PlotAgainstTheDollar soverein

8/22/2019 PlotAgainstTheDollar soverein

1/10


2/10

Published by:World Currency Watch

Currency Capitalist98 S.E. 6th Avenue, Suite 2,Delray Beach, FL 33483 USA

USA oll Free el: 800-818-6934Email: [email protected] site: www.worldcurrencywatch.com

Copyright 2011 byCurrency Capitalist. All international and domestic rights reserved. No part o this publication maybe reproduced in any orm, printed or electronic, without prior written permission rom the publisher, Currency Capital-ist.

Notice: Tis publication is designed to provide accurate and authoritative inormation in regard to the subject mattercovered. It is sold and distributed with the understanding that the authors, publisher and sellers are not engaged in ren-dering legal, accounting or other proessional advice or service. I legal or other expert assistance is required, the serviceso a competent proessional advisor should be sought.

Te inormation and recommendations contained in this brochure have been compiled rom sources considered reliable.Employees, ocers, and directors oCurrency Capitalistdo not receive ees or commissions or any recommendations oservices or products in this brochure. Investment and other recommendations carry inherent risks. As no investment rec-ommendation can be guaranteed, Currency Capitalisttakes no responsibility or any loss or inconvenience i one choosesto accept them.

Any inormation or statements contained in this publication are not to be considered by the reader as personalized in-vestment advice. Te authors and any agents oCurrency Capitalistare not licensed under U.S. or other securities laws toaddress particular investment situations and nothing herein should be deemed as personalized investment advice.


3/10

1

The Plot Against the Dollar

The Shocking Truth Behind the Demise of the Dollar

I the American people ever allow private banks to control the issue o their currency, rstby ination, then by deation, the banks and corporations that will grow up around them willdeprive the people o all property until their children wake up homeless on the continent theirathers conquered. Tomas Jeferson

Some truths are stranger than ction. Tis is one o them.

It is the truth behind the undoing o the U.S. dollar. About a conspiracy so vast, with so much atstake it took 16 years to accomplish and brought together two o the ercest rivals on Wall Street.

It is the story o the creation o an unregulated, unaccountable, privately held power that wouldwield total at control over the currency o a nation. And bring about its demise.

What happened to cause this spiral into worthlessness? Lets have a look

The Original Money

During the 19th century, the U.S. currency was backed by gold. One U.S. dollar was dened as1/20th o an ounce o gold. In purchasing goods and services individuals either used gold coins,or deposited their coins in banks, and were given banknotes that were redeemable in gold. Papercurrency was simply the IOU o an individual bank or, in some cases, o businesses. A promise to

pay gold.

A typical dollar banknote would carry the legend, Te Banko XYZ will pay to the bearer on demand One Dollar. As longas the issuer had enough gold to back up the notes it had issued,the dollar was as good as gold.

Loans made by banks to businesses or the government wereessentially claims on gold. Gold held the banks vault. Te prudent banker kept enough gold inreserve in the vault to meet normal withdrawals by depositors. I a banker kept too little in reserveand depositors tried to withdraw more gold than the bank had in the vault, the banker had to callin sucient loans to meet withdrawals. I he couldnt, or i he couldnt borrow enough rom otherbanks or shareholders, his bank went bankrupt.

As there was no government guarantee behind bank deposits, depositors were cautious abouttrusting their local bank. Tey kept a wary eye on the banker. And i it was suspected a banker wasmaking risky loans, word got around. Some depositors would withdraw their deposits. As or thenotes, as word spread, the outstanding notes o the bank began to be discounted in the marketplace.Tat is, they traded or less than the ace value. Rating services sprung up that would publish lists obanknotes and the discount at which they were being traded.


4/10

2

Prudent bankers avoided problems by careully scrutinizing borrowers, and always keeping amplegold in reserve. With so many eyes watching the bankers, it was normal or the more conservativebanks to keep 50% o their deposits in gold in the vault to cover withdrawals.

Te important point is that with gold as money, credit expansion beyond minimal levels wasabsolutely constrained by the ability o individuals to demand gold or their banknotes. Tis was the

shield that kept credit bubbles rom starting. Neither the bankers who wanted to make more loans,nor the politicians that wanted borrow were able to get around the publics ability to run the bank.

Gold provided checks and balances on all monetary expansion.

It also provided a severe limit to the protability o banks and more importantly the bankers whoran them.

A Plan for Liberating the Currency From Its Golden Straight Jacket

Since the inception o our country, the powers within government have debated the merits

o a central bank. It was the topic o erce debate between the early liberal republican ollowerso Alexander Hamilton and the hard money democrats led by Andrew Jackson. It continuedthroughout the years.

Te ounding athers were all too aware o the signicance o controlling a countrys currency. Aswere a group o nancial giants who saw the concept as the key to securing their wealth orever.

Many people believe that the United States central bank was set up in response to the panic o1907. In act, nothing could be urther rom the truth. Te push to monopolize monetary creationbegan years earlier.

An earlier attempt was made with the National Banking System Acts o 1863 1864 and 1865. Asystem was set up to give a network o ederally chartered national banks sole power to issue banknotes. Te idea was to centralize the power to issue currency behind Wall Street banks so they couldbe bailed out when they made bad or over-loaned money.

Te results, however, did not go quite as planned. State, savings and private banks all recoupedtheir losses by simply expanding demand deposits on their books. Further, they competed moreercely with Wall Street banks or nancial business. By 1896, these banks comprised ully 54% oall banks resources.

And that was enough or Wall Street.

In those days, Wall Street nance was dominated bytwo erce rivals J.P. Morgan and John D. Rockeeller.Virtually the entire Wall Street banking community at thetime ell into line behind one o these giants. But such wasthe importance o gaining ultimate control over the issueo money, these two rivals laid aside their dierences andjoined orces to push or the creation o a central bank.

But, they could not do it openly

J.P. Morgan John D. Rockefeller


5/10

3

In 1896, yet another push was undertaken to centralize the issue o currency. Tis time, however,the powers that were had a much better idea o what had to be done.

First, a new monetarist threat led by populist William Jennings Bryan had to be dealt with. TeBryan camp was in avor o infating money by doing away with the gold standard in avor o a moreplentiul silver standard. Increasing the amount o backing or a currency would expand the money

supply while keeping hard money checks in place. Tis heresy would have to be put down.

Tis was accomplished by the consortium o banks by their supportor and with the election o William McKinley a erce gold standardproponent. But more importantly, an advocate o the progressive era areormist movement avoring the common man. Tis second actor wouldprovide them an angle or accomplishing their second task.

Tat task promised to be ar more dicult. Convincing both the publicand legislature who were both vehemently anti-monopoly that acentral bank was actuallygoodor the economy and main street.

Teir idea: they would put orward the proposition that a central banking power was in the best interestso banks, the currency and the common man by reigning in the potential ree market power abuses thenancial markets supposedly aced at the time. Te Wall Street powers-that-be would embrace it as amorally necessary thing to do even at their own expense. And all would be right in the world.

(Te reasoning put orward is still the biggest lie trumpeted by the Fed and its supporters today.In a 2008 article, Bloomberg reported that Fed Chairman Ben Bernanke told Senator Evan Bayh inan April hearing on the Bear Stearns bailout, the truth is that the beneciaries o our actions werenot Bear Stearns and were not even principally Wall Street. It was Main Street.)

Tey set out to accomplish this by undertaking (completely covertly) a grassroots movement orcurrency reorm on the part o businesses in the heartland. It was key to keep Wall Street interest asar rom the limelight as possible.

Te movement was ocially launched by Hugh Hanna, President o the Atlas Engine Works inIndianapolis (a more Midwestern company could not have been selected) and erce proponent othe gold standard. In 1896 he sent a memorandum to the Indiana Board o rade suggesting thatIndiana take the lead in a currency reorm movement.

Tis suggestion was quickly embraced by the IB and lead to the ormation o the IndianapolisMonetary Commission who sent a resolution to President McKinley urging him to 1) continue tomaintain the gold standard and 2) orm a commission to investigate creating a more elastic currency.

Naturally McKinley endorsed the commissions recommendation and orwarded this idea o amonetary commission to congress. It ailed, however, to pass in the Senate.

Undeterred, the Indianapolis Monetary Commission took matters into its own hands. It set upshop in Washington and began a public relations campaign that was second to none at the time.Tey began employing all manner o opinion shaping resources. From media and journalists toeconomists and academics to business proessionals. Questionnaires were sent out, with predictableresults, and the conclusions were published throughout the media.

William McKinley


6/10

4

Beore long the commission had gained enough support to pass the Gold Standard Act o 1900.Unknown to nearly everyone, however, this act contained buried language avoring increasing theelasticity o the money supply.

Tis conspiratorial assault continued with secret participation rom the highest echelons onancial banking until the political landscape could be shaped just so as to allow the passage to the

necessary legislation.

And by 1908 that landscape was in place. Te banking industry had put in place enough supportto orm a new National Monetary Commission under the auspices o Senator Nelson Aldrich thehead o the Senate Finance Committee (and ather-in-law o J.D. Rockeeller.)

Currency reorm legislation began being drated and nally on a rigid November night in 1910a group o seven men boarded a rail car at the New Jersey railway station bound or a retreat at aprivate resort on Jekyll Island. Going only by their rst names (and in some cases pseudonyms) thetravelers included a virtual whos who o banking and political elite at the time:

Nelson Aldrich Chairman o the Senate Finance Committee, Morgan business associate and

in-law to RockeellerA. Piatt Andrew Assistant Secretary o the U.S. reasuryFrank Vanderlin President o the National City Bank o New York and Rockeeller AssociateHenry Davison Senior partner o the J.P. Morgan CompanyCharles Norton President o JP Morgans First National Bank o New YorkBenjamin Strong head o JP Morgans Bankers rust CorpPaul Warburg Partner in Kuhn Loeb & Company, representative o the Rothschild bankingdynasty in England and associate o JD Rockeeller.

For ten days they labored, hammering out the ramework or what would become the FederalReserve Act. But even upon its completion, this precious legislation was held back. Treatened by a

Democratic surge in Congress in 1910 and the uncertainty o the presidential election in 1912 theycould not risk having the bill shot down.

With the election o Woodrow Wilson a leading proponent o progressive era politics advancedby Morgan and Rockeeller or their own ends in 1912, they nally had thenal key they needed. Renaming the act or Virginia Representative Carter Glass(to remove any partisan appearances) the bill was passed into law in December1913.

And the course o American monetary policy was changed orever

A Quick Look at the Nature of Money

Lets consider, or just a moment, the concept o money.

Money is nothing more than a medium or exchanging goods and services. In the early days ocivilization, bartering was an accepted orm o transacting business. Exchanging goods or othergoods o relative value.

Under this system, there were no standardized prices per se, but rather things were valued based

Woodrow Wilson


7/10

5

on the need or them and their supply. And in general it worked relatively well.

But the barter system had some practical limitations.

First, when bartering, dividing payment was oten dicult i not impossible. I I take a cow to themarket and trade it or ten bushels o grain rom the local elevator, thats ne. I, however, I took my

cow to market and wanted to buy two bushels o grain, and a ew bolts o cloth and some tools I hada problem. Tere was eectively no way to make change or my cow.

It also created a problem on the business side. Especially where accounting was concerned. Itbecame virtually impossible to gure one periods prots against another. I I earned two cows in onemonth versus a hog, 4 wagon wheels and 100 yards o rope in another, how was I doing?

Tese limitations posed serious problems where the issues o exchange were concerned andeventually gave way to the need to standardize money.

Originally, a medium o exchange a currency was thought to require its own inherentvalue. Something o value on its own. For centuries even millennia precious metals were the

commodity used in this capacity. Tey were ideal or the purpose.First, they were considered valuable on their own. But at the same time they werent so rare as to

make them limited access. Second, they were portable and easily divisible which meant you couldcarry an amount around with you wherever you went. And you could buy whatever you needed inthe quantities you desired. Finally, they were homogeneous and durable. Tey could be minted intoidentical coins and would last a long time. All the ideal traits or a orm o currency.

And gold as a commodity was deemed perectly suited to this task.

Creating MoneyWithoutValue

Everything in the world has inherent value. A value in and o itsel based on what it provides you.Your car gets you to and rom work. Te ood you buy at the store eeds your amily. ools you mayhave in your garage help you x things up around the house.

And the value o everything is determined by its supply relative to the demand or it.

Except, that is, or money today. Te Federal Reserve has seen to that.

By creating a central bank, they also created a central depository or hard money deposits. Teywould hold all banks gold and issue them credits based upon their holdings. Essentially the Fedcould issue currency credits as they saw t. Tis eectively tookthe gold standard out o playeven though it was still technically in orce. (Ater 1971, however, the gold standard was ocially

abolished and at money Federal Reserve notes backed by the ull aith o the government became the de acto currency.)

Now the value o money is based solely on what someone will give you in exchange or it. Period.And it could be produced virtually at will. Tat is, in act, the great irony the very currency weuse as a medium o exchange has absolutely no intrinsic value.

How much is a dollar worth? oday its worth about a pack o gum. Maybe a bottle o pop. A ewyears back, however, it might have bought you two packs o gum. People will say the price o gum


8/10

6

has gone up which is true. But what has also happened is the value o your dollar (in terms o gum orpop) has gone down. Why is that?

Well the supply o at money works inthe exact opposite manner to anything that itvalues.

Economists oten talk about an optimalsupply o money. You rarely hear them talkabout an optimal supply o anything else.Te act is, all goods are scarce in relation toconsumer wants. So all things being equal thegreater the supply o anything, like crude oilor corn, the cheaper that good becomes andthe better o everyone is. Te higher yourstandard o living.

Money cant be consumed or used up like any other physical commodity. Money is only a mediumo exchange. All it does is acilitate the transer o goods and services.

You can think about it another way. I the supply o a commodity rises above the amount that asociety will consume or whatever reasons, its price comes down until demand picks back up.

Money on the other hand, is a tool o DEMAND. Te greater the supply o money in circulation,generally the greater potential demand or everything else. Driving real asset prices higher and higher.In eect devaluing its own purchasing power.

Interesting twist isnt it?

Money also has another interesting characteristic. It is ungible which means that its

homogeneous - interchangeable. Tis brings up the crucial issue o how its supply can be so easilymanipulated.

Depositing, Borrowing, and Lending

Now think about a deposit or just a moment. Lets say that you go to a local storage acilityand hand over your home entertainment center or sae keeping while your living room is beingremodeled. You get a claim check when you drop it o.

When the remodeling work is done, you go back with your ticket and get all your electronicsback. I the proprietor o the storage place tried to pawn o someone elses goods on you, youd be on

the phone to the police in a minute. Tats because your goods that you let were clearly identiable.Tis isnt the same with things that are homogeneous or ungible. Standardized things like

commodities ormoney.

Say you take 5000 bushels o Grade XYZ grain to the local elevator to store. When you needit to take to market you go back to the elevator to claim your grain. Do you necessarily want your5000 bushels back? No. All you want is 5000 bushels o Grade XYZ grain.


9/10

7

Tis has signicant implications or the elevator operator. As long as he keeps enough grain onhand to satisy redemption demands, he can pretty much do whatever he would like with the rest ohis inventory. Tis is what is called a ractional reserve system. It means that I only need to keep aportion o my deposits on hand to satisy demands. Now think o this in terms o money

As a banker, I can lend out any amount o my assets as long as demands or actual cash do not

exceed what I have on hand. Demands rom depositors are rarely a problem. Where I do run into aproblem are demands rom other banks.

Say I have $1,000,000 on deposit. I I make $500,000 in loans and those loans are deposited atother banks, theyll demand a transer o cash. Now I have $500,000 on deposit. I or any reason mylending exceeds my ability to meet those demands, I go bankrupt.

Te threat o this bankruptcy creates a check on my scal responsibility, even in a system o atmoney. It also throws a wrench in my protability. Because the more I can lend and nance, themore money I can make.

Excessive lending is no problem i Im the only bank in business. But the problem becomes

signicant when you have multiple banks competing toward the same end. Te only way to solvethis problem is to control expansion or lending among banks at an equal rate.

Enter the Central Bank

Making a Dime Worth a Dollar

Tis is the very end the Federal Reserve was created to achieve. A monopolized growth in themoney supply. ake a look at how it works

As youve seen, multiple banks all lending against reserves on hand orces scal responsibility. Butnow what happens when you put a central bank in the middle o all o this? A centralized accounting

system that doubles as the lender o last resort. You get a central set o books through which the Fed canmaintain a balanced growth o credit and come to the rescue o any member banks who get into trouble.

Tey accept deposits, whether it be cash, nancial or physical assets at 1/10th value. So i a bankdeposits reserves o $100,000 on the books at the Fed, as ar as theyre concerned the bank can lendout 10 times that or $1,000,000!

Demand deposits exchange hands and banks that receive credits rom depositors are then placed asreserves on the books o the Fed and their balance sheets expand by a actor o ten!

Tis model ocreatingcash has spiraled all the way down to consumers. Tose who carry balanceson their credit cards are eectively doing the same thing as the banks. Maybe they have $2,000 in

savings but are carrying a $10,000 balance on their cards. Teyve spent 5 times the money they haveand have increased the money supply by as much.

Te ractional reserve system o the banking industry has unleashed an uncontrollable monster oinfation. Since the creation o the Fed in 1913, the value o our currency has collapsed. What wasworth $1 back then is only worth 4.8 cents today! Tats a 95% devaluation o your money.

And there is no bottom to the devaluation. Just think about it or a minute. I you take $1,000and devalue it by 90% you have $100. Devalue that by 90% and youre let with $10. ake away


10/10

8

another 90% and you have $1. Another90% and youre down to a dime. Ten apenny. Ten ractions o a cent.

How is this possible? Call it infation.What you could have bought or only $1 in

1980 now costs you $20 And in another5 or 10 years itll cost you even more.

Tis is the ugly reality o the FederalReserve and its ractional reserve system.

Expanding the supply o credit anddoling out money to its member banksas needed to keep them solvent has been the Feds sole raison dtre. All the while devaluing thecurrency. And all in the name o protecting the common man rom the potential abuses o the reemarket.

Ironic isnt it?

So Where Are We Now?

So what have the actions o the Fed and the banking system achieved? Near total devaluation oour currency. Tey have created a pyramid o lending by which they have consistently expanded themoney supply or nearly 100 years.

Te bubbles that have exploded today are the result o nothing more than too much money inthe system. And when one bubble pops, the only politically acceptable way the Fed can come to therescue is by adding more liquidity more cash to the system and infating everything even more.

Te current credit cycle has been going on or the nearly the last 30 years. Te last Fed chairmanwho showed any scal responsibility was Paul Volcker. When he reigned in the money supply back inthe late 70s, interest rates soared to over 21% and everyone, everywhere elt the pinch. Prices soared.Spending was dampened. And infation came back into line.

oday there is little hope o anyone ever doing something like that again. It is simply ar too easyto keep throwing money at problems and creating ever more and worse bubbles.

At some point, however, the cycle has to end. It simply cant be sustained orever withoutunthinkable consequences. o continue to infate at such outrageous rates threatens to throw theeconomy into a state o hyper-infation.

Te only course o action that investors have today is to take matters into their own hands. Andyouve taken the rst step by reading this brie expos o the Federal Reserve. By understandingthe true nature o the beast and what they are inficting on the economy, the dollar and investorsthroughout the country.

Keep reading the other Currency Capitalistpremiums to discover all the options and opportunitiesthat are available to you. Tey will let you ree yoursel rom this plot against the dollar.

Documents

PlotAgainstTheDollar soverein