"Mr. Volcker's politics is something of an enigma."--New
Since 1933 when Eugene Meyer resigned from the Federal Reserve
Board of Governors, no member of the international banking families
has personally served on the Board of Governors. They have chosen
to work from behind the scenes through carefully selected presidents
of the Federal Reserve Bank of New York and other employees.
The present chairman of the Federal Reserve Board of Governors
is Paul Volcker. His appointment was greeted by one well-known
economist with the following prediction, "Volcker's selection
has been by far the worst. Carter has put Dracula in charge of
the blood bank. To us, it means a crash and depression in the
80s is more certain than ever."
Col. E.C. Harwood's Research Report, August 6, 1979, gave much
the same view. "Paul Volcker is from the same mold as the
unsound money men who have misguided the monetary actions of
this nation for the past five decades. The outcome probably will
be equally disastrous for the dollar and the U.S. economy."
Despite these gloomy views, the report from The New York Times
on the selection of Volcker was positively ecstatic. On July
26, 1979, The Times commented that Volcker learned "the
business" from Robert Roosa, now partner of Brown Brothers
Harriman, and that Volcker had been part of the Roosa Brain Trust
at the Federal Reserve Bank of New York, and, later, at the Treasury
in the Kennedy administration. "David Rockefeller, the chairman
of Chase, and Mr. Roosa were strong influences in the Mr. Carter
decision to name Mr. Volcker for the Reserve Board chairmanship."
The New York Times did not point out that David Rockefeller and
Robert Roosa had previously chosen Mr. Carter, a member of the
Trilateral Commission, as the presidential candidate of the Democratic
Party, or that Mr. Carter would hardly refuse to appoint their
choice of Paul Volcker as the new Chairman of the Federal Reserve
Board. Nor is it straining the point to be reminded that this
manner of selection of the Chairman of the Board of Governors
is directly in the line of royal prerogative going back to George
Peabody's initial agreement with N.M. Rothschild, to the Jekyll
Island meeting, and to the enactment of the Federal Reserve Act.
The Times noted that "Volcker's choice was approved by European
banks in Bonn, Frankfurt and Zurich." William Simon, former
Secretary of Treasury, was quoted as saying "a marvelous
choice." The Times further noted that the Dow market rose
on Volcker's nomination, registering the best gains in three
weeks for a rise of 9.73 points, and that the dollar rose sharply
on foreign exchange@ at home and abroad.
Who was Volcker, that his appointment could have such an effect
on the stock market and the value of the dollar in foreign exchange?
He represented the most powerful house of "the London Connection,"
Brown Brothers Harriman, and the London houses which directed
the Rockefeller empire. On July 29, 1979, The Times had said
of Volcker, "New Man Will Chart His Own Course".
Volcker's background shows that this was nonsense. His course
has always been charted for him by his masters in London. He
attended Princeton, obtained an M.A. at Harvard, and went to
the London School of Economics 1951-52, the banker's graduate
school. He then came to the Federal Reserve Bank of New York
as an economist from 1952-57, economist at Chase Manhattan Bank,
1957-61, with Treasury Department 1961-65, as deputy under secretary
for monetary affairs, 1963-65, and under secretary for monetary
affairs, 1969-74. He then became President of the Federal Reserve
Bank of New York from 1975-79, when Carter, at the behest of
Robert Roosa and David Rockefeller, appointed him Chairman of
the Federal Reserve Board of Governors. He was succeeded as President
of Federal Reserve Bank of New York by Anthony Solomon, a Harvard
Ph.D. who was with the OPA 1941-42 and with the government financial
mission to Iran 1942-46. He operated a canned food company in
Mexico from 1951-61, was president of International Investment
Corp. for Yugoslavia 1969-72 (a communist country), under secretary
for monetary affairs at Treasury 1977-80. In short, Solomon's
background was much the same as Paul Volcker's.
The New York Times stated on December 2, 1981, "For years
the Federal Reserve was the second or third most secret institution
in town. The Sunshine Act of 1976 penetrated the curtain a trifle.
The board now holds a public meeting once a week on Wednesday
at 10 a.m., but not to discuss Monetary policy, which is still
regarded as top secret and not to be discussed in public."
The Times mentioned that when Open Market Committee meetings
are held, Solomon and Volcker sit together at the head of the
table and relay the instructions which they have received from
Behind Volcker and Solomon stands Robert Roosa, Secretary of
the Treasury in Carter's shadow cabinet, and representing Brown
Brothers Harriman, the Trilateral Commission, the Council on
Foreign Relations, the Bilderbergers, and the Royal Economic
Institute. He is a trustee of the
Rockefeller Foundation*, and a director of Texaco and American
Express companies. Dr. Martin Larson points out that "The
international consortium of financiers known as the Bilderbergers,
who meet annually in profound secrecy to determine the destiny
of the western world, is a creature of the Rockefeller-Rothschild
alliance, and that it held its third meeting on St. Simons Island,
only a short distance from Jekyll Island." Larson also states
that "The Rockefeller interests work in close alliance with
the Rothschilds and other central banks."**
On June 18, 1983, President Ronald Reagan ended months of speculation
by announcing that he was reappointing Paul Volcker as Chairman
of the Federal Reserve Board of Governors for another four year
term, although Volcker's term was not up until August 6, 1983.
Reagan's reappointment of a Carter appointee puzzled some political
observers, but apparently he had succumbed to considerable pressure,
as indicated by a lead editorial in The Washington Post, June
10, 1983, "There is no one who matches Mr. Volcker in both
political standing and grasp of the intricate networks that make
up the world's financial system." The anonymous writer gave
no documentation for his elevation of Volcker to the standing
of the world's greatest financier, and as for his political standing,
The New York Times commented on June 19, 1983, "Mr. Volcker's
politics is something of an enigma." His "non-political"
stance conforms with the Washington tradition of "the political
independence of the Fed" which has been maintained for many
years. However, the problem of its dependence on "the London
connection" has never been discussed in Washington.
In reality, Volcker is more of a politician than an economist.
After attending the London School of Economics, and finding out
who issues the orders of the international financial community,
Volcker has ever since played the game. Not once has he failed
to carry out the orders of the "London Connection".
Can it really be possible that "The London Connection"
exists, and that men like Volcker and Solomon receive their instructions,
in however devious or indirect a manner, from foreign bankers?
Let us look at the evidence, circumstantial, to be sure, but
circumstantial evidence of the quality which has often sent men
to the penitentiary or to the electric chair. John Moody pointed
out in 1911 that seven men of the Morgan group, allied with the
Standard Oil-Kuhn, Loeb group, ruled the United States. Where
do these groups stand in the financial picture today?
U.S. News published on April 11, 1983, a list of the largest
bank holding companies in the United States by assets as of December
31, 1982. Number 1 is Citicorp, New York, with assets of $130
billion. This is Baker and
* See Chart V
** See Chart I
Morgan's First National Bank of New York, merged with National
City Bank in 1955, two of the largest purchasers of Federal Reserve
Bank of New York stock in 1914. Number 3, is Chase Manhattan,
New York, with assets of $80.9 billion. This is Chase and Bank
of Manhattan merged, the Rockefeller and Kuhn Loeb group, also
purchasers of Federal Reserve Bank of New York stock in 1914.
Number 4 is Manufacturers Hanover of New York $64 billion, also
purchaser of Federal Reserve Bank of New York stock in 1914.
Number 5 is J.P. Morgan Company of New York, $58.6 billion in
assets and holder of considerable Federal Reserve Bank stock.
Number 6 is Chemical Bank of New York, $48.3 billion also purchaser
of Federal Reserve stock in 1914. And Number 11, First Chicago
Corporation, the First National Bank of Chicago which was principal
correspondent of the Morgan-Baker bank in New York, and which
furnished the first two presidents of the Federal Advisory Council.
The direct line which leads from the participants in the Jekyll
Island Conference of 1910 to the present day is illustrated by
a passage from "A Primer on Money", Committee on Banking
and Currency, U.S. House of Representatives, 88th Congress, 2d
session, August 5, 1964, p. 75:
"The practical effect of requiring all purchases to be made
through the open market is to take
money from the taxpayer and give it to the dealers. It forces
the Government to pay a toll for
borrowing money. There are six 'bank' dealers: First National
City Bank of New York; Chemical
Crop. Exchange Bank, New York, Morgan Guaranty Trust Co., New
York, Bankers Trust of New York, First National Bank of Chicago,
and Continental Illinois Bank of Chicago."
Thus the banks which receive a "toll" on all money
borrowed by the Government of the United States are the same
banks which planned the Federal Reserve Act of 1913. There is
ample evidence demonstrating the present preeminence of the same
banks which set up the Federal Reserve System in 1914. For instance,
Warren Brookes writes on the editorial page of The Washington
Post, June 6, 1983:
"Citicorp (National City Bank and First National Bank of
New York, merged in 1955) just
recorded an 18.6% return on equity, J.P. Morgan, 17%, Chemical
Bank and Bankers Trust, nearly 16%, an exceptional rate of return."
These are the banks which bought the first issue of Federal Reserve
Bank stock in 1914, and which owned the controlling interest
in the Federal Reserve Bank of New York, which sets the interest
rate and is the bank for all open market operations.
These banks also profit steadily from the otherwise inexplicable
fluctuations in monetary growth and interest rates. Brookes further
comments on "actual monetary growth rates alternately gyrating
from 0 to 17% in successive six month periods for three recession-wracked
years. The two measures of money growth most admired by Milton
Friedman M2 and M3,
have actually shown little change on a year to year basis in
the 1972-82 period."
Thus we have money growth rates gyrating from 0 to 17% but no
actual year to year changes, which raises the question of why
we cannot have stability of monetary growth throughout the year.
The answer is that the big profits are made by these gyrations,
and the next question is, who sets in motion these gyrations?
The answer is "the London Connection".
To draw attention from the continued control of the bankers and
their heirs, who obtained the government monopoly of the nation's
money and credit in 1913, the paid propagandists of the controlled
media monopoly and academia are constantly trotting forth new
and more exotic theories of economics. Thus James Burnham, one
of the National Review propagandists, won fame with a ridiculous
theory of "the managers". He postulated that the old
arbiters of wealth, the J.P. Morgans, the Warburgs and the Rothschilds
had, by 1950, disappeared from the scene, being replaced by a
new class of "managers". This theory, which had no
foundation in fact, served to obscure the fact that the same
people still controlled the monetary system of the world. The
"managers" were just that, executives like Volcker
who were front men, paid employees who would continue to receive
their paychecks only as long as they carried out their employers'
instructions. Burnham remains a well-paid propagandist at the
National Review, which many prominent leaders, including President
Reagan, believe to be a "conservative" publication.
From 1914 to 1982, a period in which many thousands of American
banks went bankrupt, the original purchasers of Federal Reserve
Bank stock have not only survived but they have consolidated
their power. And what of "the London Connection"? Does
it still exist, and is it still dictating the economic destiny
of the United States? The Washington Post, May 19, 1983, carried
a story datelined Nairobi, Kenya, noting the meeting of the African
Development Bank. "The British merchant bank, Morgan Grenfell
and a syndicate of the United States, Kuhn Loeb, Lehman Brothers
International, the French Lazard Freres and Britain's Warburg
are discreetly acting as financial advisors to about ten debt-plagued
There are the same names we encountered in 1914, still managing
the finances of the world, with profits for themselves but with
disastrous results for everyone else. Perhaps we can look for
relief to the present Administration of President Reagan. Unfortunately,
before reaching him we have to run the gamut of the long list
of his principal staff, composed of men from J. Henry Schroder,
Brown Brothers Harriman, and other leading components of "The
Lopez Portillo, President of Mexico, in addressing the Mexican
National Congress of Mexico in September, 1982, called the world
credit boom of the past decade a financial pestilence akin to
the Black Death which swept
Europe in the fourteenth century. "As in mediaeval times,
it flattens country after country. It is transmitted by rats
and it yields unemployment and misery, industrial bankruptcy
and enrichment by speculation. The remedy prescribed by faith
healers is forced inactivity and depriving the patient of food."
Forbes Magazine stated October 11, 1982, "The world gasps
for liquidity, not because the supply of money has contracted
but because too much of it now goes to pay off old debts rather
than fund new productive investments."
The policy of high interest rates and tight money has been disastrous
for the United States. In early 1983, a slight easing of money
and credit promises some relief, but as long as the Federal Reserve
system and its unseen manipulators continue their control of
the money supply, we can expect more problems. The Nation on
December 11, 1982, in commenting on economic problems, stated,
"The blame for all this lies at the door of the Federal
Reserve System working as usual on behalf of the international
The evidence of how the Federal Reserve System works on behalf
of the international banking system is graphically illustrated
by a series of charts drawn up by the staff of the Committee
on Banking, Currency and Housing of the House of Representatives,
94th Congress, 2d session, August, 1976, "FEDERAL RESERVE
DIRECTORS: A STUDY OF CORPORATE AND BANKING INFLUENCE".*
We present as our Chart V page 49 of this study, showing the
interlocking directorates of David Rockefeller. As our Chart
VI we reproduce page 55 of this study, showing the interlocking
directorates of Frank R. Milliken, one of the Class C Directors**
of the Federal Reserve Bank of New York. In this chart are all
the main personages in our story of the Jekyll Island conference:
Citibank, J.P. Morgan and Company, Kuhn Loeb and Company, and
many related firms. As Chart VII we reproduce page 53 of this
study, showing the interlocking directorates of another Class
C Director of the Federal Reserve Bank of New York, Alan Pifer.
As President of the Carnegie Corporation of New York, he interlocks
with J. Henry Schroder Trust Company, J. Henry Schroder Banking
Corporation, Rockefeller Center, Inc., Federal Reserve Bank of
Boston, Equitable Life Assurance Society (J.P. Morgan), and others.
Thus an August, 1976 study from the House Committee on Banking,
Currency and Housing, brings before us all of our main cast of
personages, functioning today just as they did in 1914.
* Due to space limitations, only five of the seventy-five charts
in the study, all of which show the connections between prominent,
powerful individuals with control in the Federal Reserve System
have been selected to illustrate the connections between officers
and directors of the twelve Federal Reserve Banks in 1976 and
the firms listed in this book.
** "The three Class C Directors are appointed by the Board
of Governors as representatives of the public interest as a whole."
p. 34, Congressional Study, 1976.
This 120 page Congressional study details public policy functions
of the Federal Reserve District Banks, how directors are selected,
who is selected, the public relations lobbying factor, bank domination
and bank examination, and corporate interlocks with Reserve banks.
Charts were used to illustrate Class A, Class B, and Class C
directorships of each district bank. For each branch bank a chart
was designed giving information regarding bank appointed directors
and those appointed by the Board of Governors of the Federal
In his Foreword to the study, Chairman Henry S. Reuss, (D-Wis)
"This Committee has observed for many years the influence
of private interests over the
essentially public responsibilities of the Federal Reserve System.
As the study makes clear, it is difficult to imagine a more narrowly
based board of directors for a
public agency than has been gathered together for the twelve
banks of the Federal Reserve
Only two segments of American society--banking and big business--have
representation on the boards, and often even these become merged
directorates . . . . Small farmers are absent. Small business
is barely visible. No women appear on
the district boards and only six among the branches. Systemwide--including
district and branch
boards--only thirteen members from minority groups appear.
The study raises a substantial question about the Federal Reserve's
oft-repeated claim of
"independence". One might ask, independent from what?
Surely not banking or big business, if
we are to judge from the massive interlocks revealed by this
analysis of the district boards.
The big business and banking dominance of the Federal Reserve
System cited in this report can be traced, in part, to the original
Federal Reserve Act, which gave member commercial banks the
right to select two-thirds of the directors of each district
bank. But the Board of Governors in
Washington must share the responsibility for this imbalance.
They appoint the so-called "public"
members of the boards of each district bank, appointments which
have largely reflected the same
narrow interests of the bank-elected members . . . . Until we
have basic reforms, the Federal
Reserve System will be handicapped in carrying out its public
responsibilities as an economic
stabilization and bank regulatory agency. The System's mandate
is too essential to the nation's
welfare to leave so much of the machinery under the control of
narrow private interests.
Concentration of economic and financial power in the United States
has gone too far."
In a section of the text entitled "The Club System",
the Committee noted:
"This 'club' approach leads the Federal Reserve to consistently
dip into the same pools--the
same companies, the same universities, the same bank holding
companies--to fill directorships."
This Congressional study concludes as follows:
"Many of the companies on these tables, as mentioned earlier,
have multiple interlocks to the Federal Reserve System. First
Bank Systems; Southeast Banking Corporation; Federated Department
Stores; Westinghouse Electric Corporation; Proctor and Gamble;
Alcoa; Honeywell, Inc.; Kennecott Copper; Owens-Corning Fiberglass;
all have two or more director ties to district or branch banks.
In Summary, the Federal Reserve directors are apparently representatives
of a small elite group which dominates much of the economic life
of this nation." END OF CONGRESSIONAL REPORT.