The Creature From Jekyll Island: There Is Nothing Federal About the Federal Reserve. Part 1

In November 1910, a group of men boarded a private train car in New Jersey and traveled to Jekyll Island, Georgia under assumed names. They were told to speak to no one, use no last names, and tell no one where they were going.

They were not spies. They were bankers. And over the next nine days they wrote the blueprint for the institution that would control the American money supply for the next century.

Their names were Nelson Aldrich, the Senate Republican majority leader. Frank Vanderlip of National City Bank. Henry Davison of J.P. Morgan. Paul Warburg of Kuhn, Loeb and Company. Benjamin Strong of Banker's Trust.

This is not a conspiracy theory. G. Edward Griffin documented it. The participants themselves later confirmed it. Frank Vanderlip wrote about it in the Saturday Evening Post in 1935.

What came out of Jekyll Island, after several legislative iterations, was the Federal Reserve Act of 1913.

So what exactly did they build?

The Federal Reserve is not a government agency. It is a privately owned central bank operating under a federal charter. Its twelve regional banks are owned by member banks in their districts. Those member banks hold stock. That stock pays dividends.

The Fed sets interest rates, controls the money supply, serves as lender of last resort, and regulates the banking system. It does all of this with a level of independence that no actual government agency has. The Chairman testifies before Congress twice a year. That is the extent of the accountability.

When you wonder why the people who crashed the global economy in 2008 not only kept their jobs but got bonuses paid for with your tax dollars, this is part of the answer. The institution responsible for oversight of the banking system is staffed and influenced by the banking system. The creature guards itself.

There is nothing Federal about it

The name is deliberate misdirection. Naming it the Federal Reserve made it sound like a government institution when it is not. This was part of the original design. The bankers at Jekyll Island knew a central bank controlled by private financial interests would never pass Congress if people understood what it actually was. So they made it sound like a public utility.

It is not a public utility. It is a legal cartel. The Federal Reserve Act handed a private consortium of banks the exclusive right to create the national currency and loan it to the government at interest. The government, which theoretically has the power to coin money under the Constitution, has been paying interest on its own currency ever since.

When the government needs money, it does not print it. It issues treasury bonds. The Fed buys those bonds by creating money from nothing. The government now owes that money back with interest. The national debt is not the result of overspending alone. It is structurally guaranteed by the mechanism.

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