(Almost) everything you ever wanted to know about the Federal Reserve System but never thought to ask, author Andrew Gause delivers succinctly in this Veritas interview. And yes, the institution, a group of private American banks handed extraordinary powers to profit from the printing, lending and manipulation of American dollars, is bad news for the country, at least as Gause explains it. And no, not much will change as long as the majority of Americans have a near zero understanding of the money system that runs this country. Via Gause's impressive depth of historical, political and monetary knowledge, we learn that: In 1934 Franklin Roosevelt signed an executive order requiring [legally confiscating] that all gold in the country - coins and bullion - be sent to the Federal Reserve Bank of New York, where it still sits in its basement. All the gold in the Ft. Knox belongs to the Federal Reserve. 100% of everything we pay in income tax is used to pay interest to the Federal Reserve for money it has "lent" the government. How The Fed makes its money-- They make their money in two ways: (1) on interest from loans it makes to the government, and (2) via financial operations. They get to manipulate interest rates, and this is where the real power lies, they get to buy notes issued by other entities with money that they create. "This allows, effectively, the owners of The Fed to siphon off a greater portion of the productive capacity of this nation, and pay themselves enormous amounts of money for providing what amounts to little more than a dubious service." Historical precursors to The Fed-- The Federal Reserve's forerunners were two institutions: the First Bank of the United States, which ended with the War of 1812, and the Second Bank of the United States which was killed by Andrew Jackson, who said they were a den of vipers. "Once Jackson forced them into the daylight, their power was revealed and they were swatted down. I'd like very much for that to happen with the Federal Reserve. So Americans can see what they're doing." What's corrosive about The Fed-- "No question about it: The Federal Reserve Bank, and its owners, own and control the bulk of the wealth of the United States?The Fed is the preeminent financial power in the world." The Federal Reserve banks and their revolving door, incestuous relationship with the big 22 (Citigroup, Goldman Sachs, JPMorgan Chase, etc.) are making top tier money men rich and powerful, while the rest of us divvy up the crumbs, and that's the way they want it. Why The Fed deal is still there-- President Lincoln intended to get rid of the Federal Reserve Bank and issue U.S. notes once the war was over. Greenbacks, he called them. But Lincoln was murdered. So, in comes Garfield, intent upon doing the same. Garfield is murdered. Then in comes McKinley, intent upon doing the same. McKinley is murdered. The next and last advocate of bye-bye Fed was John F. Kennedy? Plus, "The Fed is the number one contributor to BOTH parties. This is why you don't hear anyone speak out in more than a whisper about them." A little known fact-- In 1934 and in 1950, the U.S. declared bankruptcy, Chapter 13, a reorganization. We are not solvent now. We are bankrupt, and we are still reorganizing. How to rectify trade imbalances with China-- "We made China. The minute you have strong tariffs on products coming into the country is the moment corporations start moving back into this country. We don't have free trade, or fair trade. We have managed trade. And it's not in the best interest of the U.S. worker. " What's going to happen to the dollar-- The dollar will be with us for the remainder of the decade at minimum, mainly because the most powerful financial conglomerate on the planet is perpetuating it. Not to mention the fact that: "It is backed with F16s and Marines." And, "any nation that challenges the dollar's supremacy has met a sad fate." Investment advice-- Invest in gold, silver, valuable metals. "With $15 trillion in circulation and only 260-million ounces of gold on the books, that's a ratio of $57,000 an ounce." Author's conclusion-- Money should be issued by the government. Not by private profiteers. Yet, "until people understand how the money system works, I don't see any chance of us getting out of this mess."
Andrew is Chairman and CEO of SDL inc. He has attracted a following with thousands of TV and radio appearances. He publishes a newsletter, THE WORLD OF MONEY, in its 20th year, and has authored three books. The Secret World of Money (1996) challenges a wide range of topics dealing with the history and future of money. Y2KAOS(1999) examined the y2k problem and made specific recommendations. (One of the few Y2K books still in print!) Uncle Sam Cooks the Books (2003) Examined Federal accounting activities and accurately forecast the Fannie Mae and Freddie Mac problem and other monetary shenanigans.
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