Governments And
The Central Banking System
A Marriage Between Politics And Mammon
The Unholy Alliance - Part 2

By Nadir Martello

Nowadays, marriage is not very popular. Nonetheless, since the beginning of the last century a new phenomenon occurred in our western civilization, namely an 'indissoluble marriage' between governments and Mammon. We will be celebrating the one hundredth anniversary of this 'unholy union' in nine years time, in 2013.
Celebration or mourning day, ninety-one years of marriage is a lifetime indeed. A happy event is the twenty-five year silver anniversary; even happier the fifty years golden anniversary; happier still seventy-five diamond. Ninety-one years then is a diamond plus sixteen years on top, giving to the partners vintage and prestige - a real super-duper jewel.
Nobody can argue that this hasn't been a smashing success for the establishment of course, in a society where divorce is so prevalent. Even 'de facto' couples rarely reach an average of fifteen or twenty years together.
Here we have, concealed from the public eye, governments and the central banking industry, which stipulated this unholy union, with the sole aim of empowering themselves, in particular through the creation of fiat money out of thin air.
Here is how fiat money is created:
"Under a fractional-reserve banking system, a bank can create new money merely by issuing a loan. The amount it creates is limited by the reserve ratio or "fraction" it is required to maintain to cover its cash-flow needs. If the reserve ratio is 10% then each $10 it lends includes $9 that never existed before. A commercial bank, therefore, can create a sizable amount of money merely by making loans. But, once the bank is "loaned up," that is to say, once it has already loaned $9 for every $1 it holds in reserve, it must stop and wait for some of the old loans to be paid back before it can issue new ones. The only way to expand that process is to make the reserve larger. That can be accomplished in one of four ways: (1) attract more deposits, (2) use some of the bank's profits, (3) sell additional stock to investors, or (4) borrow from the Fed." (G. Edward Griffin, The Creature from Jekyll Island", page 478).
An example of this 'unholy alliance' is the US government and the Federal Reserve System [Fed]. This bank is as Federal as a wolf is a sheep. The word Federal is misleading, for in reality it is a consortium of a few private banks' owners [a corporate] whose loyalty first and foremost is to New York's Wall Street.
The sad story of the Fed started in December 22, 1913, when "The Federal Reserve Act was released from the joint House and Senate conference committee just as Congress was preoccupied with departure for the Christmas recess and in no mood for debate. It quickly passed by a vote of 282 to 60 in the House and 43 to 23 in the Senate. The President (Woodrow Wilson) signed it into law the next day." [G. Edward Griffin, page 468]
To make a long story short, the marriage between governments and the central banking system started about 91 years ago [even though, the Bank of England was created in 1649, and the Fed is a carbon copy]; and though this may seem strange for the common people to picture, the partners never come into conflict or 'divorce', because between them there is a hidden agreement that keeps a sort of 'balance of power', which is expressed in monetary parlance by G. Edward Griffin:
"The purchase of securities by the Fed (with checks that have no money to back them) creates money; the sale of those securities extinguishes money. Although the Fed is authorized to buy and sell almost any kind of security that exists in the world, it is obligated to show preference for bonds and notes of federal governments. That is the way the monetary scientists discharge the commitment to create money for their partners, the political scientists. Without that service, the partnership would dissolve, and Congress would abolish the Fed [emphasis added]." [Page 477]
In other words, politicians and the money-masters came to an accord behind closed doors whispering words such as:
"We [the bankers] are the makers of monies, the magicians of finance, the experts in economics who, by the 'statutory' monopoly of money creation you have given us, will acquiesce for you to exercise the political power over your subjects. In addition, as a bonus, you will be given a share of the profits for yourselves, on condition you follow our directives unquestioningly.
"You will stay in power long enough to accomplish our wishes, i.e., in order to serve our agenda. Nonetheless, you will be bailing out us whenever we fail in our central banking enterprise. As we know, money is based on debt. Thus, do not even think of paying your government debt [principal]; but only the interest, otherwise, by paying the principal, you would destroy "reserves" in the bank and, consequently, there would not be a cent in circulation.
Edward Griffin states: "Surprising as it may be on the eve of the depression, America was getting out of debt. As consequence, there were few government bonds for the Fed to buy. Without government bonds, the open-market engine was constantly out of gas." [Page 479].
"Money has to be circulated by trade of goods & services for the 'free market'; because money is like blood in a body - without it, it dies. We know that money has no intrinsic value, because it is not backed by anything of real value [such as silver or gold or other commodities], only your Treasury signature and stamp for the issue of coins and banknotes, which gives them the title of 'legal tender'. However, between us "partners", we know that inflation is largely the effect of fiat money, i.e., imbalance between the supply of money and the supply of goods and services.
"Through our loans to you, we'll take care of your money supply. That is our part. You make sure, though, that your subjects never discover that they are paying, through indirect and direct taxes, the interest on the principal, [which will never be paid] and the hidden tax of INFLATION, i.e., the loss of the purchasing power of money.
"You and we are together in this venture - you cannot exercise power without us; on the other hand, we cannot function without you. -You cannot exercise power without us, because you need us, the international bankers, to finance you, for all works, or any sort of expenses you might bring upon yourself during the time of your exercise of power over your subjects. -On the other hand, we cannot function without you, because you are our facade, for people to look at and feel proud. As our facade, your function is first to hide us from them. They do not know who is behind the "curtain". You govern them; but we dictate the rules. Let them think that you are at their service, and that their money is in safe hands with us, for we bankers, as public institutions, are neutral, are we not?
Once more Edward Griffin writes:
'Agents Of Higher Power When reviewing this aspect of the Fed's history, questions arise about the patriotic loyalty of men like Benjamin Strong. How is it possible for a man who enjoys the best that his nation can offer - security, wealth, prestige - to conspire to plunder his fellow citizens in order to assist politicians of other governments to continue plundering theirs? .. International money managers may be citizens of a particular country but, to many of them, that is a meaningless accident of birth. They consider themselves to be citizens of the world first. They speak of affection for all mankind, but their highest loyalty is to themselves and their profession.' [Pages 474-475.]
People do not know that the cause for inflation originated from fractional reserve banking system, which, plausibly, is our own creation. Nor do they know, and we must keep them ignorant, that you governments are the biggest spenders and squanderers of revenue; for we are just the "financial architects", the power behind the throne. We maintain the money-supply-machine - the central banking system - "for the good of the country".
As I outlined, this "marriage" between government and the central banking system, seems unbreakable - a water-tight union between two "partners" - and unlike other unions where divorce is a way out, is most unlikely to ever be torn asunder.
The reason they will never split is that there is too much at stake. If one of the "partners" decides to quit, say the politicians, a total political and social ruin will occur, as well as the collapse of country's economy. On the other hand, for the mammonites, it goes without saying that they will never quit, because in doing so they would lose not only their livelihood, but it would be their financial suicide; consequently, the end of their nefarious agenda.
Last but not least, if the product of this "marriage" between government and the mammonites is more centralization of power in fewer hands, is it not time to wake up and put a stop to it? Who wants to live with this "Doomsday Mechanism"?
"Unfortunately, the locomotive is running in the opposite direction. The size of government is growing larger, not smaller. There are more people working for government than for all manufacturing companies in the private sector. There are more bank regulators than bankers, more farm-bureau workers than farmers, more welfare administrators than recipients. There are more citizens receiving government checks than there are paying income taxes.
The Doomsday mechanism is also operating within government itself. By 1992, more than half of all federal outlays went for what are called entitlements. Those are expenses - such as Medicare, Social Security, and government retirement programs - which are based on promises of future payments. Many of them are contractual obligations, and millions of people depend on them." [Page 509]
Two last thoughts:
A banker is someone who lends you an umbrella when the sun is shining, and who asks for it back when it starts to rain.
A Dutchman was explaining the red, white and blue Netherlands flag to an American. "Our flag is symbolic of our taxes. We get red when we talk about them, white when we get our tax bills, and blue after we pay them." The American nodded. "It's the same in the USA only we see stars too!"
For 'Part One' see:
Governments And The Central Banking System By Design Or Coincidence
Also see: "Isn't the American Dollar the reserve currency of choice worldwide"



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