877 --> 03:15:04,919
but the people of this tiny island agreed to accept them and trade with them.

2457
03:15:05,311 --> 03:15:07,387
To be sure they circulated widely,

2458
03:15:07,388 --> 03:15:11,390
they were declared to be "good for the payment of taxes".

2459
03:15:13,602 --> 03:15:16,075
Of course this idea was nothing new.

2460
03:15:16,076 --> 03:15:19,902
It was exactly what America had done before the American Revolution

2461
03:15:19,903 --> 03:15:23,427
and there are many other examples throughout the world.

2462
03:15:23,428 --> 03:15:26,489
But it was new to Guernsey, and it worked miracles.

2463
03:15:28,191 --> 03:15:30,792
This market is still in use, and remember,

2464
03:15:30,793 --> 03:15:34,840
it was built for no debt to the people of this island's state.

2465
03:15:36,847 --> 03:15:39,508
But what if we follow Guernsey's example?

2466
03:15:39,509 --> 03:15:42,638
How would the bankers react to these reforms?

2467
03:15:42,639 --> 03:15:46,604
Certainly the international bankers' cartel will oppose reforms

2468
03:15:46,605 --> 03:15:50,241
that do away with their control of the world's economies,

2469
03:15:50,242 --> 03:15:51,931
as they have in the past.

2470
03:15:51,932 --> 03:15:53,959
But it is equally certain that Congress

2471
03:15:54,203 --> 03:15:57,561
has the Constitutional authority and responsibility

2472
03:15:57,562 --> 03:16:01,564
to authorize the issuance of debt free money, U.S. Notes,

2473
03:16:01,618 --> 03:16:05,644
and to reform the very banking laws it ill-advisedly enacted.

2474
03:16:07,289 --> 03:16:11,323
Undoubtedly, the bankers will claim that issuing debt-free money

2475
03:16:11,324 --> 03:16:14,496
will cause severe inflation or make other dire predictions,

2476
03:16:14,497 --> 03:16:17,340
but remember, it is fractional reserve banking

2477
03:16:17,341 --> 03:16:20,413
which is the real cause of over 90% of all inflation

2478
03:16:21,957 --> 03:16:26,674
not whether debt-free U.S. Notes are used to pay for government deficits.

2479
03:16:26,675 --> 03:16:30,811
In the current system, any spending excesses on the part of Congress,

2480
03:16:30,812 --> 03:16:32,839
are turned into more debt bonds,

2481
03:16:33,348 --> 03:16:35,380
and the 10% purchased by the Fed,

2482
03:16:35,669 --> 03:16:37,763
are then multiplied many times over by the bankers,

2483
03:16:38,061 --> 03:16:40,100
causing over 90% of all inflation.

2484
03:16:43,026 --> 03:16:47,543
Our fractional reserve and debt-based banking system is the problem.

2485
03:16:47,778 --> 03:16:50,823
We must ignore its inevitable resistance to reform

2486
03:16:51,486 --> 03:16:54,489
and remain firm until the cure is complete.

2487
03:16:55,058 --> 03:17:00,472
As the director of the Bank of England in the 1920s, Sir Josiah Stamp put it,

2488
03:17:00,995 --> 03:17:04,094
referring to this modern fractional reserve banking system:

2489
03:17:44,596 --> 03:17:46,665
Americans are slowly figuring this out.

2490
03:17:47,589 --> 03:17:51,803
Today, over 3,200 cities and counties have endorsed the proposal

2491
03:17:51,804 --> 03:17:54,808
of a non-profit organization called "Sovereignty".

2492
03:17:55,878 --> 03:17:58,295
The Sovereignty movement calls for Congress

2493
03:17:58,296 --> 03:18:04,178
to authorize the secretary of the treasury to issue $90 billion per year of U.S. Notes,

2494
03:18:04,179 --> 03:18:06,184
not Fed notes nor debt-based bonds,

2495
03:18:07,025 --> 03:18:11,711
to loan money, interest-free, to cities, counties and school districts

2496
03:18:11,937 --> 03:18:13,954
for needed capital improvements.

2497
03:18:15,692 --> 03:18:20,923
Remarkably, and to their praise, the community bankers association of Illinois,

2498
03:18:20,924 --> 03:18:24,931
representing 515 member banks, has endorsed this Sovereignty proposal,

2499
03:18:26,375 --> 03:18:28,380
a good step in the right direction.

2500
03:18:29,953 --> 03:18:32,030
As Milton Friedman has repeatedly pointed out,

2501
03:18:32,724 --> 03:18:36,798
no severe depression can occur without a severe contraction of money.

2502
03:18:38,309 --> 03:18:42,381
In our system, only the Fed, the BIS, with U.S. bankers cooperation

2503
03:18:44,227 --> 03:18:47,216
or a combination of the largest Wall Street banks

2504
03:18:47,217 --> 03:18:48,292
could cause a depression.

2505
03:18:49,213 --> 03:18:52,756
In other words, our economy is so huge and resilient

2506
03:18:52,757 --> 03:18:55,760
a depression just can't happen by accident.

2507
03:18:56,299 --> 03:19:00,384
Unless we reform our banking system, they will always have that power.

2508
03:19:01,584 --> 03:19:05,597
They can pull the plug on our economy any time they chose.

2509
03:19:05,848 --> 03:19:08,557
The only solution is to abolish the Fed

2510
03:19:08,558 --> 03:19:10,987
and the fractional reserve banking system

2511
03:19:10,988 --> 03:19:12,074
and withdraw from the BIS.

2512
03:19:13,537 --> 03:19:18,575
Only that would brake the power of the international bankers over our economy.

2513
03:19:20,511 --> 03:19:23,513
And keep in mind, a stock market crash itself

2514
03:19:23,835 --> 03:19:25,863
cannot cause a severe depression.

2515
03:19:27,006 --> 03:19:30,033
Only the severe contraction of our money supply

2516
03:19:30,508 --> 03:19:32,509
can cause a severe depression.

2517
03:19:32,742 --> 03:19:36,747
The stock market crash of 1929 only wiped out market speculators,

2518
03:19:37,006 --> 03:19:39,183
mostly the small and the medium ones,

2519
03:19:39,778 --> 03:19:42,817
resulting in $3 billion in wealth changing hands.

2520
03:19:44,294 --> 03:19:47,927
But it served as a smoke screen for a 33% contraction

2521
03:19:47,928 --> 03:19:50,599
in credit by the Fed over the next 4 years,

2522
03:19:50,006 --> 03:19:55,008
which resulted in over $40 billion of wealth from the American middle class

2523
03:19:55,979 --> 03:19:58,024
being transferred to the big banks.

2524
03:19:59,164 --> 03:20:03,203
Then, despite impotent howls of protest from a divided Congress,

2525
03:20:03,884 --> 03:20:07,975
the independent Fed kept the money supply contracted for a full decade.

2526
03:20:09,988 --> 03:20:15,049
Only WW-II ended the terrible suffering the Fed inflicted on the American people.

2527
03:20:17,285 --> 03:20:21,481
In a depression, the remaining wealth of the debt-burned American middle class

2528
03:20:21,482 --> 03:20:26,545
would be wiped out by unemployment, declining wages and the resulting foreclosures.

2529
03:20:27,649 --> 03:20:30,693
If we start to act reforming our monetary system,

2530
03:20:31,034 --> 03:20:35,111
the Money Changers may do what they did in 1929 and then the 1930s:

2531
03:20:36,093 --> 03:20:39,171
crash the stock market and use that as a smoke screen

2532
03:20:40,965 --> 03:20:42,969
while contracting the money supply.

2533
03:20:43,511 --> 03:20:47,767
But if we're determined to fight to regain control over our money,

2534
03:20:47,768 --> 03:20:51,951
we can come out of it fairly quickly, perhaps in only a very few months,

2535
03:20:51,952 --> 03:20:56,958
as U.S. Notes begin to circulate and replace the money withdrawn by the bankers.

2536
03:20:57,061 --> 03:20:59,635
The longer we wait, the greater the danger

2537
03:21:00,185 --> 03:21:03,206
we'll permanently loose control of our Nation.

2538
03:21:05,044 --> 03:21:08,190
But some still wonder why the international bankers

2539
03:21:08,587 --> 03:21:10,620
would want to cause a depression.

2540
03:21:11,316 --> 03:21:14,437
Wouldn't that be killing the goose that is currently

2541
03:21:14,438 --> 03:21:16,446
laying all those gold and interest eggs?

2542
03:21:17,759 --> 03:21:21,791
Remember what Larry Bates said at the first of this videotape:

2543
03:21:22,082 --> 03:21:27,150
"In periods of economic crisis, wealth is not destroyed, it is merely transferred".

2544
03:21:33,051 --> 03:21:37,145
Do we have any hints as to what the Money Changers have in store for us?

2545
03:21:37,146 --> 03:21:41,184
Here is what David Rockefeller, the chairman of Chase-Manhattan Bank,

2546
03:21:41,185 --> 03:21:43,276
the largest Wall Street bank, had to say:

2547
03:21:53,465 --> 03:21:56,521
So, crisis is needed to fulfil their plans quickly.

2548
03:21:57,171 --> 03:22:00,477
The only question is when the crisis will occur.

2549
03:22:00,478 --> 03:22:03,482
Fortunately, we probably have a little time.

2550
03:22:03,054 --> 03:22:07,110
It's unlikely that this crisis will occur before the 1996 elections

2551
03:22:08,433 --> 03:22:10,519
but after that, the danger begins rising.

2552
03:22:13,226 --> 03:22:17,359
But whether or not they decide to cause a crash or depression

2553
03:22:17,036 --> 03:22:19,984
through relentless increases in taxes and the loss

2554
03:22:20,309 --> 03:22:23,824
of hundreds of thousands of jobs being sent overseas,

2555
03:22:23,825 --> 03:22:26,566
thanks to trade agreements such as GATT or NAFTA,

2556
03:22:26,567 --> 03:22:29,618
the American middle class is an endangered species.

2557
03:22:30,956 --> 03:22:34,523
Cheaper labour, including slave labour in red China,

2558
03:22:34,524 --> 03:22:36,605
which Harry Wu has heroically documented,

2559
03:22:37,735 --> 03:22:40,756
is being used to compete with American labour.

2560
03:22:42,112 --> 03:22:46,185
In other words, money is being consolidated in fewer and fewer hands

2561
03:22:47,352 --> 03:22:51,371
as never before in the history of this nation or the world.

2562
03:22:52,091 --> 03:22:56,124
Without reform, the American middle class will soon be extinct,

2563
03:22:56,793 --> 03:22:59,871
leaving only the very rich few and the very many poor

2564
03:23:01,651 --> 03:23:04,653
as has already occurred in most of the world.

2565
03:23:05,561 --> 03:23:08,632
We've been warned of all this by Congressmen, presidents,

2566
03:23:09,272 --> 03:23:12,330
industrialists and economists down through the years.

2567
03:23:13,062 --> 03:23:15,160
Religious leader too, have seen the danger.

2568
03:23:17,007 --> 03:23:22,102
About 1898, during the time of William Jennings Bryan, Pope Leo XIII put it this way:

2569
03:24:16,395 --> 03:24:19,317
More recently, during America's great depression,

2570
03:24:19,318 --> 03:24:21,397
Pope Pius XI spoke of the same problem:

2571
03:25:02,754 --> 03:25:03,800
Educate your friends.

2572
03:25:04,557 --> 03:25:09,698
Our country needs a solid group who really understand how our money is manipulated

2573
03:25:09,699 --> 03:25:13,928
and what the solutions really are, because, if a depression comes,

2574
03:25:13,929 --> 03:25:16,924
there will be those who will call themselves conservatives

2575
03:25:16,925 --> 03:25:21,953
who will come forward advancing solutions framed by the international bankers.

2576
03:25:23,155 --> 03:25:26,322
Beware of calls to return to a gold standard.

2577
03:25:26,323 --> 03:25:26,357
Why?

2578
03:25:27,174 --> 03:25:31,230
Simple: because never before has so much gold been so concentrated

2579
03:25:32,454 --> 03:25:33,535
outside of American hands.

2580
03:25:34,703 --> 03:25:38,080
And never before has so much gold been in the hands

2581
03:25:38,081 --> 03:25:41,879
of international governmental bodies such as the World Bank

2582
03:25:41,088 --> 03:25:43,105
and International Monetary Fund.

2583
03:25:44,057 --> 03:25:47,154
A gold-backed currency usually brings despair to a nation

2584
03:25:48,701 --> 03:25:53,417
and to return to it would certainly be a false solution in our case.

2585
03:25:53,418 --> 03:25:56,450
Remember, we had a gold-backed currency in 1929

2586
03:25:57,032 --> 03:26:00,123
and during the first four years of the great depression.

2587
03:26:01,228 --> 03:26:05,325
Likewise, beware of any plans advanced for a regional or world currency:

2588
03:26:06,766 --> 03:26:09,794
this is the international bankers' Trojan horse.

2589
03:26:15,287 --> 03:26:17,470
Educate your member of Congress.

2590
03:26:17,471 --> 03:26:22,473
It only takes a few persuasive members to make the others pay attention.

2591
03:26:22,092 --> 03:26:25,129
Most Congressmen just don't understand the system.

2592
03:26:26,291 --> 03:26:30,865
Some understand it, but are so influenced by bank PAC contributions

2593
03:26:30,866 --> 03:26:34,910
that they ignore it, not realizing the gravity of their neglect.

2594
03:26:36,523 --> 03:26:39,532
We hope we have made a valuable contribution

2595
03:26:39,009 --> 03:26:41,101
to the national debate on monetary reform.

2596
03:26:43,001 --> 03:26:48,025
It remains for each man to do his duty, consistent with his state in life.

2597
03:26:48,579 --> 03:26:52,651
May God give us the light to help reform our nation, and ourselves.

2598
03:26:55,179 --> 03:26:59,183
We say ourselves, because ultimately vast multitudes of men

2599
03:26:59,519 --> 03:27:02,930
are going to be driven more and more to desperation

2600
03:27:02,931 --> 03:27:07,003
by the accumulation of the world's wealth in fewer and fewer hands.

2601
03:27:07,865 --> 03:27:11,921
Men will tend to become like their oppressors, selfish and greedy.

2602
03:27:13,396 --> 03:27:16,501
Rather, let's keep in mind, during this period of reform,

2603
03:27:16,502 --> 03:27:19,528
a warning not to lose sight of greater things.

2604
03:27:20,219 --> 03:27:21,292
As Pope Pius XI put it:

2605
03:29:35,000 --> 03:29:38,000
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