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Beast from Jeckyll Island 

The Bankers Manifesto of 1892 


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16th amendment not ratified - income tax illegal  

Money myth   

Gold Standard 

Usury / interest 

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Creature from Jekyll Island (book review) - 
exposing the Fed and common money myths


The financial enigma resolved  

A debt money system  
by Louis Even

1. Shipwreck survivors

An explosion had blown their ship apart. Each one grasped the first bit of wreckage that came to hand, And when it was over there were five left, five huddled on a raft which the waves carried along at their will, As for the other victims of the disaster, there was no sign of them.

Hour after long hour their eyes searched the horizon. Would some passing ship sight them? Would their makeshift raft find its way to some friendly shore? Suddenly a cry rang out: "Land! Look! Over there in the direction the waves are carrying us!" And as the vague silhouette proved itself to be, in fact, the outline of a shore, the figures on the raft danced with joy. They were five, five Canadians. There was Frank, the carpenter, big and energetic, It was he who had first cried, "Land!" Then Paul, a farmer. You can see him on his knees, one hand against the floor, the other gripping the mast of the raft. Next Jim, an animal breeder; he's the one in the striped pants, kneeling and gazing in the direction of land. Then there is Harry, an agriculturist, a little on the stout side, seated on a trunk salvaged from the wreck. And finally Tom, a prospector and a mineralogist; he is the merry fellow standing in the rear with his hand on the carpenter's shoulder.

2. A Providential island

To our five men, setting foot on land was like returning to life from the grave.

When they had dried and warmed themselves their first impulse was to explore this little island on to which they had been cast, far from civilization. A quick survey was sufficient to raise their spirit. The island was not a barren rock. True enough, they were the only men on it at the moment. But judging from the herds of semi domesticated animals they encountered, there must have been men here at some time before them. Jim, the animal breeder, was sure he could completely domesticate them and put them to good service.

Paul found the island's soil, for the most part, to be quite suitable for cultivation. Harry discovered some fruit trees which, if properly tended, would give good harvests. Most important were the large stands of timber embracing many types of wood. Frank, without too much difficulty, would be able to build houses for the little community.

As Tom, the prospector, well, the rock formations of the island showed signs of rich mineral deposits, Lacking the tools, Tom still felt his ingenuity and initiative could produce metals from the ores. So each could serve the common good with his special talent. All agreed to call the place Salvation Island. All gave thanks to Providence for the reasonably happy ending to what could have been stark tragedy.

3. True wealth

Here are the men at work. The carpenter builds houses and makes furniture. At first they find their food where they can. But soon the fields are tilled and seeded, and the farmer has his crops. As season followed season this island, this heritage of the five men, Salvation Island, became richer and richer. Its wealth was not that of gold or of paper bank notes, but one of true value; a wealth of food and clothing and shelter, of all the things to meet human needs. Each man worked at his own trade. Whatever surpluses he might have of his own produce, he exchanged for the surplus products of the others. Life wasn't always as smooth and complete as they could have wished it to be. They lacked many of the things to which they had been accustomed in civilization. But their lot could have been a great deal worse. Besides, all had experienced the depression in Canada. They still remembered the empty bellies side by side with stores crammed with food. At least, on Salvation Island, they weren't forced to see the things they needed rot before their eyes. Taxes were unknown here. Nor did they go in constant fear for seizure by the bailiff. They worked hard but at least they could enjoy the fruits of their toil.

So they developed the island, thanking God and hoping for the day of reunion with their families still in possession of life and health, those two greatest of blessings.  

4. A serious inconvenience

Our men often got together to talk over their affairs. Under the simple economic system which had developed, one thing was beginning to bother them more and more; they had no form of money. Barter, the direct exchange of goods for goods, had its drawbacks. The products to be exchanged were not always at hand when a trade was discussed. For example, wood delivered to the farmer in winter could not be paid for in potatoes until six months later. Sometimes one man might have an article of considerable size which he wished to exchange for a number of smaller articles produced by different men at different times. All this complicated business and laid a heavy burden on the memory. With a monetary system, however, each one could sell his products to the others for money. With this money he could buy from the others the things he wanted, when he wished and when they were available.

It was agreed that a system of money would indeed be very convenient. But none of them knew how to set up such a system. They knew how to produce true wealth - goods. But how to produce money, the symbol of this wealth, was something quite beyond them. They were ignorant of the origin of money, and needing it they didn't know how to produce it. Certainly, many men of education would have been in the same boat; all our governments were in that predicament during the ten years prior to the war. The only thing the country lacked at that time was money, and the governments apparently didn't know what to do to get it.

5. Arrival of a refugee

One evening when our boys were sitting on the beach going over their problem for the hundredth time, they suddenly saw approaching, a small boat with a solitary man at the oars. They learned that he was the only survivor of a wreck. His name, Olivier. Delighted to have a new companion they provided him with the best they had and took him on an inspection tour of the colony.  

"Even though we're lost and cut off from the rest of the world," they told him, "we haven't too much to complain about. The earth and the forest are good to us. We lack only one think - money. That would make it easier for us to exchange our products."

"Well, you can thank Providence," replied Olivier, "because I am a banker and in no time at all I'll set up a system of money guaranteed to satisfy you. Then you'll have everything that people in civilization have."

A banker!... A BANKER!... An angel coming down out of the clouds couldn't have inspired more reverence and respect in our men. For, after all, are we not accustomed, we people in civilization, to genuflect before bankers, those men who control the life-blood of finance?

6. Civilization's god

" Mr. Oliver, as our banker, your only occupation on this island will be to look after our money; no manual labor."

"I shall, like every other banker, carry out to complete satisfaction my task of forging the community's prosperity."

"Mr. Oliver, we're going to build you a house that will be in keeping with your dignity as a banker. But in the meantime, do you mind if we lodge you in the building we use for our get-togethers?

"That will suit me, my friends. But first of all, unload the boat. There's paper, and a printing press, complete with ink and type; and there's a little barrel which I exhort you to treat with the greatest care."

They unloaded everything. The small barrel aroused intense curiosity in our good fellows.

"This barrel," Oliver announced, "contains treasure beyond dreams. It is full of... gold!"

Full of gold! The five all but swooned. The god of civilization here on Salvation Island! The yellow god, always hidden, yet terrible in its power; whose presence or absence or slightest caprice could decide the very fate of all the civilized nations!

"Gold! Mr. Oliver, you are indeed a great banker!" "Oh august majesty! oh honorable Oliver! great high priest of the god, gold! accept our humble homage and receive our oaths of fealty!"

"Yes, my friends, gold enough for a continent. But gold is not for circulation. Gold must be hidden. Gold is the soul of healthy money, and the soul is always invisible. But I'll explain all that when you receive your first supply of money."  

7. The secret burial

Before they went their separate ways for the night, Oliver asked them one last question.

"How much money will you need to begin with in order to facilitate trading?"

They looked at one another then deferentially towards the banker. After a bit of calculation and with the advice of the kindly financier, they decided that $200 each would do. The men parted, exchanging enthusiastic comments. And in spite of the late hour, they spent most of the night lying awake, their imaginations excited by the picture of gold. It was morning before they slept. As for Oliver, he wasted not a moment. Fatigue was forgotten in the interests of his future as a banker. By dawn's first light he dug a pit into which he rolled the barrel. He then filled it in, transplanting a small shrub to the spot about which he carefully arranged sod. It was well hidden. Then he went to work with his little press to turn out a thousand $1 bills. Watching the clean new banknotes come from his press, the refugee turned banker, thought to himself:

"My! how simple it is to make money. All its value comes from the products it will buy. Without produce these bills are worthless. My five naive customers don't realize that. They actually think that this new money derives its value from gold! Their very ignorance makes me their master."

And as evening drew on, the five came to Oliver -- on the run.

8. Who owns the new money?

Five bundles of new banknotes were sitting on the table.

"Before distributing the money," said the banker, "I would like your attention.

"Now, the basis of all money is gold. And the gold stored away in the vault of my bank is my gold. Consequently, the money is my money. Oh! don't look so discouraged. I'm going to use it as you see fit. However, you'll have to pay interest. Considering that money is scarce here, I don't think 8% is unreasonable."

"Oh, that's quite reasonable, Mr. Oliver."

"One last point, my friends. Business is business, even between pals. Before you get the money, each of you is going to sign a paper. By it you will bind yourselves to pay both interest and capital under penalty of confiscation of property by me. Oh! this is a mere formality. Your property is of no interest to me. I'm satisfied with money. And I feel sure I'll get my money and that you'll keep your property."

"That makes sense, Mr. Oliver. We're going to work harder than ever in order to pay you back."

"That's the spirit. And any time you have a problem, come and see me. Your banker is your best friend. Now, here's two hundred dollars for each of you."

And our five brave fellows went away, their hands full of dollar bills, their heads swimming with the ecstasy of having money.  

9. A problem in arithmetic

And so Oliver's money went into circulation on the island. Trade, simplified by money, doubled. Everybody was happy. And the banker was always greeted with unfailing respect and gratitude. But now, let's see... Why does Tom, the prospector, look so grave as he sits busily figuring with a pencil and paper? It is because Tom, like the others, has signed an agreement to repay Oliver, in one year's time, the $200 plus $16 interest. But Tom has only a few dollars in his pocket and the date of payment is near. For a long time he wrestled with the problem from his own personal point of view, without success. Finally he looked at it from the angle of the little community as a whole.

"Taking into consideration everyone on the island as a whole, he mused, "are we capable of meeting our obligations? Oliver turned out a total of $1000. He's asking in return $1080. But even if we bring him every dollar bill on the island we'll still be $80 short. Nobody made the extra $80. We turn out produce, not dollar bills. So Oliver can take over the entire island since all the inhabitants together can't pay him back the total amount of capital and interest.

"Even if a few, without any thought for the others, were able to do so, those others would fall. And the turn of the first spared would come eventually. The banker will have everything. We'd better hold a meeting right away and decide what to do about it."

Tom with his figures in his hand, had no difficulty in proving the situation. All agreed they had been duped by the kindly banker. They decided upon a meeting at Oliver's.

10. The benevolent banker

Oliver guessed what was on their minds but put up his best front. While he listened, the impetuous Frank stated the case for the group.

"How can we pay you $1080 when there is only $1000 on the entire island?"

"That's the interest, my friends. Hasn't your rate of production increased?"

"Sure, but the money hasn't. And it's money you're asking for, nor our products. You are the only one who can make money. You've made only $1000 and yet you ask $1080. That's an impossibility!"

"Now listen, fellows. Bankers, for the greater good of the community, always adapt themselves to the conditions of the times. I'm going to require only the interest. Only $80. You will go on holding the capital."

"Bless you, Mr. Oliver! Are you going to cancel the $200 each of us owes you?"

"Oh no! I'm sorry, but a banker never cancels a debt. You still owe me all the money you borrowed. But you’ll pay me, each year, only the interest. If you meet the interest payments faithfully each year I won't push you for the capital. Maybe some won't be able to repay even the interest because of the money changing hands among you. Well, organize yourselves like a nation. Set up a system of money contributions, what we call taxes. Those who have more money will be taxed more: the poor will pay less. See to it that you bring me in one lump sum, the total of the amount of interest and I'll be satisfied. And your little nation will thrive."

So our boys left, somewhat pacified but still dubious.

11. Oliver exults

Oliver is alone. He is deep in reflection. His thoughts run thus:

"Business is good. These boys are good workers, but stupid. Their ignorance an naivety is my strength. They ask for money and I give them the chains of bondage. They give me orchids and I pick their pockets. True enough, they could mutiny and throw me into the sea. But pshaw! I have their signatures. They're honest, hardworking people were put into this world to serve the financiers. Oh great Mammon! I feel your banking genius coursing through my entire being! Oh, illustrious master! how right you were when you said: "Give me control of a nation's money and I won't mind who makes its laws." I am the master of Salvation Island because I control its money. My soul is drunk with enthusiasm and ambition. I feel I could rule the universe. What I, Oliver, have done here, I can do throughout the entire world. Oh! if only I could get off this island! I know how I could govern the world without wearing a crown. My supreme delight would be to install my philosophy in the minds of those who lead society: bankers, industrialists, politicians, reformers, teachers, journalists -- all would be my servants. The masses are content to live in slavery when the elite from among them are constituted their overseers."

12. The cost of living unbearable

Meanwhile things went from bad to worse on Salvation Island. Production was up, bartering had dropped to a minimum. Oliver collected his interest regularly. The others had to think of setting money aside for him. Thus, money tended to clot instead of circulating freely. Those who paid the most in taxes complained against those who paid less. They raised the prices of their goods to compensate for this loss. The unfortunate poor who paid no taxes lamented the high cost of living and bought less. Morale was low. The joy went out of living. No one took an interest in his work. Why should he? Produce sold poorly. When they made a sale they had to pay taxes to Oliver. They went without things. It was a real crisis. And they accused one another of wanting in charity and of being the cause of the high cost of living. One day, Harry, sitting in his orchard, pondered over the situation. He finally arrived at the conclusion that this "progress", born of a refugee's monetary system, had spoiled everything on the island. Unquestionably all five had their faults; but Oliver's system seemed to have been specifically designed to bring out the worst in human nature.

Harry decided to demonstrate this to his friends and to unite them for action. He started with Jim, who was not hard to convince. "I'm no genius", he said, "but for a long time now there's been a bad smell about this banker's system." One by one they came to the same conclusion and ended by deciding upon another conference with Oliver.

13. Interview with the unshackle

A veritable tempest burst about the ears of the banker.

"Money's scarce on the island, fellow, because you take it away from us! We pay you and pay you and still owe you as much as at the beginning. We work our heads off! We've the finest land possible and yet we're worse off than before the day of your arrival. Debts! Debts! up to our necks in debts!"

"Oh! now boys, be reasonable! Your affairs are booming and it's thanks to me. A good banking system is a country's best asset. But if it is to work beneficially you must have faith in the banker. Come to me as you would to a father... is it more money you want? Very well. My barrel of gold is good for many thousands of dollars more. See, I'm going to mortgage your latest acquisitions and lend you another thousand dollars right now."

"So! Now our debt goes up to $2000! We are going to have twice as much interest to pay for the rest of our lives!"

"Well, yes -- but I'll lend you more whenever the value of your property increases. And you'll never pay anything but the interest. You'll lump all your debts into one -- what we call a consolidated debt. And you can add to the debt year after year."

"And raise the taxes year after year?"

"Obviously. But your revenues also increase every year."

"So then, the more the country develops each year because of our labor, the more the public debt increases!"

"Why, of course! Just as in your Canada -- or in any other part of the civilized world for that matter. The degree of a country's civilization is always gauged by the size of its debt to the bankers".

14. The wolf devours the lambs

"And that's a healthy monetary system, Mr. Oliver?"

"Gentlemen, all sound money is based on gold and it comes from the banks in the form of debts. The national debt is a good thing. It keeps men from becoming too satisfied. It subjugates governments to the supreme and ultimate wisdom, that which is incarnate in bankers. As a banker, I am the torch of civilization here on your little island. I will dictate your politics and regulate your standard of living."

"Mr. Oliver, we're simple uneducated folks, but we don't want that kind of civilization here. We'll not borrow another cent off you. Sound money or not, we don't want any further transactions with you."

"Gentlemen, I deeply regret this very ill-advised decision of yours. But if you break with me, remember, I have your signatures. Repay me everything at once -- capital and interest."

"But that's impossible, sir. Even if we give you all the money on the island we still won't be square with you."

"I can't help that. Did you or did you not sign? Yes? Very well. By virtue of the sanctity of contracts I hereby seize your mortgaged property which was what you agreed to at the time you were so happy to have my help. If you don't want to serve willingly the supreme authority of money then you'll obey by force. You'll continue to exploit the island, but in my interests and under my conditions. Now, get out! You'll get your orders from me tomorrow."

15. Control of the press

Oliver knew that whoever controlled the nation's money, controlled the nation. But he knew also that to maintain that control it was necessary to keep the people in a state of ignorance and to distract them by a variety of means. Oliver had observed that of the five islanders, two were conservatives and three were liberals. That much had evolved from their evening conversations, especially after they had fallen into slavery. And between the conservatives and those who were liberals, there was constant friction. On occasions, Harry, the most neutral of the five, considering that all had the same needs and aspirations, had suggested the union of the people to put pressure on the authorities. Such a union, Oliver could not tolerate; it would mean the end of his rule. No dictator, financial or otherwise, could stand before a people united and educated. Consequently, Oliver set himself to foment, as much as possible, political strife between them. The refugee put his press to work turning out two weekly newspapers, "The Sun" for the liberals and "The Star" for the conservatives.

The general tenor of "The Sun" was: "If you are no longer master, it is because of those traitorous conservatives who have sold out to big business". That of "The Star": "The ruinous state of business and the national debt can be traced directly to the political responsibility of those unmentionable liberals". And the two factions wrangled ferociously, forgetting the one who had forged their chains, that money master, the banker Oliver.

16. A priceless bit of flotsam

One day, Tom, the prospector on a small beach hidden by tall grass at one end of the island, found a lifeboat, empty except for a trunk in good condition lying in the bottom of it. He opened the trunk. Among the articles within, a sort of album caught his eye: "The First Year of Social Credit". Between the covers he found the first volume of a Social Credit publication from Canada. Curious, Tom sat down and began to read the volume. His interest grew; his face lit up.

"Well just look at this!" he cried out loud. "This is something we should have known a long time ago."

"Money gets its value, not from gold, but from the products which that money buys.

"Simply put, money should be a sort of accountancy, credits passing from one account to another according to purchases and sales. The sum total of production.

"Each time production increases there is a corresponding increase in the amount of money. Never at any time should interest be paid on new money. Progress is marked, not by an increase in the public debt, but by the issuance of an equal dividend to each individual... Prices are adjusted to the general purchasing power by a coefficient of prices. Social Credit..."

But Tom could no longer contain himself. He got up and set off at a run, the book in his hands, to share this glorious discovery with his four comrades.

17. Money-- elementary accounting

So Tom became the teacher. He taught the others what he had learned from that God-sent Social Credit publication.

"This", he said, "is what we can do without waiting for a banker and his keg of gold or without underwriting a debt.

"I open an account in the name of each of you. In the right hand column are the credits which increase your account; to the left are the debits which substract from your account. Each wants $200 to begin with. Very well. We write $200 to the credit of each. Each immediately has $200. Frank buys some goods from Paul for $10. I deduct $10 from Frank leaving him $190. I add $10 to Paul and he now has $210. Jim buys from Paul to the amount of $8. I deduct from Jim $8 leaving him $192. Paul now has $218. Paul buys wood from Frank for $15. I deduct $15 from Paul leaving $203. I add $15 to Frank's account and it goes back to $205.

"And so we continue; from one account to another in the same fashion as paper banknotes go from one man's pocket to another's. If someone needs money to expand production, we issue him the necessary amount of new credit. Once he has sold his products he repays the sum to the credit fund. The same with public works; paid for by new credits. Likewise, each one's account is periodically increased but without taking credits from anyone, in order that all may benefit from the progress society makes. That's the national dividend. In this fashion money becomes an instrument of service."

18. The banker's despair

Everyone understood. The members of this little community became Social Crediters. The following day, Oliver, the banker, received a letter signed by the five:

"Dear sir' without the slightest necessity you have plunged us into debt and exploited us. We don't need you anymore to run our money system. From now on we'll have all the money we need without gold, debts or thieves. We are establishing, at once, the system of Social Credit on the island. The national dividend is going to replace the national debt. If you insist on being repaid, we can repay you all the money you gave us. But not a cent more. You cannot lay claim to that which you have not made."

Oliver was in despair. His empire was crumbling. His dreams shattered. What could he do? Arguments would be futile. The five were now Social Crediters: money and credit were now not more mysterious to them than they were to Oliver.

"Oh!", said Oliver, "these men have been won to Social Credit. Their doctrine will spread far more quickly than mine. Should I beg forgiveness? become one of them? I, a financier and a banker? Never! Rather, I shall try and put as much distance between them and me as I can!"

19. Fraud unmasked

To protect themselves against any future claim by Oliver, our five men decided to make him sign a document attesting that he again possessed all he had when he first arrived on the island. An inventory was taken; the boat, the oars, the little press and the famous barrel of gold. Oliver had to reveal where he had hidden the gold. Our boys hoisted it from the hole with considerably less respect than the day they had unloaded it from the boat. Social Credit had taught them to despise gold. The prospector, who was helping to lift the barrel, found it surprisingly light for gold. If the barrel was full, he told the others, there was something in it besides gold. The impetuous Frank didn't waste a moment; a blow of the axe and the contents of the barrel were exposed. Gold? Not so much as a grain of it! Just rocks -- plain, worthless rocks! Our men couldn't get over the shock.

"Don't tell us he could bamboozle us to this extent! Were we such muttonheads as to go into raptures over the mere mention of gold? Did we mortgage all our possessions for a few pieces of paper based on a few pounds of rocks? It's robbery compounded by lies! To think that we sulked and almost hated one another all because of such a fraud! That devil!"

Furious, Frank raised his axe. But already the banker had taken to his legs in full flight towards the forest.

20. Farewell to Salvation Island

After the opening of the barrel and the revelation of his duplicity, nothing further was heard of Oliver. Shortly after, a ship, cruising off the normal navigation rout, noticed signs of life on this uncharted island and cast anchor a short distance offshore. The men learned that the ship was en route to America. So they decided to take with them what they could carry and return to Canada. Above all, they made sure to take back with them the album "The First Year of Social Credit" which had proven to be their salvation from the hands of the financier, Oliver, and which had illumined their minds with an inextinguishable light. All five solemnly engaged themselves to get in touch with the management of this paper, once back in Canada, and to become devoted and zealous apostles of the cause of Social Credit in Canada.



Bankers compared to counterfeiters
by Jean-Pierre Richard

In his November 1993 report, Canada's Auditor general calculated that of the $423 billion in net accumulated debt from Confederation to 1992, only $37 billion (8.75%) went on actual goods and services, all the rest (91%) consisted of interest charges. this should tell us how we all have become slaves.

A real solution is now having a phenomenal promotion throughout the world. The main facts on which it is based are now being supported and taught by top economists like, for example, Harold Chorney, Assoc. Professor of Political Economy at Concordia University, in Montreal, the late John Hotson, who was Professor of Economics at the University of Waterloo, and Mario Seccareccia, Assoc. Professor of Economics at the University of Ottawa, published a booklet in May of 96: "The Deficit Made Me Do It". In it they say: "When World War II ended, the national debt relative to the national income was more than twice as large as it is now. but was the country ruined? Did we have to declare national bankruptcy? Far from it! Instead, Canada's economy boomed, and the country prospered for most of the post war period.

"Why isn't the same thing happening today? Why was a much larger national debt shrugged off in 1945, while today's much smaller debt (as a percentage of GDP) is being used as an excuse to let the economy stagnate?

"The answer can be found at the Bank of Canada. During the war, and for 30 years afterward, the government could borrow what it needed at low rates of interest, because the government's own bank produced up to half of all the new money. That forced the private banks to keep their interest rates low, too.

"Since the mid-1970s, however, the Bank of Canada, with government consent, has been creating less and less of the new money, while letting the private banks create more and more. Today, "our" bank creates a mere 2% of each year's new money supply, ... (p. 4, 5).

"... The conventional wisdom, however, is that inflation is the greatest threat to the economy and must be restrained by raising interest rates. This flies in the face of the commonsense observation that rising prices (inflation) are caused by raising costs, and that interest rates are costs. So raising them will raise prices, not lower them. p. 8).

"... One of the most pervasive myths about the government deficit is that governments which spend more than they receive in revenue must borrow the difference, thus increasing the debt.

"In fact, a government can choose to create the needed additional money instead of borrowing it from the banks, the public, or foreigners." (p.9).

And to those who say that there are only two ways to control the deficit: one being to raise taxes, and the other to cut government spending, they say: "But, in fact, there is a third way: reduce the interest rate. The Bank of Canada can set the rate of interest at which it lends to the chartered banks at any number it chooses, and it can peg the rate on government bonds, too. This was evident during WW II When it set the rate on Treasury Bills at as little as 0.36%, and on longer term bonds at less than 2.5%." (p. 10).

Maurice Allais, Professor of Economics at the National School of Mining Engineering in Paris, France and the 1988 Nobel Prize Winner in Economics, had this to say, in his book "Les conditions monétaires d'une économie de marché" (The Monetary Conditions of a Market Economy p. 2): "In essence, the present creation of money, out of nothing, by the banking system is, I do not hesitate to say it in order to make people clearly realize what is at stake here, similar to the creation of money by counterfeiters, so rightly condemned by law. In concrete terms, it leads to the same results."

And finally, let us quote Mackenzie King, while he was campaigning, in 1935, to become Prime Minister of Canada: "Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talk of the sovereignty of Parliament and of democracy is idle and futile."

So let us work to get the government of Canada to create all new money, cash and credit , by getting our municipal and town councils and all associations to pass a resolution to this effect. And let us circulate petitions on this issue among the general public. A model resolution and petition is available from us upon request, at no cost.

Jean-Pierre Richard


Creature from Jekyll Island

Review of Creature from Jekyll Island

Killing the Banking Beast
Jane H. Ingraham
The New American
Vol 10, Number 18, September 5, 1994

Has it ever occurred to you that the federal government has no need of taxes for revenue? Are you aware that banks prefer lending to governments because governments seldom repay loans? Do you realize that if all debts, both public and private, were paid, there would be no money at all in circulation?

These are only a few of the startling facts that fill the pages of this illuminating expose of the Insider scam called The Federal Reserve System (Fed). Although author G. Edward Griffin admits to having wondered if another book on the Federal Reserve is necessary (his six pages of bibliography suggest that the subject may have previously attracted attention), it is unlikely that any book has ranged across 2,000 years of money and banking from Diocletian to the Rothschilds to Alan Greenspan — and tied it into the new world order — as thoroughly as The Creature From Jekyll Island.

Griffin cuts through the obscurities about the Fed that are intentionally meant to mystify and disarm its victims (all of us). Convinced that the subject of money and banking is too arcane and complicated to understand, we victims are trapped in a world view that utterly fails to jibe with reality. The money manipulators, says Griffin, are exploiting our ignorance for the advancement of their own appalling plans; the urgency of awakening us to our danger has driven Griffin to write this extraordinary book.

Although Griffin has never held an academic position, he is a top-notch teacher. Making this little-understood subject simple by splendid organization, his account is divided into six sections with varying numbers of chapters; each section and chapter is introduced by a concise paragraph while each chapter is also summarized. Thus the reader is kept in touch with where he has been and where he is going, an ingenious and helpful device considering the enormous scope of Griffin’s narrative.

His explanations and definitions are meticulously worded; one can sense the care with which each word was chosen, leaving no room for confusion. Griffin continually draws documentation from primary sources, quoting letters, speeches, and published works that both enlighten and horrify. His own writing is difficult to quote; it is so trenchant that nearly every sentence entices. Yet at the same time Griffin has mastered the art of speaking personally to the reader, who never loses the feeling of being directly addressed. All this adds up to a superbly clear, engrossing book that, once started, is impossible to put down.

Setting the Stage

In order to help us fully understand our present predicament, Mr. Griffin ranges far afield in explaining the historical, economic, and political antecedents of today’s money system. We are given a crash course on the nature of money; the origin of banks and the concept of fractional reserves; how this led to the seductive idea of using the same money over and over; how this inevitably led to economic disaster wherever and whenever tried. We are instructed about the Rothschild formula, which perfected the art of making enormous profits from loans to governments, especially for wars; how this led to preventing any one nation from becoming strong enough to establish peace (the famous balance of power); how those who could instigate wars or revolutions were financed (including the Bolsheviks in 1917); how we Americans were sucked into World War I in order to save J.P. Morgan’s loans to England; how environmentalism is now the weapon of choice replacing war.

We are taken to the super-secret meeting of Insider financiers and Rothschild agent Paul Warburg on Jekyll Island in 1910 where the basic plan for what became the Federal Reserve Act was formulated; we learn that these plotters were already affiliated with the conspiratorial British one world Round Table group which preceded the Council on Foreign Relations (our secret government); we are astounded by the brazen deception of Congress that pushed through this unconstitutional act creating the Insiders’ fundamental tool — a central bank with the ability to inflate. We are told how this same tool has been expanded internationally through the International Monetary Fund (IMF) and World Bank in order to create worldwide inflation, pay enormous sums of perpetual interest on never paid-up loans to Insider banks, and socialize the Third World, all courtesy of us unsuspecting taxpayers. Lastly, Griffin foretells our dismaying fate if our course is not altered; then he lays out a step-by-step procedure of how to alter it, inviting us to join with him in doing so.

Griffin looks the Fed “creature” straight in the eye and tells us it is not federal, it has no reserves, and it is not a bank. It is, in fact, a pernicious cartel operating against the public interest. The widespread belief that the Federal Reserve exists to “stabilize the economy” is hogwash; the real reason for its existence is the making of money — not out of “thin air” as is commonly supposed, but, more accurately, out of debt. Griffin explains that it is the act of borrowing by the federal government that causes money to spring into existence.

Griffin takes us through the Open Market steps by which Treasury IOUs (bonds) are inverted by the Federal Reserve into money through the issuance of Federal Reserve checks with no money in existence to cover them; anyone else doing this would go to jail. Congress has made this legal for the Fed, however, because this hidden process allows our congressmen to enjoy unlimited revenue without having to visibly raise taxes. Without this service, says Griffin, the monetary/political partnership would dissolve, and Congress would abolish the Fed.

Money Multiplied

Griffin explains that these Federal Reserve checks are endorsed by the government, deposited in a Federal Reserve bank, and used to pay government expenses by checks which create the first wave of fiat (unbacked paper) money that floods into the economy. Recipients deposit these checks into commercial banks that are part of the Fed system. Here is where the real inflationary action is. (The Federal Reserve holds “only” seven percent of the national debt of almost $5 trillion. The 12 percent held by foreigners and the 56 percent held by Americans are not inflationary because the money used for purchase already existed.)

Commercial banks, like the Federal Reserve, also create money out of nothing — and collect interest on it — by multiplying every dollar deposited nine times. This amazing feat is accomplished through the device of fractional reserves, whereby the Fed allows 90 percent of deposits to be loaned out. As deposits become loans and loans become deposits, this process repeats with smaller numbers each time around. For instance, $1 million in government money (first wave) to $900,000 (second wave), which gives birth to $810,000 (third wave), etc., until the process plays itself out. Thus, the banking cartel creates an amount of money that is nine times the amount of the original government debt that made the process possible.

Griffin shows that when the original debt is added in, the Federal Reserve and the commercial banks together have created approximately ten times the amount of the underlying government debt. Since this newly created money causes the purchasing power of all money to decline, the resulting rise in prices is, in reality, a hidden tax. As Griffin puts it:

Without realizing it, Americans have paid over the years, in addition to their federal income taxes and excise taxes, a completely hidden tax equal to approximately ten times the national debt!

Griffin is astonished at the public’s indifference to this fleecing; he blames it on ignorance based on disinformation. Nothing could prove him more right than the current deception that inflation is higher prices caused by full employment and a strong economy; therefore, letting the "steam" out of the economy and slowing growth (and thereby employment) is “good.” This talk is madness. Alan Greenspan. chairman of the Federal Reserve (who has the temerity to say he is “worried about inflation”), is repeating this claptrap as he pretends to control inflation by increasing interest rates that merely devastated the bond market, clobbered the stock market, and helped only the bankers. Thus the Insiders are perfectly protected and the scam rolls on.

There are many more threads to Griffin’s discourse on the operations of the banking cartel that should not be missed, such as:

*How holders of Treasury bonds can be paid off only by the creation of an identical bond out of nothing.
*Why the U.S. has to be, must be, in debt.
*How the Discount Window (Fed loans to banks) creates more phony money.
*How the federal government could operate without levying any taxes whatsoever.
*How the Fed causes booms and busts.
*How, since 1913, our money has depreciated by over 1,000 percent.
*How a gold standard automatically stabilizes prices.
*How the Fed can now monetize the debts of foreign governments!
*Without the extensive knowledge offered by Griffin, no American can fully understand the financial reality of our time.

Understanding the Game

Also critical to our reality check is an understanding of how the Fed protects and enriches the banking brotherhood in the international arena. The game our Insiders are playing makes the Rothschilds look like novices. Here it is in a nutshell: The game starts with a mammoth loan (created out of nothing through the magic of fractional reserves) from (Citicorp, Chase Manhattan, Bank of America, etc.) to a Third World country with scant means of servicing the debt much less ever repaying the principle. Are these top bankers stupid? Hardly; Griffin explains that this is the kind of loan these bankers love, since they make their money from interest on the loan, not on repayment of the loan. They prefer the loan never to be repaid. They know they can’t lose because the Federal Reserve guarantees that massive loans that go into default will not be allowed to seriously affect the issuing bank (too big to fail) because this would “disrupt the entire economy."

So, says Griffin, "since the System makes it profitable for banks to make large, unsound loans, that is the kind of loans banks will make. Furthermore, it is predictable that most unsound loans will go into default." Sure enough; pretty soon default threatens. The bank creates additional money out of nothing and lends that so its interest stream continues on both the original loan plus the new loan (the “roll-over” play). At the next crisis, the bank creates still more money out of nothing to cover the interest on both loans plus an additional amount for the borrower to spend freely (the “up-the-ante” play). Finally the bank agrees to a lower interest rate and a longer period for repayment (the rescheduling" play). Eventually it is time for the “Final Maneuver.” Congress agrees to guarantee future payments and the whole mess is shifted to the backs of U.S. taxpayers while the borrower is trapped into an IMF “austerity” program that makes an “end run” around his sovereignty.

Now money moves through various foreign aid channels to the deadbeat borrower, who continues to pay perpetual interest to the bank. Almost all of this money is generated by the Federal Reserve; as it moves out into the economy it dilutes the value of the money already there. The American people, says Griffin, have no idea they are footing the bill to enrich the Insider bankers.

Founder’ Fears Realized

Readers may be surprised to learn that the Federal Reserve is the fourth central bank the United States has had, the previous three having crashed in inevitable raging inflation and widespread economic disaster. So clearly did our Founders understand and fear worthless paper money forced on the public by legal tender laws (precisely what we now have) that they filled the proceedings of the Constitutional Convention with statements of their horror of it. We Americans today, deprived of hearing such truth, need to listen to their words:

* George Mason of Virginia: “I have a mortal hatred of paper money.”
* John Langdon of New Hampshire: “I would rather reject the whole [Constitution] than grant the new government the right to issue fiat money."
* George Reed of Delaware: “The right to issue fiat money would be as alarming as the mark of the beast in Revelation."
* Thomas Paine: “The punishment of a member of Congress who should move for such a law ought to be death."

Griffin does not stop with presenting the known picture, but projects today's reality into the future. His first projection is a doomsday scenario his second is a realistic plan for saving our country and ourselves. These chapters might, after all, be the most important ones in the book.
Griffin sees doomsday as an engineered financial debacle the severity of which will cause panicked Americans to welcome — a World Bank "rescue" with a world currency. The IMF/World Bank is already functioning — in conjunction with the Federal Reserve — as a world central bank. A world currency is already designed, awaiting a crisis to justify its introduction. From this point on, writes Griffin, there will be no escape from the new world order. At present the U.S. is being deliberately weakened by seemingly insane spending both at home and abroad: As just one more dismaying example, during President Clinton's recent trip to Europe he blithely promised more billions of dollars to Poland, Ukraine, and the Baltic countries. The name of the game is to spend on anything, anywhere. The object is to bring down the system.

Life in the New World Order

What will life be like in the Insiders' new world order? Griffin spells it out from the words of the Insiders themselves. One source is the 1966 secret Hudson Institute study commissioned by Defense Secretary Robert McNamara, entitled Report from Iron Mountain. This study cold-bloodedly discusses various means by which government might control the populace and perpetuate itself in power in the absence of war (UN peace).

Griffin's review (with extensive quotes) of this truly diabolical Insider study is masterful; he takes it apart and shows us its consummate evil. The study's premise is that historically the only means by which a government has ever been able to "secure the subordination of citizens to the state" is war. Only war has been able to provide the external threat without which no government can accumulate power. War is used to make the masses put up with all kinds of privation, taxation, and controls without complaint. No amount of sacrifice in the name of victory is rejected. Resistance is viewed as treason.
But, says Griffin, Report From Iron Mountain explains that the war system may have to be replaced because "it may now be possible to create a world government in which all nations will be disarmed and disciplined by a world army, a condition which we will call peace. "In this case, what could be a substitute for war?

Here, explains Griffin, is the origin of the stratagem to promote ecological doom as the new enemy that threatens the entire world. The threat need not be real, provided the masses can be convinced it is real. Credibility is the key, not reality. Griffin writes that Report From Iron Mountain explains the avalanche of phony scientific claims that are uncritically publicized by the Insider-controlled media, as well as the funding of environmental "crazies" by corporations and businesses that would appear to have the most to lose. He sees the plan as being brilliantly successful.

The barrage of propaganda has had a phenomenal result. Politicians are now being elected on nothing but "concern for the environment and a promise to clamp down on nasty industries," with no one caring about the damage done to the economy or our freedoms. Just as no sacrifice is too great in time of war, what happens to the economy or our freedom is of no consequence "when the very planet on which we live is sick and dying."

Griffin introduces us to multi-millionaire Maurice Strong, the powerful UN environmental czar, who gives us the whole line: The U.S. is committing environmental aggression against the rest of the world. Current lifestyles of the affluent middle class — high meat intake, frozen and convenience foods, electric household appliances, cars, air conditioning, suburban housing — all this has to go. The world’s ecosystems can be preserved only by lowering our standard of living by rationing, taxation, and political domination by world government.

Reading this section will forever change the way in which you view government. Yet, says Griffin, this perverted, power-mad Insider fix need not prevail. None of these dreadful things needs to happen. He outlines a procedure by which the Federal Reserve can be abolished, the national debt paid, and the country returned to a sound monetary system based on silver and gold. All that is needed are the efforts of concerned and caring Americans. Griffin invites us to join him in freeing ourselves from the one-world conspirators. It can be done.



"A superb analysis deserving serious attention by all Americans. Be prepared for one heck of a journey through time and mind."

Ron Paul
Publisher/Editor, Ron Paul Report
Member, House Banking Committee

"What every American needs to know about central bank power. A gripping adventure into the secret world of the international banking cartel."

Mark Thornton
Asst. Professor of Economics, Auburn Univ.
Coordinator Academic Affairs,
Ludwig von Mises Institute

"A magnificent accomplishment — a train load of heavy history, organized so well and written in such a relaxed and easy style that it captivated me. I hated to put it down."

Dan Smoot
Publisher/Editor, Dan Smoot Report


Comments from some of our readers:

"...I have just finished reading your book, The Creature from Jekyll Island. Without a doubt, your book has to be the absolute best book that I have ever read. I have read books about money, banking and of the Federal Reserve, such as The Ron Paul Money Book by Ron Paul; The Case Against the Fed by Murray N. Rothbard; Age of Inflation by Hans F. Sennholz, as well as other books on the "Free Enterprise system". As good as these books are, none of them can compare to your book.
....I have classified your book as a "must read" for anyone interested in learning about the monetary system." -- H.B., Ontario, Canada.

"...Thank you for your time and efforts authoring (this book).... I learned more about economics from your single book than I did pursuing a BBA at a state college. Fractional reserve banking and fiat money were mentioned, but their history and effects upon our economy were not. A majority of the time was devoted to the derivation of economic formulas, (educated the masses to be productive, not thinkers)." -- L.C., Poynette, Wisconsin.

"...I have just finished reading your marvellous book, and must declare that the information you presented has cleared more sleep from my eyes than any other printed information, with exception to the Holy Bible. And I recognize that the Holy Spirit of GOD is with you in your investigative journey."  -- D.C., Charlotte, North Carolina.