Almost immediately after the second Constitution was ratified -- the first was ratified in 1781 -- Alexander Hamilton promoted the Bank of the United States as a central bank with control from a national level. This was the second great experiment in monetary sovereignty in the history of the United States. The first was the fiat money system of the revolution. It lasted for 20 years: 1791-1811. The charter was not renewed in 1811. In 1816, the third experiment began, the Second Bank of the United States. That lasted until 1836, when President Jackson saw to it that the federal transfer of monetary sovereignty to a private banking organization ended. This great fight politically had taken place in 1832, and Jackson defeated the forces of Henry Clay when he vetoed the premature re-chartering of the second Bank of the United States. Not until 1913, when a German immigrant named Paul Warburg joined with the banking forces of the Morgan interests and the Rockefeller interests to get the Federal Reserve chartered did this country suffer from national monetary sovereignty. It was the greatest period of economic growth in American history. It was the greatest period of economic liberty in history. The heart, mind, and soul of this liberty were tied to this central fact: there was no national monetary sovereignty in the United States. There were banks. There was no central bank. There were gold and silver coins issued by the mint, but other coins could be used in exchange.An article well worth your time.
This was the era of the international gold standard. There was no international monetary sovereignty.
There was state monetary sovereignty, which was a huge mistake. If there had been no state monetary sovereignty, then we would have had a true free market in money, which is what Ludwig von Mises recommended in 1912 in his classic book, The Theory of Money and Credit. His great opponent was Irving Fisher, economist at Yale, who favored a fiat national currency. Fisher was a great defender of central banking. He won the debate, but he never got his stated goal: 100% reserve commercial banking. He was the academic shill for Warburg, the Rockefellers, and Morgan.
In 1913, in late December, the United States had federal monetary sovereignty shoved down its throat: the Federal Reserve System. Americans have never had liberty again in the field of money. The reason why is clear: federal monetary sovereignty.
Wednesday, June 25, 2014
Gary North reports:
Posted by Steve Bartin at 8:53 AM