From: Wayne Q Jones <qjones@infi.net>
Date: Mon, 2 May 94 20:24:16 PDT
To: perry@imsi.com
Subject: Re: The American money capture
In-Reply-To: <9405021903.AA26802@snark.imsi.com>
Message-ID: <Pine.3.89.9405022309.A25680-0100000@larry>
MIME-Version: 1.0
Content-Type: text/plain


Fed is not a bank but a conglomerate of privately owned banks. The system 
is a quasi-govt entity .

On Mon, 2 May 1994, Perry E. Metzger wrote:

> 
> None of this is a cypherpunk topic and I don't intend to post after
> this on the topic.
> 
> werner@mc.ab.com says:
> > On this subject (really from the original post about money), I have several
> > times tried to convince people that the Federal Reserve Bank is a private
> > deal.  I don't know where I got this impression, but no one will believe
> > me.
> 
> Thats because it isn't true.
> 
> > Are there some conspicuous facts that I could quote in support of this
> > position?
> 
> No.
> 
> > Or, perhaps, an easily obtained and authoritative document which
> > explains just what the heck the Fed really is?
> 
> The Fed is pretty easy to understand. Although its set up to be
> quasi-independant, it more or less the government body that regulates
> the banking industry and controls the money supply. It does this
> by setting the discount rate (fairly small importance), by open-market
> purchases of treasury securities, by making deposits in member banks,
> and by altering the reserve requirements of U.S. banks. The Fed also
> is supposed to act as "lender of last resort" in order to stop banking
> panics by loaning money in extreme situtations to member banks.
> 
> Technically, its not part of the government the way Amtrak, the
> Resolution Trust Company, and other quasi-independant bodies aren't
> part of the government. However, this is largely just an illusion. Its
> as much a part of the government as the post office.
> 
> Its just a central bank, like every other central bank in most
> respects.
> 
> Central banks are very bad things in my opinion, however, they aren't
> some evil conspiracy of the Illuminati, conspiring in the back room to
> take over the world. The Fed earns no "profits". It has no
> "shareholders".  Its not a "bank" in the conventional sense.
> 
> > I know the head is apppointed by the US gov, but my impression was that the
> > rest of it was just a consortium of bankers to whom the national debt is
> > owed.
> 
> The national debt isn't owed to "bankers". Its owed to the holders of
> U.S. government bonds. This includes everyone who's ever bought a
> savings bond, lots of individuals, pension plans, money market funds,
> insurance companies, corporations, banks, and lots of others.
> 
> Besides, if the debt was owed to "bankers", that would just be
> shorthand for saying that the beneficial owner of the debt securities
> would be the depositors of the bank, meaning the public at large.
> 
> 
> Perry

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