THE FRAMEWORK OF THE MONSTER
HERE'S the idea. Were you one of a coterie of multi-millionaires
lusting for the control of American industry and finance--exclusively
for pillage--you would, if necessary, join in providing any amount of
capital necessary to obtain the result. You could afford to provide
it for it would make you one of a coterie enabled to loot the richest
prizes on this planet. Any system which could at will open or shut
the valves of American credit, stage an orgy of "inflation" or stage
a debacle of "deflation," increase or decrease the money supply, make
the tide of employment flow to prosperity's height or ebb to despair's
depths, create a "bull" or a "bear" market at will--would justify the
investment of hundreds of millions or even billions of capital! Its
power would be practically boundless, its profits be fabulous and from
its coign of vantage it could coin the sweat of scores of millions of
toilers into its coffers of greed.
But if you could do this very same thing and obtain precisely the same
results and reap exactly the same harvest in power and pelf without
investing one thin dime or one plugged nickel you wouldn't put up the
money, would you? That is just exactly what these Federal Reserve
highbinders did and this is just exactly how they did it. There lay
fair to their hands the most successful banking system in the world's
annals--the National Banks.
Here was the core and center of their pillage. Here was the capital
ready to their hands. They proceeded to levy upon, to appropriate and
to commandeer their capital from the National Banks of the United
States. They divided the U.S.A. into twelve financial satrapies or
dependencies or loot areas with centers of pillage thusly: New York,
Chicago, Atlanta, San Francisco, Boston, Minneapolis, Kansas City,
St. Louis, Cleveland, Philadelphia, Richmond, and Dallas. Upon every
National Bank in the U.S.A. there was levied a capital tribute of six
per cent of their capital and surplus account for subscribed capital
to the Federal Reserve Bank set over them. Of this amount one-half or
three per cent was required to be immediately paid in and the other
half was held subject to call if required.
Take a look at this first step on the stairway of pillage. Without the
investment of one copper cent, of one plugged nickel or of one thin
dime and by one stroke of the pen when this infamous law was passed
practically one hundred millions of capital was commandeered into the
coffers of Federal Reserve banditry. Without the risk of one penny of
their own money the Federal Reserve plunderbund seized in its talons
of greed the hugest banking capital in the U.S.A.--practically two
hundred millions of dollars with one-half of it immediately payable
and the other half subject to call! It was the most daring financial
high-bindery ever enacted on earth.
Right here don't hock your brains--do your own thinking. Without any
option, without any vote of stockholders, without any action by its
officers every National Bank in the U.S.A. was compelled to buy stock
in the Federal Reserve Bank in its fiscal dependency or loot area in
which it was located. Protest was useless--just as useless as if they
stood under the guns of a Jesse James' or Younger Brothers' gang. It
was just "stand and deliver" and they delivered!
At this time, in 1914, the banking business in the U.S.A., and
particularly National Banks, was functioning soundly and safely. It
was serving--not dominating--industry. It was making reasonable--not
Shylock--profits.
Suppose the lustful eyes of the Federal Reserve lootage had turned
to the drygoods instead of to the banking business. They would have
compelled every drygoods merchant in the U.S.A. to contribute six per
cent of his capital and surplus--with one-half immediately payable--to
set up a drygoods jobbing house in the center of a designated loot
area. They would have compelled every drygoods merchant to purchase
his merchandise from that jobbing house at their price. Isn't one
proposition as sane as the other? Of course it is. But there is
this difference. By commandeering capital for the drygoods business
licensed looters _could control only the drygoods business_. But
by commandeering capital for the banking business licensed looters
_could control all business_! That's the difference and that's all the
difference. They commandeered capital where it could _control not one
industry but all industries_. They didn't commandeer a leg or an arm
of industry but they did commandeer _the life blood of all industry_
and at one leap vaulted into a seat of power where their scepter's sway
really governed all American industry. That's what they really did.
What price did Federal Reserve lootage pay for this commandeered
capital? It limited the dividends to be paid to these sandbagged
stockholders to six per cent per annum. No matter how fabulous might
be--and really have been--the profits of Federal Reserve pillage the
people who provided its life blood of capital must be content with a
paltry six per cent dividend! Over a long term of years the net profits
of the National Banks of the U.S.A. have averaged slightly over 12 per
cent per annum. But Federal Reserve lootage says: "We will pay you but
one half what your capital has been earning." Some gall? It was the
absolute acme of refrigerated nerve! No matter what Federal Reserve
Shylockery might make on this commandeered capital the people who
provided it--whose money it really was--could get but a paltry six per
cent.
But one fact or series of facts is worth more than pages of language.
So right here and now look at the actual results for the year 1920.
Here is a list of Federal Reserve profits and pillage for that year:
Per cent Net Sandbaggery
Location[1] Capital on Capital Per Cent
New York $24,618,000 217 211
Chicago 13,213,000 195 189
Atlanta 3,759,000 162 156
San Francisco 6,412,000 159 153
Boston 7,454,000 137 131
Minneapolis 3,265,000 131 125
Kansas City 4,295,000 129 123
St. Louis 4,229,000 124 118
Cleveland 10,070,000 119 113
Philadelphia 8,278,000 116 110
Richmond 4,884,000 110 104
Dallas 3,757,000 89 83
Take all of your reading, take all of the history of banking or of
finance since banks were first founded and see if you can approximate
any such leviathan Shylockery. The stockholders in National Banks who
provided the capital for this orgy of profiteering were gyped out of
all the way from 211 per cent in the New York satrapy to 83 per cent
in the Dallas satrapy. For the year 1920 all over the U.S.A. on the
average Federal Reserve lootage took away from the real providers of
its capital--the stockholders in National Banks--better than 154 per
cent on the money they provided!
These records are taken from the accounts of its own pillage rendered
by the Federal Reserve System itself.
You could be quite some banker yourself, you could orate and strut
and preen and propagandize, you could swell out your pouter pigeon
breast at stage-managed banquets and be a prince of high finance with a
limitless expense account and with an altitudinous salary--if you could
commandeer your neighbor's money at 6 per cent and then sandbag out
from 211 to 83 per cent profit on it, couldn't you?
Legal? Of course it's quasi-legal and that's the infamy of it. A
coterie of the most astute lobbyists who ever enchained a people's
industry log-rolled through a piece of legislation whereby they
commandeered for their capital the people's money at a petty 6 per
cent and in the year 1920 alone pouched on it a profit varying from 211
to 83 per cent! That's the record and those are the facts--hidden and
concealed from you and draped in a mantle of silence. Federal Reserve
lootage, Federal Reserve propaganda, Federal Reserve publicity--all
paid for from your money--is too astute to "toot" anent this legalized
sandbaggery. Do you, the stockholders in the eight thousand and odd
National Banks in the U.S.A., know of any reason why you should provide
at 6 per cent the capital for Federal Reserve lootage on which it made
in one year alone from 217 to 89 per cent? That is, do you know of
any reason except your legal helplessness and the bottomless greed of
Federal Reserve sandbaggery? If the law--cleverly lobbied through your
Congress--didn't compel you to do it, would you do it? Would you of
your own free will provide capital at 6 per cent and be gypped out of
154 per cent? You know you wouldn't! Here is the core and center and
solar plexus of the whole Federal Reserve System--commandeer capital at
a petty six per cent and realize out of it profits that make Shylock
look like a philanthropist. Peg this in your brainery and look further.
FOOTNOTES:
[Footnote 1: The average paid in capital for 1920 was $94,234,000 and
total net earnings were $151,408,031. This is 160.7% profit and so
stated on pages 153 and 154 of Federal Reserve Bulletin of February,
1921. When the net average of the individual banks are footed and
averaged the average is 140.9%. This discrepancy is for Federal
Reservists--not us--to explain.]