Federal Reserve History

April 2, 2008

Elaine Meinel Supkis

The onrush of news is taking a small break here. So it is time to look backwards rather than forwards. The Federal Reserves consortium of private owners are involved in a massive coup. The 200 pages they submitted to a befuddled Congress is a take over of our entire financial systems. It takes quite a few days to write up an elaborate proposal. Note that these people came prepared! Most Americans know virtually nothing about the history of banking and the government. Yet, if we look at old, musty newspapers pre-Federal Reserve, we can clearly see the debates over the value of money, type of money and handling of money was at the top of all political debates and attracted huge crowds. Now, people can't understand even a small part of this business. This is deliberate. The last thing the people who foisted the Fed on us want, is a debate. As Ron Paul is very aware.

A reader kindly sent me this link. I get many emails a day and many of them have great information. I want to thank everyone for this. The link below is about a real Supreme Court case. The financial systems we have today are the result of many laws and court ruling stretching back to the very foundation of the United States. Things are not 'set in stone' unless the Supreme Court sets it in cement.

Court Rules Federal Reserve is Privately Owned

Lewis v. United States, 680 F.2d 1239 (1982)

1. United States

There are no sharp criteria for determining whether an entity is a federal agency within meaning of the Federal Tort Claims Act, but critical factor is existence of federal government control over "detailed physical performance" and "day to day operation" of an entity. . . .

2. United States

Federal reserve banks are not federal instrumentalities for purposes of a Federal Tort Claims Act, but are independent, privately owned and locally controlled corporations in light of fact that direct supervision and control of each bank is exercised by board of directors, federal reserve banks, though heavily regulated, are locally controlled by their member banks, banks are listed neither as "wholly owned" government corporations nor as "mixed ownership" corporations; federal reserve banks receive no appropriated funds from Congress and the banks are empowered to sue and be sued in their own names. . .

3. United States

Under the Federal Tort Claims Act, federal liability is narrowly based on traditional agency principles and does not necessarily lie when a tortfeasor simply works for an entity, like the Reserve Bank, which performs important activities for the government. . . .

4. Taxation

The Reserve Banks are deemed to be federal instrumentalities for purposes of immunity from state taxation.

5. States Taxation

Tests for determining whether an entity is federal instrumentality for purposes of protection from state or local action or taxation, is very broad: whether entity performs important governmental function..

The conspirators who created the Federal Reserve chose the name as a disguise. The very name, 'Federal Reserve' is a Trojan Horse. Within this seemingly public central bank is actually a bunch of armed soldiers who aren't even bankers! There are some bankers involved in this raiding party. But the Trojan Horse also holds speculators, investors an old royals we thought we got rid of long ago! The identities of these raiders is kept as secret as possible. This isn't the seemingly small number of regional Federal Reserve banks, either. They are part of the front, they are the legs, head and body of the Trojan Horse designed and built by people like Vanderbilt and JP Morgan back at Jekyll Island 100 years ago.

There was virtually no debate in Congress and CERTAINLY none nationally or in the media before the Federal Reserve wheeled its Trojan Horse into Congress and then the White House. Any Cassandras who caught sight of this big machine being wheeled in were ignored.

November 19, 1907

EAGER TO TAKE FEDERAL NOTES;

President Receives Indorsement of Plan for $150,000,000 Currency Relief. $25,000,000 FOR NEW YORK Of the New Three Per Cents, Which May Be Used as Security for New Circulation.

PERHAPS AS RESERVE, TOO

News of the New Issues Employed Successfully in Buffalo to Check a Bank Run.

Immediate and approving response has been received from all over the country to the action of the President and Secretary Cortelyou in announcing the sale of $50,000,000 of Panama Canal bonds and the issue of $100,000,000 of treasury notes as a means of restoring public confidence and putting an end to the money stringency

This article from 1907 shows us clearly that the exact...yes...the VERY SAME measures used back then, exactly 100 years ago, are the ones used today...BY THE FED, not the government, to save the speculators on Wall Street! This amazing repeat of history shows us, we went in this big circle. Only it wasn't a circle, it was a spiral, downwards. Because the government, this time around, isn't solvent and has no way of getting out of debt or even living within its own means. Note how the government issued bonds and then sold these to the bankers in order to get the bond market going again. Note that the Federal Government was willing to accept whatever papers the bankers held as security for these sales! And these would all be 'short term bonds' that could be rolled over by the government.

Now, it is rolled over by the Federal Reserve who gets to pick and choose when and how to do this...WITHOUT DEBATE. And this is the key phrase here. We may debate with Bernanke but he doesn't have to LISTEN to us! He can choose to do things IN THE MIDDLE OF THE NIGHT. As we see over and over again. He pops out of bed like some sort of vampire and goes to work when the rest of us are asleep. We may like or hate what he cooks up at 3 am but we certainly have no feed-back mechanism. We just have to live with it. And of course, 99.9% of his midnight rescues are aimed at saving the very rich, not the very poor or anyone below billionaire status. They are the ones who call him at 3 am screaming to be saved. We can call him and his phone is either busy or we get a message, 'Sorry, we cannot process this call. The Federal Reserve isn't owned by you. Only owners may call this number.'

The Jekyll Island conspirators put forwards their central banking plan that would create a bank that was NOT a central bank but would be a Trojan Horse that would take control of the currency out of the hands of the Treasury and park it inside a system that had few political controls by popular politicians who were not bankers. They disguised this new law by calling it a 'Currency reform bill' rather than 'Creating a new banking system the government can't control bill'. This was made even more opaque by calling it the Owen/Glass Act. The Democrats fought hard to make this bill all about making a central bank under Federal control. But the bankers were furious about all this.

August 1, 1913
ADVISORY BOARD OF BANKERS

Democrats Again Alter Reserve Plan -- Eagle Assails Bill.

Chairman Glass wanted the bankers to be ADVISORY only. And he maintained that the Federal Reserve was to be POLITICAL. Meaning, Congress and the President would be the ultimate source of power, not the bankers. They can only give their opinions. Not unilaterally dictate things. This, of course, infuriated the banking community. They could see all their schemes going down the drain! It was summer, yet the difficulties of pushing their Trojan Horse through the doors of Congress was diminishing rapidly as more and more non-bankers [ie: farmers and manufacturers] got the ear of their representatives.

October 10, 1913
BANKERS' VIEWS IN SENATE

A general discussion of the currency situation on the floor of the Senate this afternoon made it plain that there was no considerable sentiment in that body for bringing pressure to bear on the Banking and Currency Committee to induce a early report

Now we are in October of 1913. The bankers have been using all their tools to get a grip on things. The Democrats were dragging their feet. The Trojan Horse was stuck in the doors of the Senate! The bankers were inside, sweating with fear and anger. How can they shove this thing through? Up until this point in time, the debate over currency was mostly between the gold fanatics and the silver nuts. In other words, Eastern bankers and Western farmers and miners. As I will show in a following article today, the gold/silver debate roared along for 100 years rising to a crescendo right before this bill was submitted to Congress.

There was a great desire for 'bipartisanship' in passing this bill which totally took the debate about currency types and values out of the hands of the public and shuffled it away inside of the banking vaults of the top investing bankers. The Republicans didn't want all the blame for this bill on their shoulders. They were desperate to get the Democrats to be party to this raid on the Treasury's powers.

Here is a second article from the same paper, the same day:

The merchants were worried about a repeat of the Civil War paper money fiasco. They worried that banking missteps would translate into sudden taxes. They also worried about...get this...INFLATION. The support for this bill was rising only because of changes introduced to prevent these things from happening.

Note how this bill was referred to as a 'currency bill.' Not a debate about a central banking system. The fact of the matter is, the writing on the paper currency issued by the Treasury was to be altered. As I pointed out in a previous article where I examined paper money in the past, 'History of Silver/Gold Ratios' I posted pictures of paper money we own that goes back to the Civil War. These things were contracts, not 'money'. The earliest ones listed all the laws relevant to the issuing of these government bonds. The first ones had a lot of script explaining how this was not 'money' but a paper representation of gold or silver coins. All the way up until the passage of the Owen/Glass Act, the paper currencies carefully noted if they were backed by either gold or silver. This was the Great Compromise previous to the Owen/Glass bill. The bankers wanted only gold-backed paper and the Western interests wanted silver backed. So the Treasury printed bonds that were contracted against either metal. Then people could choose which to use. In general, few people looked to see which were being used.

November 11, 1913,

WALL ST. DEFENDED TO OWEN AND GLASS

Bankers and Sponsors Debate the Currency Bill at Economic Club Dinner. F.A. VANDERLIP ATTACKS IT Says Legislation Can Wait and Urges President Not to Put Party Triumph Above Country's Needs.

This is an interesting article to read since it is the debate within the ruling elites, discussing how they should design this new system and the problem of the temptations of fiat currencies! It is now almost Thanksgiving. 11/11/1913 also happens to be a magic number day of great significance to the various secret societies. Bush Sr. made his infamous 'New World Order' speech on 9/11/1991, for example. So the fact that the people who belong to several interlocking societies and organizations chose this day for the debate is quite significant to me. They were performing the actions which we call 'magic'. Using numbers, the calendar, the position of the stars, etc, they basically 'chanted' for that which they wanted. This is 'dream making' of very ancient sort. By lining up codes and lining up systems so they fit into a magical framework, the hope is that reality will conform to desires. This is the basis of wizardry.

Flying under the radar of Christian or Jewish faith is this alternative, magical belief system. It does pop out into the open once and a while. But mostly, it is very subterranean. The system, by the way, has been breaking down in the last 50 years. But it still endures. And has been taken over partially by Osama Bin Laden. He is evidently aware of the magic number system.

Whenever I veer off into this area, some people are puzzled. They wonder why I am so intent on this. It is simple: my own ancestors helped design and create this system. And we are very involved in the place where all this comes together, the place we call 'The Outer Darkness.' Since this is also where the Dragon of Wealth lives, anyone seeking wealth has to approach it. Note how many rich people in America and elsewhere today get very rich building a doomsday machine which can turn our planet into a dead rock? This is something that amuses the Dragon greatly. The creation of the Federal Reserve was very much a part of this system set into motion to kill all humans. When rich men and women pray to the Dragon for wealth, they are actually praying to the Death Gods.

December 20, 1913,

CURRENCY BILL PASSES SENATE

Owen Measure Adopted, 54 to 34, Six Republicans and One Progressive Supporting It. TRIUMPH FOR PRESIDENT Hitchcock's Substitute Measure, Offered as a Test of Strength, Beaten on Earlier Vote. CONFERENCE MEETS TO-DAY La Follette's Radical Amendment Barring Congressmen from Serving on Bank Boards Accepted. CURRENCY BILL PASSES SENATE

The second great item on President Wilson's heavy legislation programme entered upon its final stage of enactment to-night when the Senate passed the Owen-Glass Currency bill by the overwhelming vote of 54 to 34. Though the measure carried a radical amendment, sponsored by Senator La Follette of Wisconsin, every Democrat present voted for it, and six Republicans -- both regular and progressive -- and one Progressive Party Senator joined them.

The Progressives thought they won when the hauled into the Senate, the Trojan Horse. They thought, if they pass all sort of hedges, rules and regulations, this would prevent the investment bankers from controlling the currency and unilateral, secret rule. How sad is this?

I put in red the parts that the Progressives passed which were destroyed as swiftly as possible. First of all, note the minor role the Treasury Secretary plays today. The position of primacy intended by the passage of this Trojan Horse bill makes it clear, the President puts into power, the Treasury Secretary and HE runs the Federal Reserve! How did the rich people wrest away this power?

HAHAHA. Note the next part I put in red: 'If the stock subscription is inadequate, stock may be offered to the public.' Now, the 'public' in this case who were capable of buying stock in the Federal Reserve was very small indeed. It was the rich banker/investors themselves! And this was the opening they needed to take over the system and control it from within. Note also how careful this new entity is to keep it outside of the Civil Service laws. The opening story here about that recent court ruling is proof that this was intended to keep the Federal Reserve out of the control of the public.

All the rest of the highlighted parts of this newspaper article are things the Federal Reserve chucked out of the window over the last 100 years. With NO votes, NO debate, NO feedback from the populace at large. This is why we can witness a total breakdown in our entire banking system and not one candidate for President except for two who were eliminated instantly, Kucinich and Ron Paul, were willing to discuss. The media was dead set against ANY discussion about ANY of this! Instead, we bounce along going steeply downhill while the media constantly tells us, all will be going uphill thanks to the magicians at the Federal Reserve who will save us.

Back to the top story

1,2] There are no sharp criteria for determining whether an entity is a federal agency within the meaning of the Act, but the critical factor is the existence of federal government control over the "detailed physical performance" and "day to day operation" of that entity. . . . Other factors courts have considered include whether the entity is an independent corporation . . ., whether the government is involved in the entity's finances. . . ., and whether the mission of the entity furthers the policy of the United States, . . . Examining the organization and function of the Federal Reserve Banks, and applying the relevant factors, we conclude that the Reserve Banks are not federal instrumentalities for purpose of the FTCA, but are independent, privately owned and locally controlled corporations.

Each Federal Reserve Bank is a separate corporation owned by commercial banks in its region. The stockholding commercial banks elect two thirds of each Bank's nine member board of directors. The remaining three directors are appointed by the Federal Reserve Board. The Federal Reserve Board regulates the Reserve Banks, but direct supervision and control of each Bank is exercised by its board of directors. 12 U.S.C. Sect. 301. The directors enact by-laws regulating the manner of conducting general Bank business, 12 U.S.C. Sect. 341, and appoint officers to implement and supervise daily Bank activities. These activites include collecting and clearing checks, making advances to private and commercial entities, holding reserves for member banks, discounting the notes of member banks, and buying and selling securities on the open market. See 12 U.S.C. Sub-Sect. 341-361.

One thing that strikes me over and over again is the incestuous relationship the Fed has with itself. It is perfectly clear from the news about the passage of the Owen Glass Act that Congress intended for THEM to decide who runs and who operates the Federal Reserve. Yet here we are, 100 years later, and the Fed gets to choose within itself, who runs it! Now we are in danger of the Fed taking over ALL the government functions for controlling our economy.

From the recent court case declaring the Fed is not part of the Fed:

H.R. Report No. 69 Cong. 1st Sess. 18-19 (1913).

The fact that the Federal Reserve Board regulates the Reserve Banks does not make them federal agencies under the Act. In United States v. Orleans, 425 U.S. 807, 96 S.Ct. 1971, 48 L.Ed.2d 390 (1976), the Supreme Court held that a community action agency was not a federal agency or instrumentality for purposes of the Act, even though the agency was organized under federal regulations and heavily funded by the federal government. Because the agency's day to day operation was not supervised by the federal government, but by local officials, the Court refused to extend federal tort liability for the negligence of the agency's employees. Similarly, the Federal Reserve Banks, though heavily regulated, are locally controlled by their member banks. Unlike typical federal agencies, each bank is empowered to hire and fire employees at will. Bank employees do not participate in the Civil Service Retirement System. They are covered by worker's compensation insurance, purchased by the Bank, rather than the Federal Employees Compensation Act. Employees travelling on Bank business are not subject to federal travel regulations and do not receive government employee discounts on lodging and services.

The Banks are listed neither as "wholly owned" government corporations under 31 U.S.C. Sect. 846 nor as "mixed ownership" corporations under 31 U.S.C. Sect. 856, a factor considered is Pearl v. United States, 230 F.2d 243 (10th Cir. 1956), which held that the Civil Air Patrol is not a federal agency under the Act. Closely resembling the status of the Federal Reserve Bank, the Civil Air Patrol is a non-profit, federally chartered corporation organized to serve the public welfare. But because Congress' control over the Civil Air Patrol is limited and the corporation is not designated as a wholly owned or mixed ownership government corporation under 31 U.S.C. Sub-Sect. 846 and 856, the court concluded that the corporation is a non-governmental, independent entity, not covered under the Act.

Additionally, Reserve Banks, as privately owned entities, receive no appropriated funds from Congress. . . .

And there it is: over a century of litigation that always did the same thing: reduced public powers over the Federal Reserve and increasing private controls over the Federal Reserve. This insidious process is part of the whole Trojan Horse system. All they needed was to get this thing started and bit by bit, they took over the system and then isolated it from all government controls. The final steps are now in motion. Americans, frightened by the effects of the banking mess CREATED BY THE FEDERAL RESERVE ITSELF are now going to be herded into supporting a TOTAL COUP by the same criminals who are doing this to us. The ancient story that is over 2,500 years old about the fox telling the birds to move into his cave so they can be safe, is exactly how things are today.

We are being told, if we move into the Cave of Death, the pirates, bankers, rich people who live in this cave on their beds of gold, will protect us, not eat us. Anyone who imagines they won't utterly enslave and cannibalize us is innocently walking into a trap. When the Trojan Horse was hauled into Troy, Cassandra tried to burn it down. She was stopped. The warriors inside emerged while everyone was asleep and slaughtered, raped and enslaved all the people. Sparing none.

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Comments

[JZ]

The US Congress is made up of a bunch of dumbshits. They want to not have to take any responsibility for anything whatsoever.

Elijah Cummings just referred to Bernanke as a "Superstar"

[John]

No, they're not dumbshits. They're evil, corrupt, traitorous and paid-off.

[rockpaperscizzors]

Interesting read in Bloomberg on the Fed handover of Bear Stearns to JP Morgan:
Fed Should Clarify Link to Bear Stearns Assets: Caroline Baum
April 2 (Bloomberg) -- When the Federal Reserve brokered a weekend deal last month for JPMorgan Chase & Co. to purchase Bear Stearns Cos. before it collapsed, many of the terms of the agreement were murky...

At the time, the Fed said it was taking control of the $30 billion portfolio, that it wasn't purchasing the assets. The Fed was assuming the risk if the eventual liquidation of the securities produced further losses -- losses that accrue to the taxpayer since the Fed turns over its profits to the U.S. Treasury. It also stood to benefit if the portfolio appreciated in value.

That doesn't pass the lender duck test. Lenders don't profit from the appreciation of an asset against which they extend credit. Only an equity owner does.

``They get the residual -- that almost always defines ownership,'' said Paul DeRosa, a partner at Mt. Lucas Management Co. ``The disclaimer of ownership is purely semantic.''

If the Fed is the residual owner of these securities, which seems likely based on its assumption of both risk and reward, it could be in violation of its charter. According to the 1913 Federal Reserve Act, which has been amended over the years, the Fed can buy U.S. Treasury and agency securities, foreign government securities, bankers acceptances, bills of exchange, certain municipal debt, foreign currency and gold.
http://www.bloomberg.com/apps/news?pid=20601039&sid=anrpWCiZbYxQ&refer=home

[rockpaperscizzors]

cont'd....Ownership Society

Nothing in there about collateralized debt obligations, private mortgage-backed securities or other derivatives of questionable quality.

Of course, if the Fed structured its loan as a ``discount'' -- the Fed is authorized to discount drafts, notes and bills of exchange, redeeming them at maturity -- then it would be a lender and a residual owner, said Vince Reinhart, former director of the Fed's Monetary Affairs Division and now a scholar at the American Enterprise Institute in Washington.

Most of today's loans from the Fed are ``advances,'' secured by ``acceptable collateral'' (the level of acceptability keeps declining). The collateral is returned to the borrower after a specified time.

If it seems like a distinction without a difference, it is.

``From an economic perspective, they are the residual claimant,'' Reinhart said. ``They have equity ownership.''

In the spirit of increased transparency, why can't the Fed come out and say that?

Fact(less) Sheet

On March 24, the New York Fed posted a summary of the terms and conditions of the loan on its Web site. In essence, the Fed created an off-balance sheet vehicle -- specifically a Delaware limited liability company -- to hold illiquid securities, and with no capital, funded by a $29 billion loan from the Fed and a subordinated $1 billion loan from JPMorgan, Reinhart said.

The Fed is nothing if not a quick study.

BlackRock Inc. has been retained as the manager.

The summary outlined the maturity of the loan (10 years, renewable at the discretion of the New York Fed); the interest rate on the loan (the primary credit rate, currently 2.5 percent, on the Fed loan; the primary credit rate plus 4.5 percent for JPMorgan); and the repayment terms. It skirted the ownership issue other than to say in the last line that ``any remaining funds resulting from the liquidation of the assets will be paid to the New York Fed.''

Legal Cover

Watching the evolution of Fed policy in the last six months from focused on inflation to fearful of systemic risk; the series of aggressive, rapid-fire rate cuts; the creation of an alphabet soup of new lending facilities; and the orchestration of a fire sale of Bear Stearns to JPMorgan, one has to wonder about the Fed's M.O. It all has a make-it-up-as-you-go-along quality.

Faced with what it thought would be a series of cascading financial failures if Bear Stearns went down, the Fed probably knew what it wanted to do, knew it had to do it quickly, and then had to figure out ``how to get it done within the confines of its legal structure,'' DeRosa said. ``The Fed used legal sleight of hand to reconcile what they wanted to do with what they're permitted to do by law.''

Bernanke is sure to be grilled about his actions when he testifies before the Joint Economic Committee of Congress today and the Senate Banking Committee tomorrow. A wee bit more transparency would be nice.

Then again, if the Fed is acting first and finding legal cover later, there's a benefit to keeping the details murky.

[finop]

agree. now, how can i make some dough the honest way, and plow it into gold and community investment... sigh

[RB]

Many interesting things have been brought together in your latest. Numbers, having an influence other than being mere quantities, are a function of the construction of the cosmos/universe. Apparently these can be used for good or evil and are mostly the private reserve of the secret cabals.

Scientists have discovered and wondered over various unique 'constants' which appear in established natural law. Check out the website markrodin.com for a totally new take on number theory that is having the scientists/mathematicians taking notice and is clearly not yet mentioned in our educational venues.

Speaking of dragons and caves and monetary matters reminds one of warnings given long ago of the dark masters mentioned in the last book of the Bible who use merchandise as a hook and become ecstatic over ultimate and universal control by promoting destruction. Seems to fit the scenario developing today. How do we thank the remote viewers of 2000 or 2500 years ago?

When addressing the validity of Christian or Jewish or even Islamic faith, it is wise to consider who or what has inserted itself as the inspiring entity at the center of these faiths. The early Christian faith was very soon eclipsed by the so-called church fathers' traditions. For those wanting the real story from a marvelous academic of the last century who researched this question and still remains the unchallenged authority, please check out the book ' Marcion, The Gospel of the Alien God' by Adolph von Harnack. It is considered heretical! You'll love it, Elaine.

[GK]

Elaine, I believe this is your most important post EVER.

Most alternative news sites are basically just like sportscasters calling the play by play of these guys looting the country without any comprehension or analysis of why.

I find play by play of baseball, football and looting of the country to be interesting for a short while until you realize you are losing all the time and finally realize the games are rigged.

But you are right when you noted that your attempts to explain anything like this to the masses is pointless as they do not understand or care. The would rather watch WWF 'sports' or Jim Cramer on TV.

But I believe it is critical to get this information back into the thought stream of intelligent people who care, like most your readers, before we are all fed into the wood chipper.

[Elaine Meinel Supkis]

The statue here was given to me by the King of Sikkim back in 1967. It is the emblem of the royal household. It is Pegasus with the Pisces fishes on his wings.

Yes, the connection between magic and money is immensely strong and is acknowledged only passingly.

And of course, the Fed has oozed over the entire land, bit by relentless bit. It is a real eye opener to see how it was restrained at the beginning but how they used various schemes and tools to expand the Fed and cut it off from government restraints.

Frankly, the more I dig, the more annoyed I am. Which is why we will visit the 19th century again to look at the issue of gold and paper money.

[Jim B]

Hi Everyone,

The Secret Architecture of Washington, D.C., is a book of Masonry, of layouts according to longitude and latitude. The Columbine shooting has been analyzed that way. Likewise, Diana's demise, with dates, and times figuring preeminently. I find it fascinating, the more I study it. My friend in Austin, Freeman (freemantv.com), shows his findings on this site.

[Elaine Supkis]

Jim, the surveyor of Washington, DC, was one of my ancestors. Our family has had many astronomers.

[Kurt]

The Court case actually involved an Appellate Court, not the Supreme Court:

Below are excerpts from a court case proving the Federal Reserve system's status. As you will see, the court ruled that the Federal Reserve Banks are "independent, privately owned and locally controlled corporations", and there is not sufficient "federal government control over 'detailed physical performance' and 'day to day operation'" of the Federal Reserve Bank for it to be considered a federal agency:

Lewis v. United States, 680 F.2d 1239 (1982)
John L. Lewis, Plaintiff/Appellant,
v.
United States of America, Defendant/Appellee.
No. 80-5905
United States Court of Appeals, Ninth Circuit.
Submitted March 2, 1982.
Decided April 19, 1982.
As Amended June 24, 1982.

Plaintiff, who was injured by vehicle owned and operated by a federal reserve bank, brought action alleging jurisdiction under the Federal Tort Claims Act. The United States District Court for the Central District of California, David W. Williams, J., dismissed holding that federal reserve bank was not a federal agency within meaning of Act and that the court therefore lacked subject-matter jurisdiction. Appeal was taken. The Court of Appeals, Poole, Circuit Judge, held that federal reserve banks are not federal instrumentalities for purposes of the Act, but are independent, privately owned and locally controlled corporations.

Affirmed.

[Elaine Meinel Supkis]

Yes, it didn't have to go any higher. But whatever does make it up there, the Fed expands its isolation and freedom. It is NOT brought under control.

[Anthony]

ok so let me get this straight.

The US banks made a lot of bad bets and selling useless fancy financial papers that really have no value. (mainly fueled by cheap Yen loan, cheap chinese import, lax US comsumer loan) The war makes gas price spikes and slow the economy. This affect housing. The housing collapse made people call out all this bad debt and funny paper.

The banks can't pay, big daddy Federal Reserve come in and bailing out the banks.

And we are talking about massive amount of "cheap loan/free money". The big excuse is "we need to save the system by injecting liquidity"

But this liquidity is creating gigantic global inflation. Because how current US/global trade is structured. Most 3rd world exporter can't absorb all those liquidity

But they have no other choice except handing more and more money since increasing interest rate will raise consumer debt cost, housing rate. But pumping so much money also create massive spike in commodity price.

So far, by running the dollar global system on overdrive, it seems some of the lost has been digested. But we are not nearing half of the estimated $600-800T bad loans yet. While at the same time at least $200-300B more cash will be thrown into the system in order to make it go even faster.

One think I still can't understand:

where do all those free money coming from? Because by now, the treasury liability will go through the roof. The world market will ask if we can pay all this new loan when it all comes due right? So they won't take treasury bill much longer.

Also: how long can they keep doing this? potentially what's the limiting factor? How much longer can Bush and his gang run the money printer?

[Dutch]

Wave the white flag and pray for a good harvest,but keep hoeing.

[Elaine Meinel Supkis]

Infinity is the theoretical limit. Zimbabwe has 600,000% inflation.

[Dutch]

Thats not a Trojan Horse! Thats an Hindu Girraffe!

[Anthony]

oh yeah. this is not pretty. Now the inflation will hit electricity bill.

http://www.dailykos.com/story/2008/4/3/0229/15683/902/489294

Northern Appalachian coal just hit $110/ton. In 2007, it bottomed out at less than $45/ton, meaning it has nearly tripled in ONE YEAR.

[Elaine Meinel Supkis]

No, Dutch, He is Pegasus. The long neck is amusing, though. When I was given Him at 16 years old, I told everyone, 'Pegasus is my protector.'

I had him with me throughout my global travels. One day, a man decided to break into my room and attack me sexually.

I picked up Pegasus by the neck and clocked him with my Iconic God. Heh. Worked like a charm. My friends loved to joke about that afterwards.

I said, 'I was merciful. I didn't impale that guy with the ears of Pegasus.' Those ears are SHARP AS KNIVES. When packing him, I had to wrap them or they would stab through my luggage.

[blues]

I just figured it out yesterday! The Federal Reserve officials all INSIST that it is an agency of the federal government. And some smart-ass people on economics sites make fun of anyone who claims otherwise.

Iff the Federal Reserve is part of the federal government, then, it's chairman, board members, and other officers can be IMPEACHED by Congress. Otherwise not. Can they be impeached?

Off topic. One of the very select few websites I have a reasonable amount of faith in is:

http://www.whatdoesitmean.com/

This site is apparently run by the Sorcha Faal, which, apparently is the title of the head of a Roman Catholic Order of nuns. I read this at other sites, and I believe it because everything about the site suggests that it is a liberal Catholic operation. I used to volunteer for the Archdiocese of Bridgeport, Connecticut in the '60s, and I know the mind-set.

Yesterday's entry by the Sorcha Faal is a bit alarming:

April 2, 2008

Russia ‘Alarmed’ As US Readies April Nuclear Attack On Iran

http://www.whatdoesitmean.com/index1086.htm

By: Sorcha Faal, and as reported to her Western Subscribers (Traducción al Español abajo)

~~Russian Foreign Ministry Officials are reported to be ‘alarmed’ today over a ‘presentation’ made by the United States War Leaders to President Putin at this weeks NATO summit in Romania and which details the Americans plan to begin a nuclear attack against Irans atomic facilities in the next two weeks.~~

~~Most disturbing of these reports, according to Foreign Ministry Analysts, are the United States ‘offers and threats’ towards Russia to ‘remain neutral’ in this conflict or face the combined weight of the American and EU central banks deliberate collapsing of the Western banking system, and US dollar, and which is estimated will cause the loss of nearly $800 billion of Russian foreign reserves.~~

[Paul S]

Elaine: What is your opinion of William Greider's book on the Federal Reserve? I believe its title is, "How The Federal Reserve Runs the Country"? Greider has written other books on govt. What is your opinion on his writings in general?

[GK]

Paul S, You should read this comment below from Amazon; it is dead on correct.

You MUST read "The Creature from Jekyll Island" if you want to have ANY hope of figuring out what is going on.

From Amazon reviews: 1 star, Tom Potts

"Good propaganda must be mostly truth to work. As I write, this book has a rating of 4 1/2 stars out of 5. This is an indication that the majority of reviewers have bought into the well spun propaganda Greider delivers.

The Federal Reserve is a 100% privately owned corporation, carefully set up to appear as though it is an arm of government. It was created solely for the benefit of it's shareholders, a significant proportion of which are foreign. Greider could have mentioned this extremely important fact at the outset. Instead he deliberately helps perpetuate the myth that "The Fed" is public.

He spends the rest of the 700+ pages going into excruciating detail about The Fed's decisions and their direct effects on the economy, with a focus on the time of Volcker's reign. If that's what you're looking for, this is the book for you. If you're looking for true insight into The Fed, its origins, who it benefits, and how it directly controls the largest economy in the world (and indirectly many other economies through their privately owned central banks) at the expense of everyone else, then I'd suggest reading "The Creature from Jekyll Island".

[Elaine Supkis]

A lot of people hated Volker. I must be one of the few who understands why he did what he had to do. I will now write my response to all this. In a parable.

[GK]

High interest rates are absolutely wonderful for savers and my cash gets almost 9% here in New Zealand. I go where my money gets respected.

Interest rates are the price of money. The beauty of a free market for money is that the interest rates rise when there is a high demand for money, and drop when there is too much money saved.

It is a painfully beautiful system. However, we have given a MONOPOLY PRICING POWER OVER THE PRICE OF MONEY TO THE FEDERAL RESERVE.

It is like giving the right to set the price of oil to the FEDERAL OIL RESERVE.

Once you give someone this power it is IRRESISTABLE to drop it to increase demand wildly (cheap loans), and then raise it to get things back under control again (credit crunch).

In a free market for money there ARE business cycles but they are NATURAL and very shallow as it self corrects. As too many people save, interest rates drop and people start borrowing and spending. If people save too little, interest rates rise to tempt them to save.

But when the FEDERAL RESERVE LLC has control of the process, and they know exactly how, when and by how much interest rates will change, they can make virtually INFINITE amounts of money going short and long the bond market.

People going bankrupt and defaulting on their loans makes virtually no difference to them.

A trick question they ask you when you interview in Wall Street straight out of the ivy league is "Which way do you think interest rates will go?" Any answer other than 'I Don't Know' is incorrect. Because if you knew where interest rates were going you could make INFINITE amounts of money limited only by your avarice and chances of getting caught by the population.

So, while the high interest rates in NZ are nice, I am clearly aware that the NON-FREE market could drop them on a whim and crush the value of their currency as money flees to higher interest rates.

[blues]

In twenty years, the Oil runs out. Then, there will be no more of this bullmanure "free market" theology! The trucks will simply stop bringing up the lettuce! Reality doesn't give a damn about the economic theology of the goofy humans.

[Paul S]

Hi Elaine. Thanks for the tip on "The Creature from Jekyll Island". I purchased it today. Browsing through it, seems like quite a eye-opening read, like you said. (This won't put me on some sort of watch list will it? j/k.) But seriously, do those who control the Fed EVER get nervous, that their looting of national treasuries may be discovered and thwarted? I'm not referring to a loss here and there, but a serious defeat. I wouldn't think they would be worried.

[Paul S]

http://www.bigeye.com/griffin.htm That is a link to a talk by "The Creature From Jekyll Island" author, G. Edward Griffin. The talk summarizes what is in the book. If some here have not already accessed this site, I think it is well worth the time to read this trnscript of Mr. Griffin's talk. I'm wondering: is there ANYTHING that can rattle these guys' cage? Or are they so egotistical they feel untouchable? I don't mean a setback here or there, but a real, serious cut to their power, one(s) they can't weasel around? Think they are capable of murdering someone who gets a little close for his/her own good?

[Elaine Meinel Supkis]

They use the media to call people like me, 'conspiracy theorists'. And if you really want to be mocked, talk about the Real Rulers and point out the places they gather.

If you want to be come a non-person, go to those places and raise a ruckus. The meet in places surrounded by troops who have orders to kill anyone who gets past the lines of armed guards.