“It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
-Henry Ford, American car manufacturer and industrialist
Where does our money come from, and who controls it? In part one of this blog, we took a closer look at 15 little-known facts about the United State Federal Reserve banking system. Here are 15 more facts about the most powerful, clandestine and controversial monetary entity on the planet, the FED:
1. The organizational structure of the Federal Reserve System leaves unprecedented power in the hands of a small number of private citizens, not federal agencies or elected officials. In fact, the Federal Reserve is made up of only three parts:
The Federal Reserve Banks
The Board of Governors
The Federal Open Market Committee
2. Believe it or not, the Federal Reserve may be leading U.S. monetary policy and distribution, but each of the individual 12 regional Reserve Banks are actually organized “much like private corporations,” with corporate shares sold to the private commercial national banks in that district!
3. This is no accident or oversight, as the Federal Reserve was first established as exactly that – a private central bank, with other private major banks as their shareholders, even though the FED took over responsibility for monetary policy from Congress.
4. Representatives of the Federal Reserve not only don’t deny this, they have stated repeatedly and adamantly in federal court that the organization is “not an agency” of the federal government. Therefore, the FED is not subject to the Freedom of Information Act or other laws, monitoring and restrictions. Unbelievably, the exact shareholdings and financials of the Fed and its dealings are not even a matter of public record!
5. Where does the FED get its legal authority to serve as the warden of the U.S. economy? It’s certainly not from the Constitution. In fact, according to Article I, Section 8 of the U.S. Constitution, the U.S. Congress is the only entity that has the power and responsibility to “coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures.
6. So how did the FED come to power? Instead of being empowered by the U.S. Constitution, the Federal Reserve was actually born out of an act of Congress, the Glass-own bill, also known as The Federal Reserve Act, on December 23rd, 1913. That bill passed after a majority of the Senate voted for it, although the bill was conspicuously introduced right before a holiday, so time and attendance for a vigorous debate were limited. So the Reserve Banks that make up the now-centralized FED first opened on November 16th, 1914.
7. The Banking Act of 1935, enacted after the Great Depression, changed the name to the Federal Reserve System, reorganizing the number of FED directors and length of their terms.
8. Not coincidentally, a permanent income tax on U.S. citizens was introduced the same year that the Federal Reserve system was established, effective setting up a nonstop pipeline of funds from private citizens to the federal government and then into the private banking system. It still works that way today, with The Federal Reserve System turning over its operating profits to the U.S. Treasury after deducting their long list of expenses, including a 6% dividend they pay to member banks.
9. Since the Federal Reserve was established in 1913, more than 100 years ago, the U.S. national debt has grown by more than 5,000%.
10. In fact, the U.S. government spends more than $400 billion on interest payments alone on our national debt every year. If the interest on our national debt rises just to 6% (it’s been much higher at times in the past), our annual interest payments will be more than a trillion dollars a year.
11. In 1970, the five largest U.S. banks held 17 percent of all the assets and money in the U.S. banking system. But these days, the five largest U.S. banks hold the majority of all U.S. banking industry assets at 52%.
12. The disparity of wealth has never been greater in this country. In fact, the gap in wealth between the top 1% and the rest of the U.S. population is now the largest it’s been since the 1920s.
13. Although it somehow avoided being on the evening news, the Federal Reserve made $16.1 trillion in secret loans to the largest banks during the last financial crisis according to official government reports.
Those loan recipients include:
Citigroup – $2.513 trillion
Morgan Stanley – $2.041 trillion
Merrill Lynch – $1.949 trillion
Bank of America – $1.344 trillion
Barclays PLC – $868 billion
Bear Sterns – $853 billion
Goldman Sachs – $814 billion
Royal Bank of Scotland – $541 billion
JP Morgan Chase – $391 billion
Deutsche Bank – $354 billion
UBS – $287 billion
Credit Suisse – $262 billion
Lehman Brothers – $183 billion
Bank of Scotland – $181 billion
BNP Paribas – $175 billion
Wells Fargo – $159 billion
Dexia – $159 billion
Wachovia – $142 billion
Dresdner Bank – $135 billion
Societe Generale – $124 billion
“All Other Borrowers” – $2.639 trillion
14. In just the five years after the financial collapse, The Federal Reserve “created” approximately 2.75 trillion dollars and injected it into the banking system, which helped revitalize the economy and the stock market, but rendered our whole economy extremely unstable.
15. If you check the backside of every $1 bill (Federal Reserve Note) printed after 1035, you’ll see writing that appears on the seal. It says, “Annuit Coeptis,” which is Latin for “Providence Favors our Undertakings” and also “Novus Ordo Seclorum,” which is also Latin, meaning “New Order of the Ages.”