Posted 2/11/03 The Creature from Jekyll Island: A Lecture on the Federal Reserve “G. Edward Griffin exposes the most blatant scam of all history. It’s all here: the cause of wars, boom-bust cycles, inflation, depression, prosperity. It’s just exactly what every American needs to know about the power of the central bank.” source:http://www.theantechamber.net/UsHistDoc/CreatureJekyllIsland.html
(Law, Banking and Business. Copyright, 1918, by THE JOHN A. HERTEL CO., Copyright 1921 by THE JOHN A . HERTAL CO.)
Growth of Foreign Commerce.– Even prior to the World War, American commerce had been pushing its way into the four corners of the globe. It was true that it had been carried almost entirely in foreign ships, but the thing that seemed to satisfy us for the moment, was the fact that it went, and the manner of its gong was something of lesser importance.
This growth in our foreign commerce has kept pace with our own growth in manufactured products which we have been turning out in quantities in excess of our own demands, and our manufacturers have been forced to look to a foreign market.
War Expansion.— In the early months of the war, the United States was the one great neutral manufacturing nation as well as the world’s granary, inasmuch as the merchant ships of the warring nations were practically swept off the seas. The United States manufacturers and exporters of all kinds rushed into the vacuum thus caused by the war and American goods were in greater demand than ever, not only by the warring nations, but by the neutral nations cut off from other foreign sources of supply.
Even during our participation in the war the amount of exports piled up to unheard of aggregates, so that the balance of trade was strongly in our favor and the United States became the creditor nation of the world.
Foreign Banking Facilities.— As our foreign commerce grew, the nation began to realize its handicap in the matter of foreign banking facilities. Foreign nations have their own methods of transacting business, their own and customary terms of credit and payments, and our competitors in the foreign field had been long used to doing business with these nations in their own way.
The South American trade, for example, has been used to buying on long credits, from six to twelve months, and France, England and Germany as well as the other nations of Europe have been taking the lion’s share of this trade on these terms.
To facilitate the handling and financing of the great volume of such foreign business, these countries extended their banking facilities to these foreign fields, and with the result that our own exporters were at a decided disadvantage, losing their competitors the trade that was not in a position or willing to make payment in New York against bills of lading.
(note no. 1. These Bills of Lading is in regards to the Peruvian Manuevo Guano-Nitrate “Bonds” which W.R. GRACE, J.P. MORGAN, the English Rothschild Banking “Tripod” bankrupted the Latin American Nations, Peru included through “SHORT BILLING Bills of Lading” which they, in turn, foreclosed on Peru obtaining a 60 year receivership on the Natural Resources of Peru, her Rail Roads etc. W.R. Grace alleged to have “purchased all the outstanding bonds of Peru.” He missed the ONE TIME ONLY BONUS “3392-181” owned by the DURHAM (INTL. LTD;) HOLDING TRUST (TIAS 12087) whereas said Debt of Peru was “assumed” through the U.S. Dept. of Agriculture, U.S. Dept. of State through the 1856 GUANO ACT; Resolved by the U.S. House of Representatives & U.S. Senate 1905-06.)
(note no. 2.) This is the main thrust of Ben Bernanke’s toasting of Milton Friedman, Governor of the Board of Governor’s of the Federal Reserve Bank, “90th Birthday toast” “Sure, We caused the great depression”…which was published on or about December 9th, 2002 Business news.)
Expanding the Federal Reserve Act.— Our own banking system having been so successfully reconstructed and expanded through the Federal Reserve Act, creating the Federal Reserve Banks and enlarging their financial stress, having proven so beneficial, Congress, in 1919 amended the act authorizing the creation of banks within the United States to do foreign banking business, by what is known as the Edge, or Foreign Banking Act, approved December 24, 1919.
Provisions of the Act.— The Act amends the Federal Reserve Act by adding a new section (25), and owing to its importance, is given in full as follows:
“Banking corporations authorized to do foreign banking business.
“Sec. 25. (a) Corporations to be organized for the purpose of engaging in international or foreign banking or other international or foreign financial operations, or in banking or other financial operations in a dependency or insular possession of the United States, either directly or through the agency, ownership or control of local institutions in foreign countries, or in such dependencies or insular possessions as provided by this section,and to act when required by the secretary of the treasury as fiscal agents of the United States, may be formed by any number of natural persons, not less in any case than five.
“Such persons shall enter into articles of association which shall specify in general terms the objects for which the association is formed and may contain any other provisions not inconsistent with law which the association may see fit to adopt for the regulation of its business and the conduct of its affairs.
Organization Certificate.— “Such articles of association shall be signed by all of the persons intending to participate in the organization of the corporation and, thereafter, shall be forwarded to the federal reserve board and shall be filed and preserved in its office. The persons signing the said articles of association shall, under their hands, make an organization certificate which shall specifically state:
“1. The name assumed by such corporation, which shall be the subject of the approval of the federal reserve board.
“2. The place or places where its operations are to be carried on.
“3. The place in the United States where its home office is to be located.
“4. The amount of its capital stock and the number of shares into which the same shall be divided.
“5. The names and places of business or residence of the persons executing the certificate and number of shares to which each has subscribed.
“6. The fact that the certificate is made to enable the persons subscribing the same, and all other persons, firms, companies and corporations who or which may thereafter subscribe to or purchase shares of the capital stock of such corporation, to avail themselves of the advantages of this section.
Completing the Organization.— “The persons signing the organization certificate shall duly acknowledge the execution thereof before a judge of some court of record or notary public, who shall certify thereto under the seal of such court or notary, and thereafter the certificate shall be forwarded to the federal reserve board to be filed and preserved in its office. Upon duly making and filing articles of association and an organization certificate, and after the federal reserve board has approved the same and issued a permit to begin business, the association shall become a body corporate and as such and in the name designated therein shall have power to adopt and use a corporate seal which may be changed at the pleasure of its board of directors; to have succession for a period of twenty years unless sooner dissolved by the act of the shareholders owning two-thirds of the stock, or by an act of congress or unless its franchises become forfeited by some violation of law; to make contracts; to sue and be sued, complain or defend in any court of law or equity; to elect or appoint directors, all of whom shall be citizens of the United States; and, by its board of directors, to appoint such officers and employees as may be deemed proper, define their authority and duties, require bonds of them, and fix the penalty there of, dismiss such officers or employees, or any thereof, at pleasure and appoint others to fill their places; to prescribe, by its board of directors, bylaws not inconsistent with law or with the regulations of the federal reserve board regulating the manner in which its stock shall be transferred, its directors elected or appointed, its officers and employees appointed, its property transferred, and the privileges granted to it by law exercised and enjoyed.
Scope of Operations.— “Each corporation so organized shall have power, under such rules and regulations as the federal reserve board may prescribe:
“(a) To purchase, sell, discount and negotiate, with or without its indorsement or guaranty, notes, drafts, checks, bills of exchange, acceptances, including bankers’ acceptances, cable transfers and other evidences of indebtedness; to purchase and sell, with or without its indorsement or guaranty, securities, including the obligations of the United States or of any state thereof but not including shares of stock in any corporation except as herein provided; to accept bills or drafts drawn upon it subject to such limitations and restrictions as the federal reserve board may impose; to issue letters of credit; to purchase and sell coin, bullion and exchange; to borrow and to lend money; to issue debentures, bonds and promissory notes under such general conditions as to security and such limitations as the federal reserve board may prescribe, but in no event having liabilities outstanding thereon at any one time exceeding ten times its capital stock and surplus; to receive deposits outside of the United States and to receive only such deposits within the United States as may be incidental to or for the purpose of carrying out transactions in foreign countries or dependencies or insular possessions of the United States; and generally to exercise such powers are incidental to the powers conferred by this act or as may be usual, in the determination of the federal reserve board, in connection with the transaction of the business of banking or other financial operations in the countries, colonies, dependencies or possessions in which it shall transact business not inconsistent with the powers specifically granted herein.
Nothing contained in this section shall be construed to prohibit the federal reserve board, under its power to prescribe rules and regulations, from limiting the aggregate amount of liabilities or any or all classes incurred by the corporation and outstanding at any one time. Whenever a corporation organized under this section receives deposits in the United States authorized by this section it shall carry reserves in such amounts as the federal reserve board may prescribe, but in no event less than 10 per centum of its deposits.
Branches.— “(b) To establish and maintain for the transaction of its business branches or agencies in foreign countries, their dependencies or colonies, and in the dependencies or insular possessions of the United States, at such places as may be approved by the federal reserve board and under such rules and regulations as it may prescribe, including countries or dependencies not specified in the original organization certificate.
Holding Other Stocks.— “(c) With the consent of the federal reserve board to purchase and hold stock or other certificates of ownership in any other corporation organized under the provisions of this section, or under the laws of any foreign country or a colony or dependency, or insular possession of the United States but not engaged in the general business of buying or selling goods, wares, merchandise or commodities in the United States, and not transacting any business in the United States except such as in the judgment of the federal reserve board may be incidental to its international or foreign business: Provided, however, That, except with the approval of the federal reserve board, no corporation organized hereunder shall invest in any one corporation an amount in excess of 10 per centum of its own capital and surplus, except in a corporation engaged in the business of banking, when 15 per centum of its capital and surplus may be so invested:
Provided, further, That no corporation organized hereunder shall purchase, own, or hold stock or certificates of ownership in any other corporation organized hereunder or under the laws of any state which is substantial competition therewith, or which holds stock or certificates of ownership in corporations which are in substantial competition with the purchasing corporation.
Stock Held for Debt.— “Nothing contained herein shall prevent corporations organized hereunder form purchasing and holding stock in any corporation where such purchase shall be necessary to prevent a loss upon a debt previously contracted in good faith; and stock so purchased or acquired in corporations organized under this section shall within six months from such purchase be sold or disposed of at public or private sale unless the time to so dispose of same is extended by the federal reserve board.
No Commercial Business.— (read this one very carefully) “No corporation organized under this section shall engage in commerce or trade in commodities (this includes gold) except as specifically provided in this section, nor shall it either directly or indirectly control or fix or attempt to fix the price of any such commodities.
The charter of any corporation violating this provision shall be subject to forfeiture in the manner hereinafter provided in this section. It shall be unlawful for any director, officer, agent or employee of any such corporation to use or to conspire to use the credit, the funds or the power of the corporation to fix or control the price of any such commodities, and any such person violating this provision shall be liable to a fine of not less than $`1,000 and not exceeding $5,000 or imprisonment of not less than one year and not exceeding five years, or both, in the discretion of the court.
Amount of Capital.— “No corporation shall be organized under the provisions of this section with a capital stock of less than $2,000,000, one quarter of which must be paid in before the corporation may be authorized to begin business, and the remainder of the capital stock of such corporation shall be paid in installments of at least 10 per centum on the whole amount to which the corporation shall be limited as frequently as one installment at the end of each succeeding two months from the time of the commencement of its business operations until the whole of the capital stock shall be paid in. The capital stock of any such corporation may be increasted at any time, with the approval of the federal reserve board, by a vote of two-thirds of its shareholders or by unanimous consent in writing of the shareholders without a meeting without a formal vote, but any such increase of the capital shall be fully paid within ninety days after such approval and may be reduced in like manner, provided that in no event shall it be less than $2,000,000.
No corporation except as herein proided, shall during the time it shall continue its operations withdraw or permit to be withdrawn, either in form of dividends or otherwise, any portion of its capital. Any national banking association may invest in the stock of any corporation organized under the provisions of this section, but the aggregate amount of stock held in all corporations engaged in business of the kind described in this section and in section 25 of the federal reserve act as amended shall not exceed 10 per centum of the subscribing bank’s capital and surplus.
Nationality of Stockholders.— “A majority of the shares of the capital stock of any such corporations shall at all times be held and owned by citizens of the United States, by corporations the controlling interest in which is owned by citizens of the United States, chartered under the laws of the United States or of a state of the United States, or by firms or companies the controlling interest in which is owned by citizens of the United States.
The provisions of section 8 of the act approved October 15, 1914, entitled ‘An act to supplement existing laws against unlawful restraints and monopolies, and for other purposes, as amended by the acts of May 15, 1916, and Sept. 7, 1916, shall be construed to apply to the directors, other officers, agents or employees of corporations organized under the provisions of this section: Provided,however, That nothing herein contained shall (1) prohibit any director or other officer, agent or employe of any member bank who has procured the approval of the federal reserve board from serving at the same time as a director or other officer, agent or employee of any corporation organized under the provision of this section in whose capital stock such member bank shall have invested; or (2) prohibit any director or other officer, agent or employee of any corporation organized under the provisions of this section who has procured the approval of the federal reserve board from serving at the same times as a director or other officer, agent or employe of any such other corporation in whose capital stock such first-mentioned corporation shall have invested under the provisions of this section.
Members Federal Reserve Board.— “No member of the federal reserve board shall be an officer or director of any corporation organized under the provisions of this section, or of any corporation engaged in similar business organized under the laws of any state, nor hold stock in any such corporation, and before entering upon his duties as a member of the federal reserve board he shall certify under oath to the secretary of the treasury that he has complied with this requirement.
Stockholders’ Liability.— “Shareholders in any corporation organized under the provisions of this section shall be liable for the amount of their unpaid stock subscriptions. No such corporation shall become a member of any federal reserve bank.
Forfeiture of Charter.— “Should any corporation organized hereunder violate or fail to comply with any of the provisions of this section all of its rights, privileges and franchises derived here from may thereby be forfeited.
Before any such corporation shall be declared dissolved, or its rights, privileges and franchises forfeited, any noncompliance with, or violation of such laws shall, however, be determined and adjudged by a court of the United States of competent jurisdiction, in a suit brought for that purpose in the district or territory in which the home office of such corporation is located, which suit shall be brought by the United States at the instance of the federal reserve board or the attorney-general.
Upon adjudication of such noncompliance or violation, each director and officer who participated in, or assented to, the illegal act or acts, shall be liable in his personal or individual capacity for all damages which the said corporation shall have sustained in consequence thereof. No dissolution shall take away or impair any remedy against the corporation, its stockholders or officers for any liability or penalty previously incurred.
Receivership in Insolvency.— “Whenever the federal reserve board shall become satisfied of the insolvency of any such corporation it may appoint a receiver who shall take possession of all the property and assets (This is why ALL MORTGAGES and U.S. TITLE INSTRUMENTS were removed from the United States Depository Trust Co.) December 2002, moved to ROTHSCHILD BANKING “LONDON HOUSE” then moved to the French Branch of Rothschild Banks in France last month of February 2003) of the corporation it may appoint a receiver who shall take possession of all of the property assets of the corporation and exercise the same rights, privileges, powers and authority with respect thereto as are now exercised by receivers of national banks appointed by the comptroller of the currency of the United States: Provided, however, That the assets of the corporation subject to the laws of other countries or jurisdictions shall be dealt with in accordance with the terms of such laws.
Annual Meetings; Reports.— “Every corporation organized under the provisions of this section shall hold a meeting of its stockholders annually upon a date fixed in its by-laws, such meeting to be held at its home office in the United States.
Every such corporation shall keep at its home office books containing the names of all stockholders thereof, and the names and addresses of the members of its board of directors, together with copies of all reports made by it to the federal reserve board.
Every such corporation shall make reports to the federal reserve board at such times and in such form as it may require; and shall be subject to examination once a year and at such other times as may be deemed necessary by the federal reserve board by examiners appointed by the federal reserve board, the cost of such examination, including the compensation of the examiners, to be fixed by the federal reserve board and to be paid by the corporation examined.
Dividends.— “The directors of any corporation organized under the provisions of this section may, semi annually, declare a dividend of so much of the net provits of the corporaion as they shall judge expedient; but each corporation shall, before the declaration of a dividend, carry one-tenth of its net profits of the preceding half year to its surplus fund until the same shall amount to 20 per centum of its capital stock.
Liability for Taxes.— “Any corporation organized under the provisions of this section shall be subject to tax by the state which its home office is located in the same manner and to the same extent as other corporations organized under laws of that state which are transacting as imiliar character of business. The shares of stock in such corporation shall also be subject to tax as the personal property of the owners or holders thereof in the same manner and to the same extent as the shares of stock in similar state corporations.
Extension of Charter.— “Any corporation organized under the provisions of this section may at any time within the two years next previous to he date of the expiration of its corporate existence, by a vote of the shareholders owning two thirds of its stock, apply to the federal reserve board for its approval to extend the period of its corporate existence for a term of not more than twenty years, and upon certified approval of the federal reserve board such corporation shall have its corporate existence for such extended period unless sooner dissolved by the act of the shareholders owning two thirds of its stock, or by an act of congress or unless its franchise becomes forfeited by some violation of law. (note no. 3. “Original U.S. Immigration Law. “No person, individual (company) shall own property in the United States without having first taken the Oath, and having become a Citizen of the United States.”)
(note no. 4. “Foreign, Predatory Banks, indulging in Predatory Banking Practices” are, and have operated within the United States, under the federal reserve bank’s “authorization”, stealing homes, lands, water-rights and other “property” of the Citizens of the United States, while “in violation of this Act known as The Foreign Banking Act by Act of Congress, in violation of the Organic Law of the United States i.e., The U.S. Constitution’s Bill of Rights?).
Existing Banks May Come Under Act.— “Any bank or banking institution, principally engaged in foreign business, incorporated by special law of any state or of the United States or organized under the general laws of any state or of the United States and having an unimpaired capital sufficient to entitle it to become a corporation under the provisions of this section may, by the vote of the shareholders owning not less than two-thirds of the capital stock of such bank or banking association, with the approval of the federal reserve board, be converted into a federal corporation of the kind authorized by this section with any name approved by the federal reserve board: Provided, however, that said conversion shall not be in the contravention of the state law. In such case the articles of association and organization certificate may be executed by a majority of the directors of the bank or banking association, and the certificate shall declare that the owners of at least two-thirds of the capital stock have authorized the directors to make such certificate and to change or convert the bank or banking association into a federal corporation.(note no. 5. State Civil Codes of most states historically, “Prohibited foreign Banks from coming into the states. Equally, prohibiting Foreign Utility Companies from crossing state lines. The federal reserve “violated the Civil Laws of the States” by “abuse of federal power as contained in this Foreign Banking Act”) A majority of the directors, after executing the articles of association and the organization of certificate, shall have power to execute all other papers and to do whatever may be required to make its organization perfect and complete as a federal corporation. The shares of any such corporation may continue to be for the same amount of each as they were before the conversion, and the directors may continue to be directors of the corporation until others are elected or appointed in accordance with the provisions of this section.
When the federal reserve board has given to such corporation a certificate that the provisions of this section have been complied with, such corporation and all its stockholders, officers and employees shall have the same powers and privileges, and shall be subject to the same duties, liabilities and regulations, in all respects, as shall have been prescribed by this section for corporations originally organized hereunder.
Penalties.— “Every officer, director, clerk, employe or agent of any corporation organized under this section who embezzles, abstracts, or willfully misapplies any of the moneys, funds, credits, securities, evidences of indebtedness, or assets of any character of such corporation; or who, without authority from directors, issues or puts forth any certificate of deposit, draws any orderor bill of exchange, makes any acceptance, assigns any note, bond, debenture, draft, bill of exchange, mortgage, judgment or decree; or who makes any false entry in any book, report or statement of such corporation with intent in either case to injure or defraud such corporation or any other company, body politic or corporate, or any individual person, or to deceive any officer of such corporation, the federal reserve board or any agent or examiner appointed to examine the affairs of any such corporation; and ever receiver of any such corporation and every clerk or employe of such receiver who shall embezzle, abstract or wilfully misapply or wrongfully convert to his own use any moneys, funds, credits, or assets of any character which may come into his possession or under his control in the execution of his trust or the performance of the duties of his employment; and every such receiver or clerk or employe of such receiver who shall, with intent to injure or defraud any person, body politic or corporate, or to misled the federal reserve board, or any agent or examiner appointed to examine the affairs of such receiver, shall make any false entry in any book, report or record of any matter connected with the duties of such receiver; and every person who with like intent aids or abets any officer, director, clerk, employe or agent of any corporation organized under this section, or receiver or clerk or employe of such receiver as aforesaid in any violation of this section, shall upon conviction thereof be imprisoned for not less than two years nor more than ten years, and may also be fined not more than $5,000 in the discretion of the court.
“Who ever being connected in any capacity with any corporation organized under this section represents in any way that the United States is liable for the payment of any bond or other obligation, or the interest thereon, issued or incurred by any corporation organized hereunder, or that the United States incurs any liability in respect of any act or omission of the corporation, shall be punished by a fine of not more than $10,000 and by imprisonment for not more than five years.”