1757
Benjamin Franklin travels to England and would spend the next 18 years of his life there until just before the start of the American Revolution.
1760
Mayer Amschel Bauer changes him a name to Mayer Amschel Rothschild and sets up the House Of Rothschild, and soon learns that if he loans out money to Governments and Royalty then this is far more profitable than loaning to individuals. This is because the loans made are bigger and backed by their nations’ taxes. He trains his five sons in the art of money creation.
1764
Benjamin Franklin is asked by officials of the Bank of England to explain the prosperity of the colonies in America. He replies,
“That is simple. In the Colonies, we issue our own money. It is called Colonial Scrip. We issue it in proper proportion to the demands of trade and industry to make the products pass easily from the producers to the consumers. In this manner creating for ourselves our own paper money, we control its purchasing power, and we have no interest to pay no one.”
As a result of Franklin’s statement, the British Parliament hurriedly passed the Currency Act of 1764. This prohibited colonial officials from issuing their own money and ordered them to pay all future taxes in gold or silver coins. Referring to after this act was passed, Franklin would state the following in his autobiography,
“In one year, the conditions were so reversed that the era of prosperity ended, and a depression set in, to such an extent that the streets of the colonies were filled with the unemployed … The colonies would gladly have borne the little tax on tea and other matters had it not been that England took away from the colonies their money which created unemployment and dissatisfaction.
The viability of the colonists to get power to issue their own money permanently out of the hands of King George III and the international bankers was the prime reason for the revolutionary war.”
Control of America’s money system will change hands 8 times since 1764.
1775
April 19th, start of the revolutionary war in Lexington, Massachusetts. By this time the colonies had been drained of silver and gold coins as a result of British taxation. As a result of this, the continental government had no choice but to print money to finance the war.
At the start of the revolution the American money supply stood at $12,000,000. By the end of the war it was nearly $500,000,000 and as a result the currency was virtually worthless. An example of this is that a pair of shoes now sold for $5,000 dollars. This also shows the danger of printing too much money. The reason Colonial Scrip had worked was because just enough was used to facilitate trade.
1781
Towards the end of the American Revolution the Continental Congress were desperate for money, so they allowed Robert Morris, their Financial Superintendent, to open a privately owned central bank, in the hope this would sort out the money problem.
Morris was a wealthy man who had grown wealthier during the revolution by trading in war materials. This first central bank in America was called the Bank of North America, which was set up with a four year charter, and was closely modeled after the Bank of England. It was allowed to practice the fraudulent system of fractional reserve banking, so it could create money it didn’t have, then charge interest on it.
The bank’s charter called for private investors to put up $400,000 of initial capital, which Morris found himself unable to raise. Nevertheless he unashamedly used his political influence to have gold deposited in the bank, which had been loaned to America by France. Morris then loaned the money he needed to buy this bank from this deposit of gold that belonged to the government, or rather the American people.
This Bank of North America, again deceptively named so the common people would believe it was under the control of the government, was given a monopoly over the national currency.
1785
Despite the promises of Robert Morris that his privately owned Bank of North America would solve the problem with the money supply, of course the economy continued to plummet, forcing the Continental Congress not to renew the bank’s charter. The leader of the effort to kill this bank was William Findlay of Pennsylvania, who stated,
“This institution, having no principle but that of avarice, will never be varied in its objective … to engross all the wealth, power and influence of the state.”
Mayer Amschel Rothschild moves his family home to a five storey home in Frankfurt, Germany, which he shares with the Schiff family, (a descendant of both Rothschild and Schiff, Jacob Schiff, who would be born in this house, would, some 128 years later, be instrumental in the setting up of the Federal Reserve).
1787
Colonial leaders assemble in Philadelphia to replace the Articles of Confederation with the Constitution. Governor Morris headed the final draft of the Constitution and he knew the motivation of the bankers well as he had once worked for them. Governor Morris along with his former boss Robert Morris, and Alexander Hamilton had presented the original plan for the Bank of North America to the Continental Congress, in the final year of the Revolution.
Fortunately Governor Morris by this time had discovered his conscience, defected from Robert Morris, and in a letter to James Madison dated July 2nd of this year he stated,
“The rich will strive to establish their dominion and enslave the rest. They always did. They always will … They will have the same effect here as elsewhere, if we do not, by the power of government, keep them in their proper spheres.”
James Madison was opposed to a privately owned central bank after seeing the exploitation of the people by the Bank of England. Thomas Jefferson was also against it, and Jefferson later made the following statement,
“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and the corporations which grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered.”
Sadly the words of wisdom of Governor Morris and Thomas Jefferson fell on deaf ears. Alexander Hamilton, Robert Morris and Thomas Willing, convinced the the bulk of the delegates to this Constitutional convention, not to give Congress the power to issue paper money.
They were aware that most of these delegates were still reeling from the wild inflation of the paper money during the revolution. These delegates also had short memories and didn’t remember how well Colonial Scrip had worked before the war, or Benjamin Franklin’s words of wisdom in 1764.
As a result the Constitution was silent on the issue of paper money by the Government for the citizens, leaving a wide open door for money changers in the future.
1790
Less than 3 years after the Constitution had been signed, the newly appointed First Secretary of the Treasury, Alexander Hamilton, proposed a bill to the Congress calling for a new privately-owned central bank. Interestingly, Alexander Hamilton’s first job after graduating from law school in 1782 was as an aide to Robert Morris, a man who he had written to in 1781 stating, “a national debt, if it is not excessive, will be to us a national blessing.”
1791
The three main players behind the Bank Of North America were: Robert Morris; Alexander Hamilton; and the Bank’s President, Thomas Willing. These men did not give up and Alexander Hamilton, now Secretary of the Treasury, a man who described Robert Morris as his, “mentor,” managed to get a new privately owned central bank through the new Congress.
This new bank was called the “First Bank of the United States,” and was exactly the same as the Bank of North America. Robert Morris controlled it, Thomas Willing was the Bank’s President, only the name had changed.
This bank came into being after a year of intense debate and was given a 20 year charter. It was given a monopoly on printing United States currency even though 80% of it’s stock was held by private investors. The other 20% was purchased by the United States government, but this was not to give it a piece if the action, but to provide the capital for the private investors to purchase the other 80%.
As with the Bank of England and the old Bank of North America, these private investors never paid the full agreed amount for their shares. What happened was through the fraudulent system of fractional reserve banking, the government’s 20% stake which was $2,000,000 in cash, was used to make loans to its private investors to purchase the other 80% stake, £8,000,000, for this risk-free investment.
Again like the Bank of England and the old Bank of North America, the name, “First Bank of the United States,” was deliberately chosen to hide from the common people the fact that it was privately owned. The names of the investors in this bank were never revealed, although it is now widely believed that the Rothschilds were behind it.
Interestingly in 1790 when Alexander Hamilton proposed this bank in Congress, Mayer Amschel Rothschild made the following statement from his bank in Frankfurt, Germany,
“Let me issue and control a nation’s money and I care not who writes the laws.”
1796
The First Bank of the United States has been controlling the American money supply for 5 years. During this time the American Government has borrowed $8,200,000 from this Central Bank, and prices in the country have increased by 72%. In relation to this, Thomas Jefferson, then-Secretary of State stated,
“I wish it were possible to obtain a single amendment to our constitution taking from the Federal Government their power of borrowing.”
1798
Mayer Amschel Rothschild sends his son, Nathan, at the age of 21, to England with a sum of money equivalent to £20,000, to set up money changers there.