The Creature from Jekyll Island: A Second Look at the Federal Reserve

G. Edward Griffin

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Legislative action pp. 171-176
s rampant inflation and economic chaos. In 1703, South Carolina declared that its money was “a good payment and tender in law” and
Founding or establishment pp. 192-196
actually paid interest to the holders. In 1707, the recently created Bank of England was given the responsibility of managing thi
Legislative action pp. 329-333
ssachusetts 1000%, Rhode Island 2300%.! The situation was so out of hand that, beginning in 1751, the British Parliament stepped i
War or conflict pp. 329-333
d commerce returned to a solid footing. It remained so even during the economic strain of the Seven-Years War (1756-1763) and duri
War or conflict pp. 342-346
was still in progress 1. See Murray N. Rothbard, Conceived in Liberty: The Revolutionary War, 1775-1784 (New Rochelle, New York:
War or conflict pp. 355-359
e, but the wildcatters were everywhere. The War of 1812 was not popular among the American public, and funding would have been imp
Event pp. 355-359
[in specie], that they were insolvent. Rather than allow the banks of the nation to fail, the governments, state and federal, dec
War or conflict pp. 249-254
r for Independence and the War of 1812. In the 126 years between 1689 and 1815, England was at war 63 of them. That is one out of
Assassination of Archduke Franz Ferdinand pp. 249-254
of American taxes to pay off the loans. The origin of World War I usually is attributed to the assassina- tion of Archduke Francis
War or conflict pp. 249-254
ptation of such gigantic flows of cash. Writing in the year 1919, just a few months after the end of the war, John Moody says: Not
Legislative action pp. 360-364
nd Schuster, 1971), Vol. II, p. 424. 2. Act of 1816, Section 20, 3 Stat. at 191. 3. Rothbard, Mystery, p. 203.
First deliberate US monetary contraction begins pp. 360-364
s the same. My, how the apples do fall. The country’s first experience with a deliberately created mone- tary contraction began in
The Panic of 1819 pp. 360-364
erywhere; and recovery is long delayed. This is exactly what happened in the so-called panic of 1819. In the Documentary History o
Alabama creates a state bank via bond issue pp. 379-383
tones of our modern-day banking system. Alabama, for example, in 1835 created a state bank funded by a public bond issue of $13,80
Massachusetts banks collapse in 1837 contraction pp. 379-383
-reserve banking beeen to shrink again. Consequently, oe monetary contraction of 1837 “was like a scythe over the crop,” says Gros
Founding or establishment pp. 379-383
lative mania swept through the economy. By 1862, even though the law still limited bank notes to two times capital, the banks had
Financial crisis or panic pp. 197-202
e economy plunged back into depression. When a similar crisis with still more bank failures struck again in 1839, Parliament attem
Bank of England faces 1890 speculation crisis pp. 197-202
Act of 1844 was once more suspended.... In 1890, the Bank of England once again faced crisis, again the result of widespread and e
Coinage Act of 1849 pp. 338-341
Congress did not create a “gold dollar.” (It didn’t do that until fifty-seven years later in The Coinage Act of 1849.) In fact it
War or conflict pp. 384-388
ue was primarily a matter of economics. The relative unimportance of slavery as a cause for war was made clear by Lincoln himself
War or conflict pp. 384-388
so, and I have no inclination to do so. Even after the outbreak of war in 1861, Lincoln confirmed his previous stand. He declared:
National Banking Act of 1863 pp. 403-407
all transactions—under penalty of law. The National Banking Act of 1863 required banks to keep a percentage of their notes and de
Financial crisis or panic pp. 32-36
it usually was forced into bankruptcy. Historian John Klein tells us that “The financial panics of 1873, 1884, 1893, and 1907 wer
Financial crisis or panic pp. 32-36
depositors is called a currency drain. In 1910, the most common cause of a bank having to declare bankruptcy due to a currency dr
Founding or establishment pp. 32-36
even to the “capitalist system” itself. But, in 1910, such a bankers’ utopia had not yet been created. If the Downtown bank began
Legislative action pp. 296-300
re of the British side of this contest. With regard to the Boers’ side, Professor Quigley tells the amazing story: By a process wh
Founding or establishment pp. 85-89
protect them in their economic affairs. And so, when more than 1900 S&Ls went belly-up in the Great Depression, Herbert Hoover—and
Legislative action pp. 85-89
all, insured by the federal government. In 1979, Federal Reserve policy had pushed up interest rates, and the S&Ls had to keep pac
Event pp. 85-89
it, high-risk real-estate developments. Deals began to go sour, and 1979 was the first year since the Great Depression of the 1930
Russo-Japanese War begins pp. 277-282
d a major role in shaping these events. This amazing story begins with the war between Russia and Japan in 1904. Jacob Schiff, who
Congress passes the Aldrich-Vreeland Act pp. 453-457
irection was openly a stop-gap measure. In 1908, Congress passed the Aldrich-Vreeland Act which, basi- cally, accomplished two obj
Legislative action pp. 477-480
rats to bring forth their own proposal. In fact, that process had begun even before the election of 1912. One of the most outspoke
Event pp. 12-16
se institutions were eventually junked. Finally, there is an analysis of the Federal Reserve itself and its dismal record since 19
Legislative action pp. 24-27
these groups is probably conservative. In 1913, the year that the Federal Reserve Act became law, a subcommittee of the House Com
War or conflict pp. 24-27
f our new currency system, was written. In 1930, Paul Warburg wrote a massive book—1750 pages in all—entitled The Federal Reserve
Legislative action pp. 37-40
n of a cartel as one is likely to find. In 1914, one year after the Federal Reserve Act was pasted into law, Senator Aldrich could
Legislative action pp. 37-40
ks together joint owners of a 1. See J. Lawrence Laughlin, The Federal Reserve Act: Its Origin and Problems (New York: Macmillan,
War or conflict pp. 41-45
tton, Wall Street and F.D.R., p. 94. 2. Harold Kellock, “Warburg, the Revolutionist,” The Century Magazine, May 1915, pr79: Jekyl
War or conflict pp. 272-276
l declaration. According to Franklin D. Roosevelt, then Assistant Secretary of the Navy, the Navy Department began extensive purch
War or conflict pp. 259-262
he ultimate good of world gov- ernment. With the arrival of 1917, the President was planting hints of both war and world governmen
Financial crisis or panic pp. 301-305
the people. They simply have the guns. The basic facts of this so-called revolution are described by Professor Leonard Schapiro i
Event pp. 492-495
currency, which took place in 1920.... The Federal Reserve Board met in a meeting which was not disclosed to the public—they met
Federal Reserve Board triggers 1920 credit contraction pp. 492-495
e Document 310 of February 10, 1923.... Under action taken by the Reserve Board on May 18, 1920, there resulted a violent contract
Financial crisis or panic pp. 496-499
apter ten for details. 2. See Robert T. Patterson, The Great Boom and Panic; 1921-1929 (Chicago: Henry Regnery Company, 1965), p.
Event pp. 505-509
dreds of country banks were closed. UP! In 1921, the Fed lowered interest rates to stop the recession and to help the governments
Event pp. 505-509
tion and expanding debt resulted. DOWN! In 1923, the Fed tightened credit to put the brakes on inflation. UP! But that was offset
Event pp. 500-504
e govern- ment was getting out of debt. Before 1922, the Federal Reserve bought Treasury bonds pri- marily for three purposes: (1)
War or conflict pp. 500-504
cost of war had been financed by debt. Murray Rothbard reminds us that, on the eve of depres- sion in 1928, ten years after the e
Legislative action pp. 500-504
Media, 1974). 2. Larry Schweikart, ed. The Encyclopedia of American History and Biography (New York: Facts on File, 1990), p. 448
War or conflict pp. 443-446
d about British fortunes than American. In a letter written in May of 1924 to Secretary of the Treasury Andrew Mellon, he discusse
Financial crisis or panic pp. 443-446
kets making them less competitive; U.S. exports began to decline; unemployment began to rise; low interest rates and easy credit l
Legislative action pp. 412-424
nvestigation. Someone was protected. 1. Izola Forrester, This One Mad Act (Boston: Hale, Cushman & Flint, 1937), pesod: GREENBACK
Event pp. 203-207
t. In short, all money would disappear. Marriner Eccles was the Governor of the Federal Reserve Sys- tem in 1941. On September 30
Financial crisis or panic pp. 263-266
onal Geographic, April, 1994, p. 74. 3. Winston Churchill, The World Crisis (New York: Scribner’s Sons, 1949), p. 300. This appear
War or conflict pp. 393-397
ted out. 1. Catton and Ketchum, p. 250. Also Otto Eisenschiml, The Hidden Face of the Civil War (New York: Bobbs-Merril, 1961), p.
Event pp. 182-186
herefore, is a hidden tax. 1. Andrew C. McLaughlin, The Confederation and the Constitution (New York: Collier Books, 1962), pp. 10
Financial crisis or panic pp. 182-186
zero, then it has made the complete 1. As quoted by Lever and Huhne, Debt and Danger: The World Financial Crisis (New York: The A
War or conflict pp. 618-620
, Murray N. America’s Great Depression. Kansas City: Sheed and Ward, 1963. . Conceived in Liberty: The Revolution
War or conflict pp. 28-31
years before the book was published. 2. James Warburg, The Long Road Home (New York: Doubleday, 1964), p. 29. 3. Nathaniel Wright
Event pp. 166-170
it is done through the banking system. The consequences of that process were summarized in 1966 by Alan Greenspan who, a few year
Legislative action pp. 515-519
depression that followed. 1. Curtis B. Dall, FDR: My Exploited Father-In-Law (Tulsa, Oklahoma: Christian Crusade Publications, 19
War or conflict pp. 540-543
he was “a member of the conspiracy.” 1. “News of War and Peace You're Not Ready For,” by Herschel McLandress, Book World, in The W
Legislative action pp. 61-64
ke Mechanism. 2. Welles, pp. 407-08. 3. “Congress Clears Railroad Aid Bill, Acts on Strike,” 1970 Congressional Almanac (Washingto
Legislative action pp. 61-64
s expenditures would hardly be noticed. By 1977, Lockheed had, indeed, paid back this loan, and that fact was widely advertised as
Financial crisis or panic pp. 79-84
RAK and continues to operate at a loss. In 1970, as Lockheed faced bankruptcy, Congress heard essentially the same story. Thousand
Financial crisis or panic pp. 79-84
ks continued to receive their interest. In 1978, Chrysler was on the verge of bankruptcy. Congress was informed that the public
IMF creates the Special Drawing Right pp. 105-109
ling inexorably toward its destination. In 1970, the IMF created a new monetary unit called the SDR, or Special Drawing Right. The
War or conflict pp. 105-109
: Western Islands, 1966), pp. 30, ol 2. See: David Rees, Harry Dexter White: A Study in Paradox (New York: Coward, McCann & Geoghe
Event pp. 65-68
iality rule was, in fact, an exception. In 1971, Unity Bank and Trust Company in the Roxbury section of Boston found itself hopele
Financial crisis or panic pp. 128-131
ithin The 1. Michael Crozier, Samuel P. Huntington, and Joji Watanuki, The Crisis of Democ- racy (New York: New York University Pr
Congress passes the Monetary Control Act pp. 132-136
would have to be done with mere money. To pave the way for that, Congress passed the Monetary Control Act of 1980 which authorize
Legislative action pp. 46-50
t expect those loans ever to be repaid. When Walter Wriston was chairman of the Citicorp Bank in 1982, he extolled the virtue of t
Penn Square Bank fails in Oklahoma pp. 69-73
hers which were more prudently managed. The gaudy fabric began to unravel during the Fourth of July weekend of 1982 with the failu
Event pp. 430-433
esult of competition from all sides. 1. Eustace Mullins, Secrets of the Federal Reserve (Virginia: Bankers Research Institute, 198
War or conflict pp. 255-258
d Office, London, as cited by Robert H. Ferrell, Woodrow Wilson and World War I (New York: Harper & Row, 1985), p. 35. 2. Ferrell,
Financial crisis or panic pp. 114-118
those required for economic growth. 1. “How ‘Experts’ Caused the Third World Debt Crisis,” by Paul Craig Roberts, Business Week,
Bailout or intervention pp. 90-94
ebt to help finance this assistance.... But the 1988 thrift rescues’ most expensive flaw doesn’t appear to be the enrichment of ty
Event pp. 212-217
sh and deposits at the Federal Reserve. See Regulation D; Reserve Requirements of Depository Institutions, Federal Reserve documen
War or conflict pp. 408-411
(New York: Houghton Mifflin, 1957). 2. “No Civil War at All, Part Two,” by William Mcllhany, Journal of Individualist Studies, Fa
Legislative action pp. 548-551
cannot say that we were not warned. 1. Michail Gorbachev, “The River of Time and the Necessity of Action,” 46th John Findley Gree
Financial crisis or panic pp. 615-617
Harper & Row, 1985. Figgie, Jr., Harry. Bankruptcy 1995: The Coming Collapse of America and How to Stop It. gees Little, cake ad C
Representative Traficant Condemns 'Foreign Stupidity' pp. 323-328
America gives billions to Russia. With American cash, Russia builds missiles. Russia then sells those missiles to China
Colonial Price Inflation from Fiat Money pp. 329-333
By the late 1750s, Connecticut had price inflated by 800%, the Carolinas had inflated 900%, Massachusetts 1000%, Rhode Island 2300%
Economic Recovery After Fiat Money Ban pp. 329-333
It remained so even during the economic strain of the Seven-Years War (1756-1763) and during the period immediately prior to the Revolution
Revolutionary War Begins with Currency Inflation pp. 329-333
At the beginning of the war in 1775, the total money supply for the federated colonies stood at $12 million
Continental Currency Inflation Leads to Worthlessness pp. 329-333
In 1775, the colonial monetary unit, called the Continental, was valued at one-dollar in gold. In 1778, it was exchanged for twenty-five cen…
Washington Witnesses Continental Currency Collapse pp. 329-333
A wagon-load of money will scarcely purchase a wagon-load of provisions
Constitutional Convention Debate on Fiat Money pp. 329-333
as the opening session convened in Philadelphia in 1787, there were angry mobs in the streets threatening the legislators. Looting was rampa…
Jefferson Warns Against Permanent National Debt pp. 347-350
I wish it were possible to obtain a single amendment to our Constitution. I would be willing to depend on that alone for the reduction of th…
First Bank of the United States charter expires pp. 351-354
on January 24, 1811, the Bank of the United States closed its doors
War of 1812 Driven by Banking Interests pp. 355-359
The War of 1812 was one of the most senseless wars in history
Founding of the Second Bank of the United States pp. 360-364
In 1816, the postwar boom was full on
Pennsylvania Charter Explosion in New Banks pp. 360-364
Pennsylvania chartered thirty-seven new banks in 1817
Andrew Jackson elected President pp. 365-368
After Jackson was elected to the Presidency in 1828
Second Bank of the United States charter expires pp. 374-378
expired in 1836 and it was restructured as a state bank
Congress passes the National Banking Act pp. 403-407
On February 25, 1863, Congress passed the National Banking Act
Lincoln's Greenback Currency Inflation pp. 403-407
During the war, the purchasing power of the greenbacks fell by 65%. The money supply increased by 138%. Prices more than doubled
Hazard Circular Reveals Banking Strategy pp. 403-407
The great debt that capitalists will see to it is made out of the war must be used as a means to control the volume of money
Lincoln's Lincoln's Fears of Money Power pp. 403-407
The money power preys upon the nation in times of peace and conspires against it in times of adversity. It is more despotic than monarchy
Even before the 1873 panic, a new way of dealing with railro pp. 425-429
the so-called panics of 1873, 1884, 1893, and 1907. Each of them was characterized by inadequate bank reserves
Death of J.P. Morgan Sr. pp. 434-438
When J.P. Morgan, Sr., died in 1913, people were shocked
New York stock market crash of 1929 pp. 515-519
There is no better illustration of that law than the Crash of 1929
Public Opposition to Money Trust Fuels Fed Creation pp. 486-491
In 1913, public distaste for concentration of financial power in the hands of a few Wall Street banks helped to fuel the fire for passage of…
Benjamin Strong Dominates Federal Reserve System pp. 486-491
Strong ruled as an autocrat, determining Fed policy often without even consulting with the Federal Reserve Board in Washington