Federal Reserve Returns to Scene of Crime - Jekyll Island

[Cruise]

Source

I guess, since so many have figured out the Fed is just a financial scheme (scam), why not celebrate it?

The Fed at Jekyll Island: 100 Years Later, They're Baaack!

Well isn't this cute?

Just days after the Federal Reserve will announce it has launched QE2, the Fed will hold a major conference at Jekyll Island.

The island is off the coast of the U.S. state of Georgia.

In November 1910, Senator Nelson W. Aldrich and Assistant Secretary of the Treasury Department A.P. Andrews, and other top financiers,arrived at the Jekyll Island Club to discuss monetary policy and the banking system. The secret meetings led to the creation of the Federal Reserve.

Forbes magazine founder Bertie Charles Forbes wrote several years later:
Picture a party of the nation's greatest bankers stealing out of New York on a private railroad car under cover of darkness, stealthily riding hundred of miles South, embarking on a mysterious launch, sneaking onto an island deserted by all but a few servants, living there a full week under such rigid secrecy that the names of not one of them was once mentioned, lest the servants learn the identity and disclose to the world this strangest, most secret expedition in the history of American finance. I am not romancing; I am giving to the world, for the first time, the real story of how the famous Aldrich currency report, the foundation of our new currency system, was written...

The utmost secrecy was enjoined upon all. The public must not glean a hint of what was to be done. Senator Aldrich notified each one to go quietly into a private car of which the railroad had received orders to draw up on an unfrequented platform. Off the party set. New York's ubiquitous reporters had been foiled... Nelson (Aldrich) had confided to Henry, Frank, Paul and Piatt that he was to keep them locked up at Jekyll Island, out of the rest of the world, until they had evolved and compiled a scientific currency system for the United States, the real birth of the present Federal Reserve System, the plan done on Jekyll Island in the conference with Paul, Frank and Henry... Warburg is the link that binds the Aldrich system and the present system together. He more than any one man has made the system possible as a working reality.

On November 6 of this year, Federal Reserve Chairman Ben Bernanke will speak on 'Federal Reserve: Past and Present' before the 'A Return to Jekyll Island: The Origins, History, and Future of the Federal Reserve' conference hosted by the Federal Reserve Bank of Atlanta at the Jekll Island Club Hotel.

The conference opens a day earlier on Friday, November 5, when Federal Reserve Bank of Atlanta President Dennis Lockhart gives welcome remarks.

Also at the conference:

Federal Reserve Bank of Philadelphia President Charles Plosser will moderate a discussion of a paper, 'To Establish a More Effective Supervision of Banking: How the Birth of the Fed Altered Bank Supervision'

Federal Reserve Bank of Cleveland President Sandra Pianalto will moderate a discussion of a paper, 'The Promise and Performance of the Federal Reserve as Lender of Last Resort 1914-1933'.

Federal Reserve Bank of Dallas President Richard Fisher will moderate a discussion of a paper, 'Where It All Began: International Trade, the Market for Acceptances, and the Making of Lending of Last Resort in Britain'

Federal Reserve Bank of St. Louis President James Bullard will moderate a discussion of a paper, 'From Passing Legislation to Building an Institution: Perspectives on the Early Years of the Federal Reserve System'

Federal Reserve Bank of St. Louis President James Bullard will moderate a discussion of a paper, 'The Fed from the Treasury-Fed Accord (1951) until the End of Monetary Targeting (1982)'.

Federal Reserve Bank of Richmond President Jeffrey Lacker will moderate a discussion of a paper, 'The Recent Financial Turmoil: New Directions for Monetary Policy Analysis'.

Federal Reserve Bank of Chicago President Charles Evans will moderate a panel on 'The Role of Research in Monetary Policy Deliberations'.

Federal Reserve Bank of Minneapolis President Narayana Kocherlakota will speak on 'Policy and Asset Bubbles'.
Needless to say, nothing good can come out of a conference of Fed members talking to each other after just launching QE2 and who will be "inspired" by the historic Jekyll Island location.

Given the current Fed chairman loves new "tools" by which to inflate the currency and that the conference will be about discussing new tools and old, these guys will be re-enforcing each others mad thinking that they can micro-manage the economy without creating dangerously high inflation and that they are not directly responsible for the recent boom-bust cycle.

 

[Lamarr]

While all eyes are on the election Wake up people!

 

[Lamarr]

So............they don't need congressional authority to do this?

Fed Takes Bold, Risky Step To Bolster Weak Economy

WASHINGTON (Reuters) - The Federal Reserve launched a fresh effort to support a struggling U.S. economy on Wednesday, committing to buy $600 billion in government bonds despite concerns the program could do more harm than good.

The decision takes the Fed into largely uncharted waters and is aimed at further lowering borrowing costs for consumers and businesses still suffering in the aftermath of the worst recession since the Great Depression.

The U.S. central bank said it would buy about $75 billion in longer-term Treasury bonds per month through the end of June 2011 and could adjust purchases depending on the strength of the recovery.

"The economy is slowly digging itself out of a deep hole," said Brian Bethune, economist at IHS Global Insight in Lexington, Massachusetts. "The Fed is making the right moves here to nudge the pace up a little," he said.

Critics within and outside the central bank fear the Fed's policy will lead to high inflation and worry that low interest rates in the United States risk fueling asset bubbles in other countries and destabilizing currencies.

But with the U.S. economy expanding at only a 2.0 percent annual pace in the third quarter of this year and the jobless rate seemingly stuck around 9.6 percent, the Fed had come under pressure to do more to stimulate business activity. HIGH

 

[Cruise]

Capitalism has its proponents, but when it produces systems like the Federal Reserve, it makes one wonder.

If you want the lowdown, watch this video.

Reality of Money – G. Edward Griffin (author of Creature from Jekyll Island)

excerpt...

It’s not an exaggeration to say that the entire nation is working to support an invisible master. And doing so without resentment or complaint because for the most part the people are totally unaware of that fact. They have been economically conquered in a quiet war of which they have been totally unaware. Mariner Eccles was the governor of the Federal Reserve system in 1941. And on June 24 of that year, Eccles was asked to give testimony before the House Committee on Banking and Currency. Now, he didn’t like to do that. And reading through that testimony is interesting because, you think politicians can sidestep answers and be like a greased eel, you should read the testimony of the governors of the Federal Reserve Board. They’re masters. But in this one segment he was pretty straight forward. The purpose of the hearing was to obtain information regarding the role of the Federal Reserve in creating the conditions that led to the depression of the 1930s. I want to talk about that later.

Congressman Wright Patman, who was Chairman of that Committee asked,

“How did you get the money to buy those $2 Billion worth of government securities in 1933?”

Eccles answered, “We created it.”

Patman, “Out of what?”

Answer (Eccles), “Out of the right to issue credit money.

Question, “And there is nothing behind it is there except our government’s credit?”

Answer, “That’s what our money system is. If there were no debts in our money system there wouldn’t be any money”, end quote.

 

[blancasa]

http://af.reuters.com/article/metalsNews/idAFN0422739520101104

UPDATE 2-Ron Paul vows renewed Fed audit push next year
Thu Nov 4, 2010 10:10pm GMT

Print | Single Page
[-] Text [+]

* Urges return to gold standard

* Republican says also to scrutinize IMF

(Adds additional detail, background, quotes, byline)

By Andy Sullivan

WASHINGTON, Nov 4 (Reuters) - U.S. Republican Representative Ron Paul on Thursday said he will push to examine the Federal Reserve's monetary policy decisions if he takes control of the congressional subcommittee that oversees the central bank as expected in January.

"I think they're way too independent. They just shouldn't have this power," Paul, a longtime Fed critic, said in an interview with Reuters. "Up until recently it has been modest but now it's totally out of control."

Paul is currently the top Republican on the House of Representatives subcommittee that oversees domestic monetary policy, and is likely to head the panel when Republicans take control of the chamber in January.

That could create a giant headache for the Fed, which earlier this year fended off an effort headed by Paul to open up its internal deliberations on interest rates and monetary easing to congressional scrutiny.

Paul, who has written a book called "End the Fed," has been a fierce critic of the central bank's efforts to boost the economy through monetary policy.

..much respect Doc. Let's try to get in these scammish organizations guts n either curtail or eradicate their hustle. would be a nice show come January.
.. cop 'End the Fed' by Ron Paul..

 

[QueEx]

UPDATE 2-Ron Paul vows renewed Fed audit push next year
Thu Nov 4, 2010 10:10pm GMT

Don't forget to post a link to the source of the article.

Thanks,

QueEx

 

[Lola]

What a fucking mess.

Last night I watched a DVD of PBS Frontline, that examined the events that led to financial collapse in 2008. The things that were done made my head spin. All those CEOs and Wall Street types who bettted billions on money that didn't exist, those exotic money programs that were created that caused this MESS-----THEY SHOULD ALL BE IN JAIL. This is nothing short of criminal.

 

[blancasa]

What a fucking mess.

Last night I watched a DVD of PBS Frontline, that examined the events that led to financial collapse in 2008. The things that were done made my head spin. All those CEOs and Wall Street types who bettted billions on money that didn't exist, those exotic money programs that were created that caused this MESS-----THEY SHOULD ALL BE IN JAIL. This is nothing short of criminal.

,,add the bailout package by their sponsors, GW + BHO.

 

[blancasa]

History..

http://www.globalresearch.ca/index.php?context=va&aid=12947

Washington DC, March 22 – On the eve of the long-awaited London conference of the G-20 nations, we are rapidly descending into the chaos of a Second World Economic Depression of catastrophic proportions. In the year since the collapse of Bear Stearns, we have moved toward the disintegration of the entire globalized world financial system, based on the residual status of the US dollar as a reserve currency, and expressed through the banking hegemony of London, New York, and the US-UK controlled international lending institutions like the International Monetary fund and the World Bank. This is a breakdown crisis of world civilization, prepared over decades by the folly of deindustrialization and the illusions of a postindustrial society, further complicated by the deregulation and privatization of the leading economies based on the Washington Consensus, itself a distillation of the economic misconceptions of the Austrian and Chicago monetarist schools. If current policies are maintained, we face the acute danger of a terminal dollar disintegration and world hyperinflation.

The G-20 leaders are must deliberate a new set of policies capable of leading humanity out of the current crisis. We must first identify the immediate cause which has detonated the present unprecedented turbulence. That cause is unquestionably the $1.5 quadrillion derivatives bubble. Derivatives have provoked the downfall of Bear Stearns, Countrywide, Northern Rock, Lehman Brothers, AIG, Merrill Lynch, and Wachovia, and most other institutions which have succumbed. Derivatives have made J.P. Morgan Chase, Bank of America, Citibank, Wells Fargo, Bank of New York Mellon, Deutsche Bank, Société Générale, Barclays, RBS, and money center banks of the world into Zombie Banks.

Derivatives are financial instruments based on other financial instruments – paper based on paper. Derivatives are one giant step away from the world of production and consumption, plant and equipment, wages and employment in the production of tangible physical wealth or hard commodities. In the present hysteria of the globalized financial oligarchy, the very term of “derivative” has become taboo: commentators prefer to speak of toxic assets, complex securities, exotic instruments, and counterparty arrangements. At the time of the Bear Stearns bankruptcy, Bernanke warned against "chaotic unwinding." All of these code words are signals that derivatives are being talked about. Derivatives include such exchange traded speculative instruments as options and futures; beyond these are the over-the-counter derivatives, structured notes, and designer derivatives. Derivatives include the credit default swaps so prominent in the fall of AIG, collateralized debt obligations, structured investment vehicles, asset-backed securities, mortgage backed securities, auction rate securities, and a myriad of other toxic variations. These derivatives, in turn, are pyramided one on top of the other, thus creating a house of cards reaching into interplanetary space.

As long as this huge mass of kited derivatives was experiencing positive cash flow and positive leverage, the profits generated at the apex of the pyramid were astronomical. But disturbances at the base of the pyramid turned the cash flow and exponential leverage negative, and the losses at the top of the pyramid became immense and uncontrollable. By 2005-6, the disturbances were visible in the form of a looming crisis of the automobile sector, plus the slowing of the housing bubble cynically and deliberately created by the Federal Reserve in the wake of the collapse of the dot com bubble, the third world debt bubble. and the other asset bubbles favored by Greenspan. Financiers are trying to blame the current depression on poor people who acquired properties with the help of subprime mortgages, and then defaulted, thus – it is alleged -- bringing down the entire world banking system! This is a fantastic and reactionary myth. The cause of the depression is derivatives, and this means that the perpetrators to be held responsible are not poor mortgage holders, but rather globalized investment bankers and hedge fund operators, the derivatives merchants. We are now in the throes of a world wide derivatives panic. This panic has been gathering momentum for at least a year, since the fall of Bear Stearns. There is no power on earth which can prevent this panic from destroying most of the current mass of toxic derivatives. It is however possible that the ongoing attempts to bail out, shore up, and otherwise preserve the deadly mass of derivatives will destroy human civilization as we have known it. We must choose between the continued existence of derivatives speculation on the one hand, and the survival of human society worldwide on the other. If this be crude populism, make the most of it.

FREEZE DERIVATIVES FOR THE DURATION OF THE CRISIS

The G-20 must remove the crushing mass of derivatives which is now dragging down the world economy. Derivatives must be banned going forward, but this by itself will not be sufficient. The ultimate goal must be to wipe out and neutralize the existing mass of $1.5 quadrillion in notional values of toxic derivative instruments. Some governments may be able simply to decree that derivatives be shredded, deleted, and otherwise liquidated, and they should do so at once. Virtually all governments should be able to use their emergency economic powers to freeze derivatives and set them aside for at least five years or for the duration of the crisis, whichever lasts longer. Legal issues can be settled over the coming decades in the courts. Humanity is in agony, and we must act against derivatives now. Going forward, we must ban the paper pyramids of derivatives in the same way that the Public Utility Holding Company Act of 1935 banned the pyramiding of holding companies.

Derivatives were illegal in the United States between 1936 and 1983. In 1933, an attempt was made to corner the wheat futures market using options, and the resulting outcry led to a 1936 federal law banning such options on farm commodity markets. This ban was repealed by the Futures Trading Act of 1982, signed by President Reagan in January 1983. During the G.H.W. Bush administration, Wendy Gramm of the Commodity Future Trading Commission went further, promising a “safe harbor” for derivatives. Despite the key role of derivatives in the Orange County disaster during the Clinton years, a valiant attempt by Brooksley Born of the CFTC to make derivatives reportable and subject to regulation was defeated by a united front of Robert Rubin, Larry Summers (today running US economic policy), and Greenspan. Despite the central role of $1 trillion of derivatives in the Long Term Capital Management debacle of 1998, Phil Gramm’s Commodity Futures Modernization Act of 2000 guaranteed that derivatives, notably credit default swaps, would remain totally unregulated. These pro-derivatives forces must bear responsibility for the current depression, and those still in power must be ousted

The Bush-Paulson-Obama-Geithner policy pursued by the United States, which amounts to a $10 trillion (Fed and Treasury) effort to bail out the world derivatives bubble on the backs of taxpayers, can only make the depression worse, will never lead to an economic recovery, and must therefore he rejected. Krugman is right: the “zombie ideas” rule Obama’s Washington. The Fed’s TALF amounts to subsidies for securitization, meaning more derivatives. The derivatives bailout was pioneered by Gordon Brown, Alistair Darling, and Mervyn King in the case of Northern Rock. These efforts are doomed to costly futility. The $1.5 quadrillion derivatives bubble is comparable to the black holes of astrophysics, those artifacts of gravity collapse which will irresistibly suck in all matter that comes near them. This compares to a world GDP of a mere $55 trillion, itself a figure inflated by financial speculation. The derivatives are the black holes of financial engineering, and can easily consume all the physical wealth and all the money in the world, and still be bankrupt. Gordon Brown’s demand of $500 billion for the IMF is enough to bankrupt several nations, but pitifully inadequate to deal with the derivatives. They can only be dealt with by re-regulation -- a quick freeze, leading to extinction and permanent illegality. We reject Brown’s IMF world derivatives dictatorship.

Derivatives pose the question of fictitious capital -- financial instruments created outside of the realm of production, and which destroy production. In 1931-2, fictitious capital appeared as tens of billions of dollars of reparations imposed on Germany, plus the war debts owed by Britain and France to the United States. These debts strangled world production and world trade. Bankers and statesmen tried desperately to maintain these debt structures. But US President Herbert Hoover proposed the Hoover Moratorium of 1931-1932, a temporary freeze on all these payments. The Lausanne Conference of June 1932 was the last chance to wipe out the debt permanently. But the Lausanne Conference failed to act decisively, and passed the buck. By the end of 1932, there was near-universal default on reparations and war debts anyway. And by January 1933, Hitler had seized power. We urge the London G-20 to defend world civilization against derivatives. It is time to lift the crushing weight of derivatives from the backs of humanity before the world economy and the major nations collapse into irreversible chaos and war, as seen during the 1930s.

..this is painful.

 

[QueEx]

<font size="5">
After big move, Fed looks in the mirror</font size>


Washington Post
By Neil Irwin
Sunday, November 7, 2010


JEKYLL ISLAND, GA. - The bankers who gathered on this island resort a century ago
to plot out what would become the Federal Reserve System did so secretly, traveling
under fake names to avoid attracting attention.

The people who run the organization that those bankers dreamed up were rather less
subtle this time around. As Fed Chairman Ben S. Bernanke and a long list of past and
present Fed officials gathered this weekend for a conference on the history of the
central bank, they were surrounded by security guards in black sport-utility vehicles
and TV cameras broadcasting their conversation around the world.

That conversation, particularly a Saturday panel discussion featuring Bernanke, his
predecessor, Alan Greenspan, and former New York Fed president Gerald Corrigan,
offered a window into how the leaders of the Federal Reserve view their achieve-
ments and failures, and their role in a post-financial-crisis world. In particular,
Bernanke painted some of the decisions he has made both during the financial crisis
and this past week as consistent with the Fed's founding mission, hammered out on
this island a century ago.

The central bank has had no shortage of trials and failures in its first hundred years -
the Great Depression of the 1930s and the Great Inflation period of the 1970s most
prominent among them. The challenge of the 2010s, it increasingly appears, will be
dealing with the aftermath of the most recent financial panic and the Great Recession.


The nation is still grappling with the economic devastation those events wrought,
most evident in a 9.6 percent unemployment rate. Just last week, the Fed took
unconventional steps to try to bring that rate down and to draw inflation up a bit
from its rock-bottom levels, pledging to buy $600 billion of bonds to try to push
down long-term interest rates.

Speaking at the "Return to Jekyll Island" conference sponsored by the Atlanta Fed,
Bernanke argued that the steps are not as revolutionary as many observers in the
financial markets and the news media have suggested.

"There's a sense out there that, quote, quantitative easing or asset purchases are
some completely foreign, new, strange kind of thing and we have no idea what . . .
is going to happen," Bernanke said, sitting onstage in a conference space that was
once J.P. Morgan's indoor tennis court. "Quite the contrary - this is just monetary
policy. . . . It will work or not work in much the same way that ordinary, more
conventional, familiar monetary policy works."

Corrigan, who was a key lieutenant of Fed Chairman Paul A. Volcker and is now a
Goldman Sachs managing director, acknowledged some "uneasiness" with that
approach.

"If you seek to nudge up the inflation rate," he said, "even with very, very low
rates of capacity utilization in the labor market . . . is there a risk that getting
inflation to 2 percent may turn out to be easier than capping it at 2 percent?"

"That's the source of uneasiness that I wanted to register," Corrigan added.

Bernanke defended the action.

"I have rejected any notion that we are going to try to raise inflation to a super-
normal level in order to have effects on the economy," he said.

"We're not in the business of trying to create inflation," Bernanke said. Rather,
he said, the Fed is trying to avoid a further drop in inflation.

In recent decades, the major mission of the Fed has been to manage the money
supply to try to stabilize the economy. But when the Fed was founded - the
private discussions at Jekyll Island in 1910 were followed by congressional passage
of the Federal Reserve Act of 1913 and the creation of the Fed in 1914 - its main
mission was to prevent bank panics that had intermittently ravaged the U.S.
economy from 1873 to 1907.

In other words, the Fed was a lender of last resort to the banking system long
before it was in charge of stabilizing the economy and inflation more generally. After
all, when there was a gold standard, there was little ability to expand or contract
the money supply.

Bernanke described the breakdown of several key financial markets during 2007
and 2008 - the short-term funding markets that investment banks used to finance
their operations, for example - as a 21st-century version of those pre-1914 bank
runs.

Those complex securities had "the same structure as a bank, except they didn't
have the protections, the guarantees and the oversight that a bank has," Bernanke
said. Referring to a series of unconventional Fed programs launched to pump money
into various corners of the financial system, he added, "I really think of it as a classic
lender-of-last-resort response, adapted for the complexity of the financial system."

To many Fed critics, a central failure over the past three decades has been the
perceived willingness of the central bank to take action to prop up financial markets
whenever they are faltering, a phenomenon known as the "Greenspan Put," which
uses the term for an option that protects against an asset losing value.

The criticism is that by standing in to prevent precipitous declines in financial
markets, the Fed made it appear that one could invest without risk - and that this
led investors to be overly complacent about risk, which in turn fueled the panic of
2007 to 2009.

Given that his own policies have helped prop up stock prices in the past year,
Bernanke echoed the phraseology of some of his critics and referred to the
phenomenon, almost sheepishly, as the "Greenspan/Bernanke Put."

Greenspan was unrepentant.

"If in effect the Greenspan Put is the notion which says you're stabilizing the system,
then I hope so - that's what we're here for," the former Fed chairman said. "I don't
really have an understanding of why that has become a pejorative term. . . . If I
understand it, what we're doing is what we should be doing."

Greenspan recalled when, early in his tenure as Fed chairman, the stock market
collapsed on a single day in October 1987. The next morning, White House Chief of
Staff Howard Baker called. He articulated a single word: "Help!"

During the same period, his colleague Corrigan had a slightly different message for
the new Fed chairman: "Okay, buddy, it's all on your shoulders."


http://www.washingtonpost.com/wp-dyn/content/article/2010/11/06/AR2010110604006.html

 

[Lamarr]

“The U.S. government has a technology, called
a printing press, which allows it to produce as many
U.S. dollars as it wishes at essentially no cost.”

- Benjamin S. Bernanke Chairman, U.S. Federal Reserve

 

[QueEx]

- Benjamin S. Bernanke Chairman, U.S. Federal Reserve

How about NOT quoting without citing. Some people, me included, would like to read the quote, in context.

QueEx

 

[Greed]

A Locked Door, A Secret Meeting And The Birth Of The Fed

A Locked Door, A Secret Meeting And The Birth Of The Fed (15:02)
December 20, 2013 8:20 PM

On today's show, we tell the creation story of the Federal Reserve — one of the most powerful financial institutions on the planet.

The story includes a 70-year-old man with a bad head cold and a bunch of mistresses, a nation that's deeply ambivalent about a central bank, and a secret meeting at an island with a sketchy name.

Our guests are Liaquat Ahamed, author of Lords of Finance, and Gary Richardson, Federal Reserve System historian and professor at UC Irvine.

http://www.npr.org/blogs/money/2013...oor-a-secret-meeting-and-the-birth-of-the-fed