All language subtitles for The Money Masters part 2 1996.Engilsk

Now it was time for the Money Changers to
get back to the business

of a new, private central bank for America.

During the early 1900s,
men like J.P. Morgan led the charge.

One final panic would be necessary to focus
the nation's attention

on the supposed need for a central bank.

The rationale was that only a central bank
could prevent bank failures.

Morgan was clearly the most
powerful banker in America

and a suspected agent for the Rothschilds.

Morgan had helped finance John D.
Rockefeller standard oil empire

he had also helped finance the monopolies of
Edgar Herman in railroads,

of Andrew Carnegie in steel and of others in
numerous industries.

But, on top of that, J.P. Morgan's father,
Junius Morgan,

had been American financial
agent to the British.

After his father's death, J.P. Morgan
took on a British partner,

Edward Grenfell, a long-time director of the
Bank of England.

In fact, upon Morgan's death,
his estate contained only a few million dollars.

The bulk of the securities most people
thought he owned,

were in fact owned by others.

In 1902, President Theodore Roosevelt
allegedly went after Morgan and his friends

by using the Sherman Anti-Trust Act to try
to break up their industrial monopolies.

Actually, Roosevelt did very little to
interfere in the growing monopolization

of American industry by the bankers and
their surrogates.

For example, Roosevelt supposedly broke up
the Standard Oil monopoly.

But it wasn't really broken at all.

It was merely divided into
seven corporations,

all still controlled by the Rockefellers.

The public was aware of this thanks to
political cartoonists

like Thomas Nast who referred to the bankers
as the "Money Trust."

By 1907, the year after
Teddy Roosevelt's re-election,

Morgan decided it was time to try for a
central bank again.

Using their combined financial muscle,

Morgan and his friends were secretly able to
crash the stock market.

Thousands of small banks were
vastly overextended.

Some had reserves of less
than one percent (1%),

thanks to the fractional reserve principle.

Within days, banks runs were commonplace
across the nation.

Now Morgan stepped into the public arena

and offered to prop up the faltering
American economy

by supporting failing banks with money he
manufactured out of nothing.

It was an outrageous proposal,

far worse than even fractional
reserve banking,

but Congress let him do it.

Morgan manufactured $200 million worth

of this completely reserveless,
private money

and bought things with it,
paid for services with it,

and sent some of it to his branch banks to
lend out at interest.

His plan worked.

Soon, the public regained confidence in
money in general

and quit hoarding their currency.

But as a result, banking power
was further consolidated

into the hands of a few large banks.

By 1908 the panic was over and Morgan was
hailed as a hero

by the president of Princeton University,

a man by the name of Woodrow Wilson:

Economics textbooks would later explain

that the creation of the
Federal Reserve System

was the direct result of the panic of 1907:

"with its alarming epidemic
of bank failures,"

"the country was fed up once and for all"

"with the anarchy of
unstable private banking."

But Minnesota Congressman
Charles A. Lindbergh, Sr.,

the father of the famous aviator,
"Lucky Lindy,"

later explained that the Panic of 1907 was
really just a scam:

So, since the passage of the National
Banking Act of 1863,

the Money Changers had been able to
coordinate a series of booms and busts.

The purpose was not only to fleece the
American public of their property,

but to later to claim that the banking
system was basically so unstable

that it had to be consolidated into a
central bank once again.

After the crash, Teddy Roosevelt, in
response to the Panic of 1907,

signed into law a bill creating
something called

the National Monetary Commission.

The Commission was to
study the banking problem

and make recommendations to Congress.

Of course, the Commission was packed with
Morgan's friends and cronies.

The Chairman was a man named Senator Nelson
Aldrich from Rhode Island.

Aldrich represented the Newport,
Rhode Island homes

of America's richest banking families.

His daughter married John D. Rockefeller Jr.,
and together they had five sons:

John, Nelson (who would become
the Vice-President in 1974),

Laurence, Winthrop, and David

(the head of the Council on Foreign Relations

and former Chairman of Chase Manhattan bank).

As soon as the National Monetary Commission
was set up,

Senator Aldrich immediately embarked on a
two-year tour of Europe,

where he consulted at length with the
private central bankers

in England, France and Germany.

The total cost of his trip alone to the
taxpayers was $300,000

an astronomical sum in those days.

Shortly after his return, on the evening of
November 22, 1910,

some of the wealthiest and most
powerful men in America

boarded Senator Aldrich's private rail car

and in the strictest secrecy
journeyed to this place,

Jekyll Island, off the coast of Georgia.

With the group came Paul Warburg.

Warburg had been given a
$500,000 per year salary

to lobby for the passage of a
privately-owned central bank in America

by the investment firm,
Kuhn, Loeb & Company.

Warburg's partner in this firm
was a man named Jacob Schiff,

the grandson of the man who shared
the Green Shield house

with the Rothschild family in Frankfort.

Schiff, as we'll later find out,
was in the process of spending $20 million

to finance the overthrow
of the Tsar of Russia.

These three European banking families, the
Rothschilds, the Warburgs, and the Schiffs

were interconnected by marriage
down through the years,

just as were their American
banking counterparts,

the Morgans, Rockefellers and Aldrichs.

Secrecy was so tight that all seven primary
participants were cautioned

to use only first names to prevent servants
from learning their identities.

Years later one participant,
Frank Vanderlip,

president of National City Bank of New York

and a representative of the Rockefeller
family, confirmed the Jekyll Island trip

in the February 9, 1935 edition of the
Saturday Evening Post:

The participants came here to figure out how
to solve their major problem

how to bring back a privately-owned
central bank

but there were other problems that needed to
be addressed as well.

First of all, the market share of the big
national banks was shrinking fast.

In the first ten years of the century,

the number of U.S. banks had more than
doubled to over 20,000.

By 1913, only 29% of all banks
were National Banks

and they held only 57% of all deposits.

As Senator Aldrich later admitted in a
magazine article:

Therefore, something had to be done to bring
these new banks under their control.

As John D. Rockefeller
put it: "Competition is a sin"

Secondly, the nation's economy was so strong

that corporations were starting to finance
their expansions out of profits

instead of taking out huge loans
from large banks.

In the first 10 years of the new century,

70% of corporate funding came from profits.

In other words, American industry was
becoming independent of the Money Changers,

and that trend had to be stopped.

All the participants knew

that these problems could be hammered out
into a workable solution,

but perhaps their biggest problem was a
public relations problem,

the name of the new central bank.

That discussion took place right
here in this room,

one of the many conference rooms
in this sprawling hotel

today known as the Jekyll Island Club Hotel.

Aldrich believed that the word "bank" should
not even appear in the name.

Warburg wanted to call the legislation

the National Reserve Bill or
the Federal Reserve Bill.

The idea here was to give the impression
that the purpose of the new central bank

was to stop bank runs, but also to conceal
its monopoly character.

However, it was Aldrich,
the egotistical politician,

who insisted it be called the Aldrich Bill.

After nine days at Jekyll Island,
the group dispersed.

The new central bank would be very similar
to the old Bank of the United States.

It would eventually be given a monopoly
over U.S. currency

and create that money out of nothing.

How does the Fed "create" money out of nothing?

It is a four-step process.
But first a word on bonds.

Bonds are simply promises to pay,
or government IOUs.

People buy bonds to get a
secure rate of interest.

At the end of the term of the bond, the
government repays the bond, plus interest,

and the bond is destroyed.

There are about 3.6 trillion dollars worth
of these bonds at present.

Now here is the Fed moneymaking process:

Step 1. The Fed Open Market Committee approves

the purchase of U.S. Bonds
on the open market.

Step 2. The bonds are purchased
by the Fed Bank

from whoever is offering them for sale on
the open market.

Step 3. The Fed pays for the bonds with
electronic credits to the seller's bank,

which in turn credits
the seller's bank account.

The trick is that these credits are based
on nothing. The Fed just creates them.

Step 4. The banks use these
deposits as reserves.

They can loan out over ten times the amount
of their reserves

to new borrowers, all at interest.

In this way, a Fed purchase of, say a
million dollars worth of bonds,

gets turned into over 10 million dollars in
bank accounts.

The Fed, in effect, creates 10% of this
totally new money

and the banks create the other 90%.

To reduce the amount of money in the economy,
the process is just reversed:

the Fed sells bonds to the public, and money
flows out of the purchaser's local bank.

Loans must be reduced by ten times the
amount of the sale.

So a Fed sale of a million dollars in bonds,

results in 10 million dollars less
money in the economy.

So how does this benefit the bankers whose
representatives huddled at Jekyll Island?

1st - it totally misdirected banking reform
efforts from proper solutions.

2nd - it prevented a proper, debt-free
system of government finance

like Lincoln's Greenbacks - from
making a comeback.

The bond-based system of government finance,

forced on Lincoln after he
created Greenbacks,

was now cast in stone.

3rd - it delegated to the bankers the right
to create 90% of our money supply

based on only fractional reserves

which they could then loan out at interest.

4th - it centralized overall control of our
nation's money supply

in the hands of a few men.

5th - it established a central bank with a
high degree of independence

from effective political control.

Soon after its creation, the Fed's Great
Contraction in the early 1930s

would cause the Great Depression.

This independence has been enhanced
since then, through additional laws.

In order to fool the public into thinking
the government retained control,

the plan called for the Fed to be run by a
Board of Governors

appointed by the President and
approved by the Senate.

But all the bankers had to do was to be sure
that their men

got appointed to the Board of Governors.

That wasn't hard. Bankers have money,
and money buys influence over politicians.

Once the participants left Jekyll Island,
the public relations blitz was on.

The big New York banks put together an
"educational" fund

of five million dollars
to finance professors

at respected universities to
endorse the new bank.

Woodrow Wilson at Princeton was one of the
first to jump on the bandwagon.

But the bankers' subterfuge didn't work.

The Aldrich Bill was quickly identified as
the bankers bill

a bill to benefit only what become known as
the "Money Trust."

As Congressman Lindbergh put it during the
Congressional debate:

Seeing they didn't have the
votes to win in Congress,

the Republican leadership never brought the
Aldrich Bill to a vote.

The bankers quietly decided to move to track
two, the Democratic alternative.

They began financing Woodrow Wilson as the
Democratic nominee.

As respected historian James Perloff put it,

Wall Street financier Bernard Baruch was put
in charge of Wilson's education:

So now, the stage was set. The Money
Changers were poised to install

their privately-owned
central bank once again.

The damage president Andrew Jackson
had done 67 years earlier

had been only partly repaired

with the passage of the national bank act
during the civil war.

Since then, the battle had raged
on across the decades.

The "Jacksonians" became the "Greebackers"

who became the hard-core supporters of
William Jennings Bryan.

With Bryan leading the charge, these
opponents of the Money Changers,

ignorant of Baruch's tutelage,
now threw themselves behind democrat Widrow Wilson.

They and Bryan would soon be betrayed.

During the Presidential campaign,

the Democrats were careful to pretend to
oppose the Aldrich Bill.

As Rep. Louis McFadden, himself a Democrat
as well as chairman

of the House Banking and Currency Committee,
explained it 20 years after the fact:

Once Wilson was elected, Morgan, Warburg,

Baruch and company advanced a "new" plan,

which Warburg named
the Federal Reserve System.

The Democratic leadership hailed the new bill,
called the Glass-Owen Bill,

as something radically different
from the Aldrich Bill.

But in fact, the bill was virtually
identical in every important detail.

In fact, so vehement were the Democratic
denials of similarity

that Paul Warburg,
the father of both bills,

had to step in to reassure his
paid friends in Congress

that the two bills were virtually identical:

But that admission was for private
consumption only.

Publicly, the Money Trust trotted out
Senator Aldrich and Frank Vanderlip,

the president of Rockefeller's
National City Bank of New York

and one of the Jekyll Island seven,

to oppose the new Federal Reserve System.

Years later, however, Vanderlip admitted in
the Saturday Evening Post

that the two measures were
virtually identical:

As Congress neared a vote, they called Ohio
attorney Alfred Crozier to testify.

Crozier noted the similarities between the
Aldrich Bill and the Glass-Owen Bill:

During the debate on the measure,

Senators complained that the big banks were
using their financial muscle

to influence the outcome.

"There are bankers in this country
who are enemies of the public welfare,"

said one Senator.
What an understatement!

Despite the charges of deceit
and corruption,

the bill was finally rammed through the
Senate on December 22, 1913,

after must Senators had left town
for the Holidays,

after having been assured by the leadership
that nothing would be done

until long after the Christmas recess.

On the day the bill was passed,
Congressman Lindbergh

prophetically warned his countrymen that:

On top of all this, only weeks earlier,

Congress had finally passed a bill
legalizing income tax.

Why was the income tax law important?

Because bankers finally had
in place a system

which would run up a virtually unlimited
federal debt.

How would the interest on this debt be
repaid, never mind the principal?

Remember, a privately-owned central bank
creates the principal out of nothing.

The federal government was small then.

Up to then, it had subsisted merely on
tariffs and excise taxes.

Just as with the Bank of England,

the interest payments had to be guaranteed
by direct taxation of the people.

The Money Changers knew that
if they had to rely

on contributions from the states,

eventually the individual state legislatures
would revolt

and either refuse to pay the interest on
their own money,

or at least bring political pressure to bear
to keep the debt small.

It is interesting to note that in 1895
the Supreme Court

had found a similar income tax law
to be unconstitutional.

The Supreme Court even found a corporate
income tax law unconstitutional in 1909.

As a result, Senator Aldrich hustled a bill

for a constitutional amendment allowing
income tax through the Congress.

The proposed 16th
Amendment to the Constitution

was then sent to the state
legislatures for approval,

but some critics claim that the 16th
Amendment was never ratified

by the necessary 3/4s of the states.

In other words, the 16th Amendment
may not be legal.

But the Money Changers were in no mood to
debate the fine points.

By October of 1913, senator Aldrich had
hustled the income tax bill through Congress.

Without the power to tax the people directly
and bypass the states,

the Federal Reserve Bill would be
far less useful to those

who wanted to drive America
deeply into their debt.

A year after the passage of
the Federal Reserve Bill,

Congressman Lindbergh explained
how the Fed created

what we have come
to call the "Business Cycle"

and how they use it to their advantage:

Congressman Lindbergh was
correct on all points.

What he didn't realize
was that most European nations

had already fallen prey to the central
bankers decades or centuries earlier.

But he also mentions the interesting fact
that only one year later,

the Fed had cornered the market in gold;
this is how he put it:

"Already the Federal Reserve banks
have cornered the gold and gold certificates..."

But Congressman Lindbergh was not the only
critic of the Fed.

Congressman Louis McFadden, the Chairman

of the House Banking and Currency committee
from 1920 to 1931

remarked that the Federal Reserve Act
brought about:

Notice how McFadden saw
the international character

of the stockholders of the Federal Reserve.

Another chairman of the House Banking and
Currency Committee in the 1960s,

Wright Patman from Texas, put it this way:

Even the inventor of the electric light,
Thomas Edison,

joined the fray in criticizing the system of
the Federal Reserve:

Three years after the passage of
the Federal Reserve Act,

even President Wilson began
to have second thoughts

about what had been unleashed during his
first term in office.

Before his death in 1924,
President Wilson realized

the full extent of the damage he had
done to America, when he confessed:

"I have unwittingly ruined my government."

So finally, the Money Changers,

those who profit by manipulating the amount
of money in circulation,

had their privately owned central bank
installed again in America.

The major newspapers
(which they also owned)

hailed passage of the Federal Reserve Act
of 1913, telling the public that

"now depressions could be
scientifically prevented."

The fact of the matter was that now
depressions could be scientifically created.

Power was now centralized to
a tremendous extent.

Now it was time for a war - a really big war
- in fact, the first World War.

Of course, to the central banker,

the political issues of war don't matter
nearly as much as the profit potential,

and nothing creates debts like warfare.

England was the best example
up to that time.

During the 119-year period between the
founding of the Bank of England

and Napoleon's defeat at Waterloo,

England had been at war for 56 years.

And much of the remaining time,
she'd been preparing for war.

In World War I, the German Rothschilds
loaned money to the Germans,

the British Rothschilds loaned
money to the British,

and the French Rothschilds loaned
money to the French.

In America, J.P. Morgan was the sales agent
for war materials

to both the British and the French.

In fact, six months into the war, Morgan
became the largest consumer on earth,

spending $10 million a day.

His offices at 23 Wall Street

were mobbed by brokers and salesmen
trying to cut a deal.

In fact, it got so bad that the bank had to
post guards at every door

and at the partners' homes as well.

Many of the New York bankers made out as
well from the war.

President Wilson appointed Bernard Baruch to
head the War Industries Board.

According to historian Jarnes Perloff, both
Baruch and the Rockefellers

profited by some
$200 million during the war.

But profits were not the only motive.
There was also revenge.

The Money Changers never forgave the Tsars

for their support of Lincoln
during the Civil War.

Also, Russia was the last
major European nation

to refuse to give in to the privately owned
central bank scheme.

Three years after World War I broke out,

the Russian Revolution toppled the Tsar and
installed the scourge of communism.

Jacob Schiff of Kuhn, Loeb & Co.
bragged on his deathbed

that he had spent $20 million towards the
defeat of the Tsar.

Money was funnelled from England to support
the revolution as well.

Why would some of the richest men in the
world financially back communism,

the system that was openly vowing to destroy
the so-called capitalism

that made them wealthy?

Researcher Gary Allen explained
it was this way:

As W. Cleon Skousen put it in his 1970 book
"The Naked Capitalist":

But what if these revolutionaries
get out of control

and try to seize power from the super rich?

After all, it was Mao Tse Tung who in 1938
stated his position concerning power:

"Political power grows out
of the barrel of a gun."

The Wall Street/London axis elected
to take the risk.

The master-planners attempted to control
revolutionary communist groups

by feeding them vast quantities of money
when they obeyed,

and contracting their money supply, or even
financing their opposition,

if they got out of control.

Lenin began to understand that

although he was the absolute dictator of the
new Soviet Union,

he was not pulling the financial strings;

someone else was silently in control:

Who was behind it?

Rep. Louis T. McFadden, the Chairman of
the House Banking

and Currency Committee throughout the 1920s

and into the Great Depression years of the
1930s, explained it this way:

In other words, the Fed and
the Bank of England,

at the behest of the international bankers
who controlled them,

were creating a monster, one which would
fuel seven decades

of unprecedented Communist revolution,
warfare, and most importantly - debt.

In case you think there is some chance that
the Money Changers

got communism going and then lost control,

in 1992, The Washington Times reported that
Russian President Boris Jeltsin

was upset that most of the incoming foreign
aid was being siphoned off

"straight back into the coffers
of Western banks in debt service."

No one in his right mind, would claim that a
war as large as World War I

had a single cause. Wars are complex things
with many causative factors.

But on the other hand it would also be
equally foolish

to ignore as a prime cause of WWI those who
would profit the most from the war.

The role of the Money Changers is no wild
conspiracy theory.

They had a motive - a short-range,
self-serving motive

as well as a long-range, political motive of
advancing totalitarian government,

with the Money Changers maintaining the
financial clout

to control whatever politicians might emerge
as the leaders.

Next, we'll see what the Money Changers'
ultimate political goal is for the world.

Shortly after WWI,
the overall political agenda

of the Money Changers began to be clear.

Now that they controlled national
economies individually,

the next step was the ultimate
form of consolidation:

world government.

The new world government proposal
was given top priority

at the Paris peace conference after WWI.

It was called the League of Nations.

But much to the surprise of Paul Warburg and
Bernard Baruch,

who attended the peace conference with
president Wilson,

the world was not yet ready to dissolve
national boundaries.

Nationalism still beats strong in
the human breast.

For example, Lord Curzon, the British
foreign secretary

called the League of Nations a good joke.

Even though it was the stated policy of the
British government to support it.

To the humiliation of president Wilson,

the U.S. Congress wouldn't
ratify the League either.

Despite the fact that it had been ratified
by many other nations,

without money flowing from the U.S.
treasury, the League died.

After WWI, the American public
had grown tired

of the internationalist policies of democrat
Woodrow Wilson.

In the presidential election of 1920,

republican Warren Harding won a landslide
victory with over 60% of the votes.

Harding was an ardent foe of both
bolshevism and the League of Nations.

His election, which opened a 12 year run

of republican presidents in the White House,

lead to an unprecedented era of prosperity
known as the "roaring twenties".

Despite the fact that war had
brought America a debt

ten times larger than its civil war debt,

still the American economy surged.

Gold had poured into the country
during the war

and it continued to do so afterwards.

In the early 1920's,
the governor of this bank,

the Federal Reserve Bank of New York,

a man named Benjamin Strong,

met frequently with the secretive and
eccentric governor of the Bank of England,

Montague Norman.

Norman was determined to replace the gold

England had lost to the U.S. during WWI

and return the Bank of England to its former
position of dominance in world finance.

On top of that, rich with gold,

the American economy might
get out of control again,

just like it had done after the civil war.

During the next 8 years, under the president
seize of Harding and Coolidge,

the huge federal debt built up during WWI

was cut by 38%, down to $16 billion.

The greatest percentage
drop in U.S. history.

During the election of 1920, Warren Harding
and Calvin Coolidge

ran against James Cox, the governor of Ohio,

and the little known Franklin D. Roosevelt,

who had previously risen to no higher post

than president Wilson's
assistant secretary of the navy.

After his inauguration, Harding moved
quickly to formally kill the League of Nations.

Then he quickly moved to
reduce domestic taxes

while raising tariffs to record heights.

Now, this was a revenue policy of which most
of the founding fathers

would certainly have approved.

His second year in office, Harding took ill
on a train trip in the West

and suddenly died.

Although no autopsy was performed

the cause was said to be either pneumonia or
food poisoning.

When Coolidge took over, he continued
Harding's domestic economic policy

of high tariffs on imports while cutting
income taxes.

As a result, the economy grew at such a rate
that net revenue still increased.

Now, that had to be stopped.

So, just as they had done so
frequently before,

the Money Changers decided it was time to
crash the American economy.

The Fed began flooding the
country with money.

They increased the money supply by 62%
during these years.

Money was plentiful.

This is why it was known as the
"roaring twenties".

Before his death in 1919, former president
Teddy Roosevelt

warned the American people
what was going on.

As reported in the March 27th, 1922 edition
of the NY Times, Roosevelt said:

Just one day before, in the NY Times, the
major of NY, John Highland

quoted Roosevelt and blasted those he saw as
taking control of America,

its political machinery and its press:

Why didn't people listen to such
strong warnings and demand

that Congress reverse its 1913 passage of
the Federal Reserve Act?

Because remember: it was the 1920s:

a steady increase in bank loans contributed
to a rising market.

In other words, just as it is today, in
times of prosperity,

no one wants to worry about economic issues.

But there was a dark side to
all this prosperity.

Businesses expanded and became
strong out on credit.

Speculation in the booming stock market
became rampant.

Although everything looked rosy,
it was a castle made of sand.

When all was in readiness,
in April of 1929, Paul Warburg,

the father of the Fed, sent out
a secret advisory

warning his friends that a collapse and
nationwide depression was certain.

In August of 1929,
the Fed began to tighten money.

It is not a coincidence that the biographies

of all the Wall Street giants of that era,

John D. Rockefeller, J.P. Morgan,
Bernard Beruch etc.

all marvelled that they got out of the stock
market just before the crash

and put all their assets in cash or gold.

On October 24th, 1929, the big NY bankers

called in their 24-hour broker call loans.

This meant that both
stockbrokers and customers

had to dump their stocks on the market to
cover their loans,

no matter what price they had
to sell them for.

As a result, the market tumbled and that day
was known as "black Thursday".

According to John Kenneth Galbraith, writing
in "The great crash 1929",

at the height of the selling frenzy, Bernard
Beruch brought Winston Churchill

into the visitors gallery of the NY stock
exchange here,

to witness the panic and impress
him with his power

over the wild events down on the floor.

Congressman Louis McFadden,

chairman of the House Committee on banking
and currency from 1920 to 1931,

knew whom to blame.

He accused the Fed and the international
bankers of orchestrating the crash.

But McFadden went even farther:

he openly accused them of causing the crash

in order to steal America's gold.

In February 1931, in the midst of the
depression, he put it his way:

Curtis Dall, a broker for Lehman brothers,

was on the floor of the NY stock exchange
the day of the crash.

In his 1970 book,
"FDR: my exploited father in law",

he explained that the crash was triggered

by the planned sudden shortage of call money
in the NY money market.

Within a few weeks, $3 billion of wealth
simply seemed to vanish.

Within a year, $40 billion had been lost.

But did it really disappear? Or was it
simply consolidated in fewer hands?

And what did the Fed do?

Instead of moving to help the economy out,

by quickly lowering interest rates to
stimulate the economy,

the Fed continued to broodly contract the
money supply further,

deepening the depression.

Between 1929 and 1933,

the Fed reduced the money supply by an
additional 33%.

Although most Americans have never heard

that the Fed was
the cause of the depression,

this is well known among top economists.

Milton Friedman, the Nobel price-winning
economist, now at Stanford University,

said the same thing in a national public
radio interview in January of 1996:

But the money lost by most Americans
during the depression,

didn't just vanish.

It was just re-distributed into
the hands of those

who had gotten out just before the crash and
had purchased gold,

which is always a safe place to put your
money just before a depression.

But America's money also went overseas.

Incredibly, as president Hoover was
heroically trying to rescue banks

and prop up businesses,

with millions of Americans starving as the
great depression deepened,

millions of dollars were being
spent re-building Germany

from damage sustained during WWI.

Eight years before Hitler
would invade Poland,

representative Louis McFadden,

chairman of the House Banking and
Currency Committee,

warned Congress that Americans were paying
for Hitler's rise to power.

Franklin D. Roosevelt was swept into office
during the 1932 presidential election.

Once Roosevelt was in office, however,

sweeping emergency banking measures were
immediately announced,

which did nothing but increase
the Fed's power over the money supply.

Then, and only then,
did the Fed finally began

to loosen the purse strings
and feed new money

out to the starving American people.

At first, Roosevelt railed against
the Money Changers

as being the cause of the depression.

Believe it or not, this is what he said on
March 4th, 1933 in his inaugural address:

But two days later, Roosevelt declared a
bank holiday and closed all banks.

Later that year, Roosevelt outlawed private
ownership of all gold bullion

and all gold coins with
the exception of rare coins.

Most of the gold in the hands
of the average American

was in the form of gold coins.

The new decree was, in effect,
a confiscation.

Those who didn't comply risked
as much as ten years in prison

and a $10,000 fine, the equivalent of a
$100,000 today.

Out in small town America, some people
didn't trust Roosevelt's order.

Many were torn between keeping their
hard earned wealth

or obeying the government.

Those who did turn in their gold, were paid
the official price for it:

$20.66 per ounce.

So unpopular was the confiscation order,

that no one anywhere in government would
take credit for authoring it.

No congressman claimed it.

At the signing ceremony, president Roosevelt
made it clear to all present

that he was not the author of it and
publicly stated

that he had not ever read it.

Even a secretary of the Treasury said he had
never read it either,

saying it was "what the experts wanted".

Roosevelt convinced the public
to give up their gold

by saying that pulling the nation's
resources was necessary

to get America out of the depression.

With great fanfare, he ordered a new bullion
depository,

built to hold the mountain of
gold the U.S. government

was illegally confiscating.

By 1936, the U.S. bullion depository of Fort
Knox was completed

and in January 1937 the gold
began to flow into it.

The rip-off of the ages
was about to proceed.

In 1935, once the gold had
all been turned in,

the official price of gold was suddenly
raised to $35 per ounce.

But the catch was, only foreigners could
sell their gold at the new higher price.

The Money Changers,
who had headed Warburg's note

and gotten out of the stock market just
before the crash

and bought gold at $20.66 per ounce and then
shipped it to London,

could now bring it back and sell it back to
the government

nearly doubling their money

while the average American starved.

The Fort Knox bullion depository

sits here in the middle of the Fort Knox
military reservation,

30 miles southwest of Louisville, Kentucky.

This is as close as we were permitted to get
to the depository

despite years of letters from members of
Congress to allow our film crew inside.

The 4-acre grounds immediately
surrounding the building

are guarded by an electrified steel fence,

an open moat and four machine gun-armed
guard pillboxes at the structure's corners.

When the gold began arriving,
on January 13th 1937,

there was unprecedented security.

Thousands of official guests
watched the arrival

of a nine-car train from Philadelphia,

guarded by armed soldiers, postal
inspectors, secret servicemen

and guards from the U.S. mint.

It was all great theatre:

America's gold supply from across
the land had been pulled,

supposedly for the public benefit,

and then safely tucked into Fort Knox.

But all that security would soon be breached
by the government itself.

Now the stage was set for a really big war,

one which would pile up death far beyond
that of WWI.

For example, in 1944 alone, the U.S.
national income was only $183 billion,

yet $103 billion was spent on the war.

This was 30 times the spending
rate during WWI.

In fact, the American taxpayer picked up 55%
of the total allied cost of the war.

But, equally important, virtually every
nation involved in WW-II

greatly multiplied their debt.

In the U.S. for example, federal debt went
from $43 billion in 1940

up to $257 billion in 1950,
an increase of 598%.

Between 1940 and 1950,
Japanese debt swelled 1348%.

French debt grew 583% and Canadian debt
swelled 417%.

After the war, the world was now divided
into two economic camps.

Communist-command economies on one hand

vs. monopoly capitalists on the other,

set to fight it out in one perpetual and
highly profitable arms raise.

It was finally time for the central bankers
to embark in earnest

on their three-step plan to centralize the
economic systems

of the entire world

and finally bring about their global
government or New World Order.

The phases of this plan were:

Step 1: central bank domination of national
economies worldwide.

Step 2: centralize regional economies
through organizations

such as the European Monetary Union and
regional trade unions such as NAFTA.

Step 3: centralize the world economy through
a World Central Bank,

a world money and ending national
independence through abolition

of all tariffs by treaties like GATT.

Step 1 was completed long ago.

Steps 2 and 3 are far advanced,
nearing completion.

What about gold?

Amongst central banks, the largest holder of
gold is now the IMF.

It and central banks now control 2/3 of the
world gold supply,

giving them the ability to manipulate
the gold market.

Remember the Money Changers' golden rule:

"He who has the gold makes the rules".

But before we get into solutions
to our problem,

let's take a look to what happened
to all that gold in Fort Knox.

Because if we don't understand
that the gold has been stolen,

we will allow ourselves to be stampeded into
the wrong solution:

a gold-backed currency.

Most Americans still believe that the gold
is still here, at Fort Knox.

At the end of WW-II, Fort Knox contained
over 700 million ounces of gold,

an incredible 70% of all
the gold in the world.

How much remains?
No one knows.

Despite the fact that federal law requires

an annual physical audit of Fort Knox gold,

the treasury has consistently
refused to conduct one.

The truth is that a reliable audit of
whatever remains here,

has not been conducted since president
Eisenhower ordered one in 1953.

Where did America's gold in Fort Knox go?

Over the years, it was sold off to
European Money Changers

at the $35 per ounce price.

Remember: this was during the time when it
was illegal for Americans

to buy any of their own gold from Fort Knox.

In fact, there was a very infamous case

where the Firestone family set up a string
of dummy corporations

to purchase Fort Knox's gold
and keep it in Switzerland,

never hitting U.S. shores.

They were eventually caught, however, and
successfully prosecuted.

Finally, by 1971, all the pure gold had been
secretly removed from Fort Knox,

drained back to London.

Once the gold was gone from Fort Knox,

president Nixon closed the gold window

by repealing Roosevelt's
gold reserve act of 1934,

finally making it legal once again for
Americans to buy gold.

Naturally, gold prices immediately
began to soar:

nine years later,
gold sold for $880 per ounce,

25 times what the gold in
Fort Knox was sold for.

One would think that eventually,
someone in the government

would get wind of what was
happening and blow the whistle.

The largest fortune
in the history of the world, stolen.

Shades of the old James Bond
film "Goldfinger".

Well, as a matter of fact, Ian Flaming, the
author of the James Bond series,

was head of the British counter-intelligence
service MI5.

Some believed in the intelligence community

that he wrote much of his fiction as a
warning as many authors of fiction do.

If the removal of all the good delivery gold
from Fort Knox

can be viewed as a deliberate raid on the
U.S. treasury,

then such an operation might well have been
years in the making.

Namely, 40 years.

Certainly enough time for Fleming to get
wind of it and try to prevent it.

So just how did the story of the Fort Knox
gold robbery get out?

It all started with an article in a NY
periodical in 1974.

The article charts that the Rockefeller
family was manipulating the Fed

to sell off Fort Knox gold at
bargain-basement prices

to anonymous European speculators.

Three days later, the anonymous
source of the story,

Louise Auchincloss Boyer,
mysteriously fell to her death

from the window of her
10th floor apartment in NY.

How had Mrs. Boyer known

of the Rockefeller connection
to the Fort Knox gold heist?

She was the long-time secretary
of Nelson Rockefeller.

For the next 14 years, this man Ed Durell,
a wealthy Ohio industrialist,

devoted himself to a quest for the truth
concerning the Fort Knox gold.

He wrote thousands of letters to over
1000 government and banking officials

trying to find out how much gold
was really left

and where the rest of it had gone.

Edith Roosevelt, the granddaughter of
president Teddy Roosevelt,

questioned the actions of the government in
a March 1975 edition

of the New Hampshire's Sunday news:

Unfortunately, Ed Durell never did
accomplish his primary goal:

a full audit of the gold reserves
in Fort Knox�

It's incredible that the world's greater
treasure has had little accounting or auditing.

This gold belonged to the American people,

not to the Federal Reserve and
their foreign owners.

One thing is certain: the government could
blow all of this speculation away

in a few days with a well publicized audit

under the searing lights of media cameras.

It has chosen not to do so.

One must conclude that they
are afraid of the truth

such an audit would reveal.

What is the government so afraid of?

Here is the answer: when president Ronal
Reagan took office in 1981,

his conservative friends urged him
to study the feasibility

of returning to a gold standard

as the only way to curb
government's spending.

It sounded like a reasonable alternative,

so president Reagan appointed a group of men
called the "Gold Commission",

to study the situation and
report back to Congress.

What Reagan's Gold Commission
reported back to Congress in 1982,

was the following shocking revelation
concerning gold:

the U.S. treasury owned no gold at all.

All the gold that was left in Fort Knox,

was now owned by the Federal Reserve,

a group of private bankers, as collateral
against the national debt.

The truth of the matter is that never before

had so much money been stolen from the hands
of the general public

and put into the hands of a small group of
private investors:

the Money Changers.

I'm standing in front of the headquarters
of the International Monetary Fund,

located in Washington D.C.

Across the street, right over there, is the
headquarters of the World Bank.

What are these organizations?
Who controls them?

And, most importantly,
are they about to create

a huge worldwide depression?

Let us step back in time for a moment to the
aftermath of WWI.

People were tired of war.

So, under the guys of peacemaking,

the international banker devised the plan

to consolidate power even further.

Claiming only an international government
would stand the tide of world wars,

the Money Changers pushed forward a proposal
for world government,

which stood on three legs:

a world central bank, to be called the Bank
of International Settlements,

a world judiciary, to be called the world
court located in The Hagues in the Netherlands

and a world executive and legislator, to be
called the League of Nations.

As president Clinton's mentor,
Georgetown historian Carrol Quigley,

wrote in his 1966 book "Tragedy and Hope":

Despite intense pressure from the
international banker and the press,

a handful of U.S. senators, lead by senator
Henri Cabbot Lodge,

kept the U.S. out of these schemes.

Without U.S. participation,
the League was doomed.

Incredibly, event though the U.S. rejected
the World Central Bank, the BIS,

the NY Federal Reserve
ignored its government

and arrogantly sent
representatives to Switzerland

to participate in
the central bankers' meeting

right up until 1994,

when the U.S. was finally officially
dragged into it.

Their World Government's schemes thwarted,

the bankers resorted to the old formula:

another war to wear down the resistance
to world government

while reaping handsome profits.

To this end, Wall Street helped
resurrect Germany

through the Thissen Banks,

which were affiliated with the Herman
interests in NY,

just as the Chase Bank had assisted
in the financing

of the Bolshevik revolution in
Russia during WWI.

Chase Bank was controlled by
the Rockefeller family.

Subsequently, it was merged with
Warburg's Manhattan Bank

to form the Chase-Manhattan Bank.

Now, this has merged with
Chemical Bank of NY

making it the largest Wall Street bank.

Their strategy worked:
even before WW-II was over,

world government was back on track.

In 1944 at Bretton Woods, New Hampshire,

the IMF and the World Bank were approved
with full U.S. participation.

The second League of Nations,
renamed the United Nations,

was approved in 1945.

Soon a new international courting system was
functioning as well.

All effective opposition to these
international bodies before the war

had evaporated in the heat of war,
just as planned.

These new organizations simply
repeated on a world scale

what the National Banking Act of 1864

and the Federal Reserve Act of 1913

had established in the U.S.

They created a baking cartel composed of the
world's central banks,

which gradually assumed the power
to dictate credit policies

to the banks of all the nations.

For example, just as the Federal Reserve Act

authorized the creation of a new
national fiat currency

called Federal Reserve notes,

the IMF has been given the authority to
issue a world fiat money

called Special Drawing Rights, or SDRs.

To date, the IMF has created an excess of
$30 billion worth of SDRs.

Member nations have been pressured to make
their currencies

fully exchangeable for SDRs.

In 1968, Congress approved laws

authorizing the Fed to accept SDRs as
reserves in the U.S.

and to issue Fed notes in exchange for SDRs.

What does that mean.

It means that in the U.S., SDRs are already
part of our lawful money.

And what about gold?

SDRs are already partially backed by gold,

and with 2/3 of world's gold now
in the hands of Central Banks,

the Money Changers can go about structuring
the world's economic future

in whichever way they deem most profitable.

Keep in mind: just as the Fed is controlled
by its board of governors,

the IMF is controlled by its
board of governors,

which are either the heads of
the different Central Banks

or the heads of the various national
treasury departments,

dominated by their Central Banks.

Voting power in the IMF gives
the U.S. and the U.K.,

that is to say the Fed and
the Bank of England,

effective control.

Just as the Fed controls the
amount of money in the U.S.,

the BIS, IMF and World Bank control the
money supply for the world.

So we see the repetition of the old
goldsmiths' fraud,

replicated on the national scale, with
Central Banks like the Fed,

and on the international scale by the three
arms of the World Central Bank.

Is this organization of the BIS, the IMF and
the World Bank,

which we refer to collectively as the
"World Central Bank",

presently expanding and
contracting world credit?

Yes.

Regulations put into effect
in 1988 by the BIS

required the world's bankers
to raise their capital and reserves

to 8% of liabilities by 1992.

Increased capital requirements
put an upper limit

to the fractional reserve lending

similar to the way cash reserve
requirements do.

What is this seemingly
insignificant regulation

made in a Swiss city 8 years ago
meant to the world?

It means our banks cannot loan more
and more money

to buy more and more time before
the next depression

as a maximum loan ratio is now set.

It means those nations with the lowest bank
reserves in their systems

have already felt the terrible effects of
this credit contraction

as their banks scramble to raise money to
increase their reserves to 8%.

To raise the money, they had to sell stocks,

which depressed their stock markets

and began the depression
first in their countries.

Japan, which in 1988 had among the lowest
capital and reserve requirements,

and thus was the most affected
by the regulation,

has experienced the financial crash,
which began almost immediately in 1989,

which has wiped out a staggering 50% of the
value of its stock market since 1990

and 60% of the value of its
commercial real estate.

The Bank of Japan has lowered
its interest rates to 0.5%,

practically giving away money
to resurrect the economy,

but still the depression worsens.

Due to the $20 billion U.S.
bailout of Mexico,

the financial collapse in that nation is
already known here.

Yet, despite the bailout, the economy
continues to be a disaster.

One huge debt after another is rolled over,

as new loans have been made
simply to enable Mexico

to pay the interests on the old loans.

In the south of Mexico, the poor have been
in open revolt,

as every spare peso has been siphoned
out of the country

to make interest payments.

It is important to note

that a radical transfer of power
is taking place

as nations become subservient to
a supra-national WCB,

controlled by a handful of
the world's richest bankers.

As the IMF creates more and more SDRs by the
stroke of a pen on IMF ledgers,

more and more nations borrow them to pay
interests on their mounting debts

and gradually fall under the control

of the faceless bureaucrats of the WCB.

As the worldwide depression
worsens and spreads,

this will give the WCB the power of economic
life and death over these nations.

It will decide which nations will be
permitted to receive further loans

and which nations will starve.

Despite all the rhetoric about development
and the alleviation of poverty,

the result is a steady transfer of wealth
from the deader nations

to the Money Changers' Central Banks,

which control the IMF and the World Bank.

For example, in 1992,
the third world deader nations,

which borrowed from the World Bank,

paid $198 million more to the central banks
of the developed nations

for World Bank funded purposes,

then they received from the World Bank.

All this increases their permanent debt

in exchange for temporary relief of poverty
caused by prior borrowings.

Already, these repayments exceed the amount
of the new loans.

By 1992 Africa's external debt
had reached $290 billion,

2.5 times greater then in 1980,

resulting in skyrocketing
infant mortality rates

and unemployment,
deterioration of school, housing

and the general health of the people.

The entire world faces
the immeasurable suffering

already destroying the third world
and now Japan,

all for the benefit of the Money Changers.

As one prominent
Brazilian politician put it:

Although it would be absurd to
ignore the pivotal role

played by influential families such as

the Rothschilds, the Warburgs, the Shiffs,
the Morgans and the Rockefellers,

in any review of the history of central
banking and fractional banking,

keep in mind: by now, central banks and the
large commercial banks

are up to three centuries old and
deeply entrenched

in the economic life of many nations.

These banks are no longer dependent
on clever individuals

such as a Nathan Rothschild.

Years ago, the question of ownership
was important, but no longer.

For example, both the Bank of England and
the Bank of France

were nationalized after WW-II
and nothing changed,

nothing at all.

They endure and continue to grow now
protected by numerous laws,

paid politicians and mortgage media,

untouched by the changing of generations.

Three centuries have given them
an aura of respectability;

the old-school tie is now worn by
the sixth generation son,

who has been raised in a system
that he may never question

as he is named to serve on
the governing boards

of countless philanthropic organizations.

To focus attention today on
individuals or families

or to attempt to sort out the current
holders of power,

serves little useful purpose and would be a
distraction from the cure.

The problem is far bigger than that.

It is the corrupt banking system
that was and is

being used to consolidate vast wealth into
fewer and fewer hands,

that is our current economic problem.

Change the names of the main player now,

and the problem would neither go away, nor
even miss a beat.

Likewise, among the hordes of bureaucrats
working in the World Bank,

central banks and international banks,

only a tiny fraction have
any idea of what's really going on.

No doubt they'd be horrified to learn

that their work is contributing to the
terrible impoverishment

and gradual enslavement of mankind to a few,
incredibly rich plutocrats.

So really, there is no use in emphasizing
the role of individuals anymore.

And the problem even transcends the normal
spectrum of political right and left.

Both, communism and socialism, as well as
monopoly capitalism

have been used by the Money Changers.

Today they profit from either side of the
new political spectrum:

the big government welfare state on
the so-called left wing,

vs. the neo-conservative,
laissez-faire capitalists

who want big government totally out
of their lives, on the right wing.

Either way the bankers win.

Monetary reform is the most important
political issue facing this nation.

That clarified, let's proceed to the conclusions
in the spirit Lincoln declared:

"With malice towards none,
with charity towards all".

At the start of this video, we asked a
number of troubling questions.

Let's be sure we've answered them.

What's going on in America today?

Why are we over our heads in debt?

Why can't the politicians bring
debt under control?

Why are we over our heads in debt?

Because we're labouring under
a debt money system,

that is designed and controlled
by private bankers.

Some will argue that
the Federal Reserve system

is a quasi-governmental agency.

But the president appoints only
two of the seven members

of the Fed's board of
governors every four years.

And he appoints them to 14 year terms, far
longer than his own.

The senate does confirm those appointments,

but the whole truth is that
the president wouldn't dare

appoint anyone to that board of whom
Wall Street does not approve.

Of course, this does not
preclude the possibility

that some honourable men may be appointed to
the board of governors.

But the fact is that the Fed is
specifically designed

to operate independently of our government

as are nearly all other central banks.

Some argue that the Fed promotes
monetary stability.

We saw the current head of
the Bank of England, Eddie George,

claim that this was the most important role
of a central bank.

In fact,
the Fed's record of stabilizing the economy,

shows it to be a miserable failure
in this regard.

Within the first 25 years of its existence,

the Fed caused three major economic
downturns, including the great depression,

and for the last 30 years has shepherded the
American economy

into a period of unprecedented inflation.

Again, this is not some wild
conspiracy theory;

it's a well known fact among top economists.

As Nobel price-winning economist
Milton Friedman put it:

We must learn from our history
before it is too late.

Why can't politicians
control the federal debt?

Because all our
money is created out of debt.

Again, it's a debt-money system.

Our money is created initially by the
purchase of U.S. bonds.

The public buys bonds, like savings bonds,

the banks buy bonds, foreigners buy bonds,

and when the Fed wants to create more
money in the system,

it buys bonds but pays for them with a
simple bookkeeping entry,

which it creates out of nothing.

Then, this new money created by the Fed

is multiplied by a factor of ten
by the banks,

thanks to the fractional reserve principle.

So, although the banks don't
create currency,

they do create check book money,
or deposits, by making new loans.

They even invest some of this created money.

In fact, over one trillion dollars of this
privately-created money

has been used to purchase U.S. Bonds on the
open market,

which provides the banks with roughly 50
billion dollars in interest,

risk free, each year, less the interest they
pay some depositors.

In this way,
through fractional reserve lending,

banks create over 90% of the money,

and therefore cause over 90% of our
inflation (approximately 97%).

What can we do about all this?

Fortunately, there's a way to
fix the problem fairly easily,

speedily, and without any serious
financial problems.

We can get our country totally out of debt
in 1-2 years

by simply paying off U.S. bonds with
debt-free U.S. Notes,

just like Lincoln issued.

Of course, that by itself would create
tremendous inflation,

since our currency is presently multiplied

by the fractional reserve banking system.

But here's the ingenious solution
advanced in part by Milton Friedman

to keep the money supply stable

and avoid inflation and deflation while the
debt is retired.

As the Treasury buys up its bonds on the
open market with U.S. Notes,

the reserve requirements of your
hometown local bank

will be proportionally raised

so the amount of money in circulation
remains constant.

As those holding bonds are paid off
in U.S. Notes,

they will deposit this money, thus making
available the currency

then needed by the banks to
increase their reserves.

Once all the U.S. bonds are replaced
with U.S. Notes,

banks will be at 100% reserve banking,

instead of the fractional reserve system
currently in use.

From this point on, the former Fed buildings
will only be needed

as a central clearing houses for checks, and
as vaults for U.S. Notes.

The Federal Reserve Act will no longer be
necessary, and could be repealed.

Monetary power could be transferred back to
the treasury department.

There would be no further creation or
contraction of money by banks.

By doing it this way, our national debt can
be paid off in a single year or so,

and the Fed and fractional reserve
banking abolished

without national bankruptcy,
financial collapse, inflation or deflation,

or any significant change in the way the
average American goes about his business.

To the average person, the primary
difference would be

that for the first time since the Federal
Reserve Act was passed in 1913,

taxes would begin to go down.

Now there's a real national
blessing for you,

rather than for Hamilton's banker friends.

Now, let's take a look at
these proposals in more detail.

Here are the main provisions of
a Money Reform Act,

which needs to be passed by Congress.

We've drafted a proposed
Monetary Reform Act,

which follows at the end of this tape.

Of course, variations with the same results
would be equally welcome.

As Thomas Edison put it, if the U.S. can
issue a dollar bond,

it can issue a dollar bill.

They both rest purely on the faith and
credit of the U.S. government.

This amounts to a simple substitution of one
type of government obligation for another.

One bears interest, the other doesn't.

Federal Reserve Notes could be
used for this as well,

but could not be printed after
the Fed is abolished, as we propose,

so we suggest using U.S. Notes instead,

to absorb the new U.S. Notes,

which would be deposited and become the
banks' increased reserves.

Towards the end of the first year of the
transition period,

the remaining liabilities
of financial institutions

would be assumed or acquired by the U.S.
government in a one-time operation.

In other words, they too would eventually be
paid off with debt-free U.S. Notes,

in order to keep the total
money supply stable.

At the end of the first year, or so,
all of the national debt would be paid,

and we could start enjoying the benefits of
full-reserve banking.

The Fed would be obsolete, an anachronism.

3. Repeal of the Federal Reserve Act of 1913

and the National Banking Act of 1864.

These acts delegate the money power to a
private banking monopoly.

They must be repealed and the
monetary power handed back

to the Department of the Treasury,

where they were initially,
under President Abraham Lincoln.

No banker or person in any way affiliated
with financial institutions

should be allow to regulate banking.

After the first two reforms,

these Acts would serve no
useful purpose anyway,

since they relate to a
fractional reserve banking system.

These institutions,
like the Federal Reserve,

are designed to further centralize the power

of the international bankers over
the world's economy

and the U.S. must withdraw from them.

Their harmless functions such
as currency exchange

can be accomplished either nationally,

or in new organizations limited
to those functions.

Such a Monetary Reform Act would guarantee

that the amount of money in circulation
would stay very stable,

causing neither inflation nor deflation.

Remember: for the last three decades

the Fed has doubled the American money
supply every 10 years.

That fact and fractional reserve banking are
the real causes of inflation

and the reduction in our buying power,
a hidden tax.

These and other taxes are the real reasons

both parents now have
to work just to get by.

The money supply should increase slowly to
keep prices stable,

roughly in proportion to population growth,
about 3% per year,

not at the whim of a group of bankers
meeting in secret.

In fact, all future decisions on how much
money would be in the American economy

must be made based on statistics of
population growth

and the price level index.

The new monetary regulators
and the treasury department,

perhaps called the Monetary Committee,

would have absolutely no discretion
in this matter

except in time of declared war.

This would ensure a steady, stable money
growth of roughly 3% per year,

resulting in stable prices and no sharp
changes in the money supply.

To make certain the process is completely
open and honest,

all deliberations would be public,
not secret

as meetings of the Fed's board
of governors are today.

How do we know this would work?

Because these steps remove the two major
causes of economic instability:

the Fed and fractional reserve banking

and the newest one as well, the BIS,
Bank of International Settlements.

But, most importantly, the danger of a
severe depression would be eliminated.

Let's listen to Milton Freedman
on the single cause

of severe economic depressions:

Issuing our own currency,
is not a radical solution.

It's been advocated by Presidents Jefferson,

Madison, Jackson, Van Buren and Lincoln.

But has been used at different times in
Europe as well.

Perhaps the best example is
one of the small islands

off the coast of France in
the English Channel.

Called Guernsey, it has been using debt-free
money issues

to pay for large building projects for
nearly 200 years.

Here we are in Guernsey,

and this is the Guernsey flower and
vegetable market.

Guernsey is one of the most successful
examples of just how well

a debt-free money system can work.

In 1815, a committee was
appointed to investigate

how best to finance this new market.

The impoverished island could not afford
more new taxes,

so the State's fathers decided
to try a revolutionary idea:

issue their own paper money.

They were just colourful paper notes,
backed by nothing,

but the people of this tiny island agreed to
accept them and trade with them.

To be sure they circulated widely,

they were declared to be
"good for the payment of taxes".

Of course this idea was nothing new.

It was exactly what America had done before
the American Revolution

and there are many other examples
throughout the world.

But it was new to Guernsey,
and it worked miracles.

This market is still in use, and remember,

it was built for no debt to the people of
this island's state.

But what if we follow Guernsey's example?

How would the bankers
react to these reforms?

Certainly the international bankers' cartel
will oppose reforms

that do away with their control of
the world's economies,

as they have in the past.

But it is equally certain that Congress

has the Constitutional authority
and responsibility

to authorize the issuance of
debt free money, U.S. Notes,

and to reform the very banking laws
it ill-advisedly enacted.

Undoubtedly, the bankers will claim that
issuing debt-free money

will cause severe inflation or make other
dire predictions,

but remember,
it is fractional reserve banking

which is the real cause of
over 90% of all inflation

not whether debt-free U.S. Notes are used to
pay for government deficits.

In the current system, any spending excesses
on the part of Congress,

are turned into more debt bonds,

and the 10% purchased by the Fed,

are then multiplied many times
over by the bankers,

causing over 90% of all inflation.

Our fractional reserve and debt-based
banking system is the problem.

We must ignore its inevitable
resistance to reform

and remain firm until the cure is complete.

As the director of the Bank of England in
the 1920s, Sir Josiah Stamp put it,

referring to this modern
fractional reserve banking system:

Americans are slowly figuring this out.

Today, over 3,200 cities and counties have
endorsed the proposal

of a non-profit organization called
"Sovereignty".

The Sovereignty movement calls for Congress

to authorize the secretary of the treasury
to issue $90 billion per year of U.S. Notes,

not Fed notes nor debt-based bonds,

to loan money, interest-free, to cities,
counties and school districts

for needed capital improvements.

Remarkably, and to their praise, the
community bankers association of Illinois,

representing 515 member banks, has endorsed
this Sovereignty proposal,

a good step in the right direction.

As Milton Friedman has
repeatedly pointed out,

no severe depression can occur without a
severe contraction of money.

In our system, only the Fed, the BIS, with
U.S. bankers cooperation

or a combination of the largest
Wall Street banks

could cause a depression.

In other words, our economy is
so huge and resilient

a depression just can't happen by accident.

Unless we reform our banking system,
they will always have that power.

They can pull the plug on our economy
any time they chose.

The only solution is to abolish the Fed

and the fractional reserve banking system

and withdraw from the BIS.

Only that would brake the power of the
international bankers over our economy.

And keep in mind,
a stock market crash itself

cannot cause a severe depression.

Only the severe contraction
of our money supply

can cause a severe depression.

The stock market crash of 1929 only wiped
out market speculators,

mostly the small and the medium ones,

resulting in $3 billion in
wealth changing hands.

But it served as a smoke screen
for a 33% contraction

in credit by the Fed over the next 4 years,

which resulted in over $40 billion of wealth
from the American middle class

being transferred to the big banks.

Then, despite impotent howls of protest from
a divided Congress,

the independent Fed kept the money supply
contracted for a full decade.

Only WW-II ended the terrible suffering the
Fed inflicted on the American people.

In a depression, the remaining wealth of the
debt-burned American middle class

would be wiped out by unemployment,
declining wages and the resulting foreclosures.

If we start to act reforming our
monetary system,

the Money Changers may do what they did in
1929 and then the 1930s:

crash the stock market and use that as a
smoke screen

while contracting the money supply.

But if we're determined to
fight to regain control over our money,

we can come out of it fairly quickly,
perhaps in only a very few months,

as U.S. Notes begin to circulate and replace
the money withdrawn by the bankers.

The longer we wait,
the greater the danger

we'll permanently loose control of our Nation.

But some still wonder why
the international bankers

would want to cause a depression.

Wouldn't that be killing
the goose that is currently

laying all those gold and interest eggs?

Remember what Larry Bates said at the first
of this videotape:

"In periods of economic crisis,
wealth is not destroyed, it is merely transferred".

Do we have any hints as to what the Money
Changers have in store for us?

Here is what David Rockefeller, the chairman
of Chase-Manhattan Bank,

the largest Wall Street bank, had to say:

So, crisis is needed to fulfil
their plans quickly.

The only question is when
the crisis will occur.

Fortunately, we probably have a little time.

It's unlikely that this crisis
will occur before the 1996 elections

but after that, the danger begins rising.

But whether or not they decide to cause a
crash or depression

through relentless increases
in taxes and the loss

of hundreds of thousands of
jobs being sent overseas,

thanks to trade agreements such
as GATT or NAFTA,

the American middle class is
an endangered species.

Cheaper labour,
including slave labour in red China,

which Harry Wu has heroically documented,

is being used to compete
with American labour.

In other words, money is being consolidated
in fewer and fewer hands

as never before in the history of this
nation or the world.

Without reform, the American middle class
will soon be extinct,

leaving only the very rich few
and the very many poor

as has already occurred
in most of the world.

We've been warned of all
this by Congressmen, presidents,

industrialists and economists
down through the years.

Religious leader too, have seen the danger.

About 1898, during the time of William
Jennings Bryan, Pope Leo XIII put it this way:

More recently,
during America's great depression,

Pope Pius XI spoke of the same problem:

Educate your friends.

Our country needs a solid group who really
understand how our money is manipulated

and what the solutions really are, because,
if a depression comes,

there will be those who will call
themselves conservatives

who will come forward advancing solutions
framed by the international bankers.

Beware of calls to return
to a gold standard.

Why?

Simple: because never before has so much
gold been so concentrated

outside of American hands.

And never before has so much
gold been in the hands

of international governmental bodies
such as the World Bank

and International Monetary Fund.

A gold-backed currency usually brings
despair to a nation

and to return to it would certainly be a
false solution in our case.

Remember, we had a gold-backed currency in

and during the first four years of
the great depression.

Likewise, beware of any plans advanced for a
regional or world currency:

this is the international
bankers' Trojan horse.

Educate your member of Congress.

It only takes a few persuasive members to
make the others pay attention.

Most Congressmen just don't
understand the system.

Some understand it, but are so influenced by
bank PAC contributions

that they ignore it, not realizing the
gravity of their neglect.

We hope we have made a valuable contribution

to the national debate on monetary reform.

It remains for each man to do his duty,
consistent with his state in life.

May God give us the light to help reform our
nation, and ourselves.

We say ourselves, because ultimately vast
multitudes of men

are going to be driven more and
more to desperation

by the accumulation of the world's
wealth in fewer and fewer hands.

Men will tend to become like their
oppressors, selfish and greedy.

Rather, let's keep in mind,
during this period of reform,

a warning not to lose sight
of greater things.

As Pope Pius XI put it: