There is a reason DB After Thoughts runs longer than the interview: not much in the interview worth examining.

Nice to hear someone speaking sensibilities... old news to some of us but there are always those that go to the races hoping for spectacular crashes.

She points out that this has been going on since 1977. This proves planned assisted nationcide.

She points out that the banks used to loan on the hopes of bettering the communities by increasing business activity and employment. The companies of the time also felt a responsibility to the communities.

These days it's sheer greed. Production is shipped off to the lowest denominator country,,, banksters take money right out of customers accounts... it's a regular free for all and responsibility to the communities??? Well, that has boiled down to a United Way drive once a year.

Her disagreement with Ellen Brown is justified but both are sharp ladies.

Nice interview.

One of the most important DB interviews by far. Well done sirs!

Years ago there was a famous banker named Carlo Ponzi. People would give him money and he would return that and a good profit, perhaps too good a profit. What he was doing, of course, was paying his first investors money he stole from suckers who got in at the back of the line.
Banks lent out money they said they had, based on 'toxic derivatives,' and made huge profits on the interest they got when people paid back the money that actually never existed in the first place. In certain circles this is known as an 'air deal'. If you wonder how the '1%' made its billions (trillions), they did it the old fashioned way. They stole it. 'Toxic' is a euphemism for 'counterfeit.' A 'toxic derivative' is a 'thing' a bank claims it has that is worth something when, in actuality, it is nothing at all. A derivative has no money behind it, no company that makes things, no gold or silver, not even vacant land on one of the moons of Saturn.

Nobody believed that every major bank in America would lie about something this simple or be allowed to commit such brazen crimes.

After all, were there laws and regulations? Oh, you say such regulations are 'socialism' and restrict the free use of capital.(So now Ye have what Ye want. Alex Jones sees everything as socialist, marxist or collectivism. Good luck)

So the banks invented $500 trillion dollars and, finally, when the money coming in wasn't enough to hide the fact that the banks assets were imaginary, it all exploded.
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An examination of the history of corporate personhood in the United States is instructive on this point. Even with a cursory review, you soon realize that the courts and the business community have strayed far from the original intent of the Founding Fathers in establishing corporate charters.
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Contrary to the myths to which some subscribe, including many libertarians, the evolution of capitalism out of the old feudal order was not one where liberty triumphed over privilege, but one where privilege asserted itself in newer and more sophisticated forms.
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Putin has already announced significant liberalization of the election laws, among them the proposition to further lower the threshold for registering parties with nationwide status. (We will probably never see a similar liberalization of the corresponding US laws, a country where two parties share the eternal monopoly to power. Similar business monopolies are broken up by the anti-trust laws, why don't apply the same principle to these parties that steal the vote in the USA). Thanks to the political reforms that the Government has announced all those competing opposition leaders will soon have a chance to form their own parties by way of collecting the signature from 500 friends instead of the 40,000 needed today. I admit that this is a display of Putin's political genius. Then each of the much touted 'opposition leaders' will have the chance to form their own private pocket parties. Let them compete!

I predict that Putin will go down in history as one of the greatest leaders of all countries and all times.
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At the beginning of May, a few days after the communist revolution had been terminated on May 1, 1919 by the Bavarian Freikorps, Hitler was summoned as a member of the 2nd Infantry Regiment to attend a course on political instruction. The purpose of this course of lectures was to provide the soldiers with a background of politics, which would enable them to monitor the many revolutionary and political movements present in Munich at that time.

One of the lecturers was a former construction engineer turned economist, Dr Gottfried Feder (1881-1941).(1) His first lecture was entitled 'The Abolition of the Interest-Servitude'. Hitler was enthralled by what he heard, and this was to be a turning point in his political career.
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As always. Decentralization and diverzification is real point of state owned banks. It is paradox, but to achieve free market we must break monopoly thru state owned banx and enterprises- like insurance. Free hands aint worx at all. Command and control worx. Paradox numero due is, that majority of world folx wants socialism, means regulations and taxations of rich, and nazism which means abolishion of interest servitude. Socialists and nazis became anemies of bankers, so this is reason of so many fairy tales behind.

Argentina: We are paying off 'historic debts, generated over decades of abandonment, mistakes, bad policies, or also of foreign interference so that Argentina would not have nuclear development. We have restored the will and the decision that the country should govern itself.' (Message is clear.National socialism. I bet that Putin, Kirchner,Viktor Orban learned history without fairy tales).

AW: We are not sure, however, that the kinds of free-societies that we (along with many others) advocate will come about because people simply will them into existence. More and more, we are convinced that the current trends will have to play themselves out at least to some degree. For this reason, we do not advocate using the current system to CURE the current system, as more and more are arguing.

(This is my post from another stream it seems relevant here):

I have no ideological preference for a type authority/rule, it's for people to decide. Having said that, I would like to know if those who wish for no government or smaller government think it's productive to wait for a sweeping change of rule/structure, or if it's is better to at least attempt to make the best of the current system by engaging government policy? Therefore, at least attempting to have a positive influence over it, until a smaller government arrives, if indeed it will.

And no, I do not believe politicians are 'good' or that they work for the common good but that's an issue beyond the structure of rule and is to do with the general moral tone of society, its principles and Money Power control.

*Any* authority can be unjust and use force and coercion to achieve its ends. However, governments by nature have greater scale and scalability, which is a problem *if* the people in control are malevolent.

What constitutes force? If people wish for governance in its current guise then are they really subject to force (excluding war, rather referring to general governance)?

If 'force' is wrong then is it right to impose or to endeavour to impose no government? For example, if the populace were asked if they wanted regulations and the police most would say: yes. Are they then really subject to force? What if people want government, what if trends are past the point of no return and people simply will not go back to regional/tribal-type rule)?

Coming to interest, it has been demonstrated over and over again, without rebuttal that it does indeed transfer the majority of the wealth into the hands of a few (as far as I'm concerned those who defend interest defend Money Power). Government allows debt at the point of printing and lending. So shall we twiddle our thumbs until there is no government or smaller government before it is lobbied against? If libertarians are anti-debt at the point of printing then why not so later at lending? If it's a free market idea of 'let the market decide' then surely libertarians should let the market decide on a debt based currency too and not advise against it? This is the trouble, you cannot have a just society without principles. It would never be free, might would always be right.

Should we not attempt to engage with the world we have now? I do not support Ron Paul but he is a libertarian that wishes to engage with the current political system does that make him a statist or a proponent of the use of force?

In our view, people should try to DROP OUT of the current system to the best of their abilities.

'DROP OUT' sounds alright but how and to what extent?

I began reading this interview with a bit of skepticism. After all, North Dakota isn't exactly a thriving economic powerhouse. It has a tiny population and young people leave the State in droves to find work. Perhaps it is the lure of easy unsustainable Fed Gov controlled money and entitlement?

I turned the corner with this statement by Ms. Barnewall,

'I agree with a lot of what von Mises says but I disagree somewhat on the gold/silver standard because I believe we need commodities as a whole to back our currency. In other words, I believe gold, silver, natural gas, coal, timber, fishing, etc., all of the natural resources of any state, should be able to back a state currency, for example. In my opinion, all wealth comes from the earth.'

I believe it is essential that people understand that all wealth comes from the earth. And further, it is multiplied and delivered by human effort. Economy is the division of labor by free association and cooperation to this end. Currency then, if not to defraud, has to be asset backed.

I would like to read her trilogy, and from what I have learned so far, can support her ideas.

She mentioned Wanta. I know it is a big story, but don't know the story or its credibility. Does anyone have reputable links to it?

I almost avoided reading this interview - another top down proposal, was my thought.

But I did read it, and am glad I did. While philosophically I oppose state intervention in all of its forms, I understand the significant gains to be made by any form of decentralization. Inherently, decentralization offers more choice and decentralization is the direction opposite to one world government.


So thanks once again to DB for bringing this interview.

Finally a solution a that make obvious sense. Good for this principled lady to state the facts. We need more people of her qualifications to stand up and yell, DON'T TAKE THIS ANYMORE.

Good work DB another interesting person fighting for freedom.

MMB: "I don't believe in a lot of regulation but I do believe you've got to have the proper structure in place to minimize the conflicts of interest involving greed and corruption"

REGULATION IS FUTILE:

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@DB: Thanks for bringing MMB to our attention. She was previously unknown to me, but, appears to be "one of the good gals".

Of course, State Banking is just a pit stop on the road to returning to "my word is MY bond, bank of ME", a devolution of power back to the individual, from whence it comes and, belongs when we finally insist that:

Law impartially deal with ALL who initiate aggression (predators).

Law impartially hold ALL to the contracts they agree to, no renegging, especially politicians, oathtakers, public "servants". Lie -] banishment to political oblivian, plus pay triple reparations to victims, from resources of criminals.

Summer

I am going to avoid conversation about the pros and cons of interest today. Memehunter has absolutely destroyed the dialogue on this subject.

However I do want to address your statement:

Summer: If 'force' is wrong then is it right to impose or to endeavour to impose no government?

BM: You must see the contradication; if one sees force as wrong, one cannot use force - "impose" - to implement his desire of no force (except it is always right to use force to repel an act of aggression, of course).

One can certainly "endeavor" to do about anything - endeavor isn't force, at least how I understand your use of the term and in this context.

Summer: For example, if the populace were asked if they wanted regulations and the police most would say: yes. Are they then really subject to force?

BM: The ones who say yes and bear the burden of the cost are not subject to force, they voluntarily made the choice.

The question is protection of the minority. What if one person does not want this choice? Who protects him from force? Because he is outvoted doesn't make the subsequent theft right.

There has been enough written about how voluntary associations can accomplish much of what passes for government today - the "good" part, not the bad part.

Governing behaviour is better handled by family, church/mosque/temple, and local community than it is by passing laws criminilazing non-violent acts.

Safety and "police" type activities can be better handled by agencies currently offering insurance, etc.

Street development and maintenance can be better handled by local property developers, homeowners associations, and for-profit toll road developers.

These are a few of dozens of possible alternatives.

But these at least allow each individual the choice to participate or not.

Unless the minority of one is protected in his choice to not go along, we all live under the cloud of force - to be exercised whenever the majority (or one purportedly speaking onbehalf of the majority) desires.

The interview supports DB's primary thesis, which they took the opportunity to re-state, for newbies. What's wrong with that?

Like it, or not, the state and its supporters are legion. Is it not a good thing that some "of the reality based constitutiency" are working, from the inside? Assuming good intentions, and reason prevails, a neutered state, having to compete (or die) with the free market in the cost effective provision of goods / services is the inevitable outcome. Let statist rhetoric regarding their "neccessity" be put to the test of the "unseen hand" (collective FREE choice).

I (and statists) have zero doubts where this leads. Which is why THEY lie, manipulate and confuse fools that they themselves have created with subverted MSM and dumbed down "education".

She cites the North Dakota unemployment rate approvingly. I wonder if that has anything at all to do with the shale oil boom? Or does it have to do primarily with state banking? Food for thought, eh?

Yes, good point. I think a mandate of "full employment" like the Federal Reserves' is over reach. Why is that any of their business? When the desire to manipulate exists, naturally the high minded ideal is advertised.

Good interview, DB.

Reply from The Daily Bell

Thanks.

Where is the 'like' button? -click-

Reply from The Daily Bell

There is no like button. Only a "ratings" one.

"Hey we're going to have our own state bank." [... the states are saying to the federal government].

State chartered banks are nothing new or unique. Before the Civil War there were 950 state chartered banks. By 1880, there were 29,000 state chartered banks. They created their own "redeemable" currency or used other banks "redeemable" currency in their discounting of Real Bills.

In contrast to the tens of thousands of state chartered banks creating currency against discounted Real Bills, there were only a half dozen nationally chartered banks, authorized to receive deposits from the federal government.

"The Federal Reserve is a private corporation; it is not part of the government and it has no authority over the independent states of the United States."

Ms. McGruder-Barnwall is simply wrong on this point. Reading the Federal Reserve Act can easily verify my contention.

The original 1913 Federal Reserve Act was strongly supported and insisted upon by the states. Too many of the state chartered banks were violating their charter for creating "redeemable" currency. In particular, they used "idle" currency to speculate in real estate. This was a direct violation of the Real Bills Doctrine under which the state banks were chartered. The violations were difficult to detect until it was too late and real estate booms would end in busts, taking the productive economy down with it. This sort of rogue behavior by banks was particularly bothersome to states with banks which did not create "redeemable" currency on their own, but instead used "redeemable" currency created by banks chartered in other states to earn discounts on Real Bills.

During the late 1800s, a number of real estate boom-bust cycles caused pressure to be put on Congress to do something about rogue banking. The big money center banks, anticipating federal government restrictions on their banking behavior, tried to influence the Congress to give them an advantage in any future national legislation. The states were fully aware of this effort by the money center banks, and they fought it.

When the FRA finally passed in December of 1913, it reflected the desires of the states, NOT the desires of the money center banks.

The Federal Reserve System which emerged from the 1913 FRA was not one private corporation, it was twelve private, regional reserve bank associations, each chartered and franchised to create a national currency under their own seal. It was the "redeemable" Federal Reserve Note.

These twelve private reserve banking associations, each separately called a "Federal Reserve Bank", and collectively known as the Federal Reserve System, could create FRNs only against the value of un-matured Bills of Exchange (Real Bills) and gold held by their member banks. Their currency creation and currency circulation was overseen by the Board of Directors of the Federal Reserve System, an oversight arm established by, and answerable to the Congress. The intent of the 1913 FRA reflected the desires of the states to check the inflation of currency, brought on by rogue use of "idle" currency for real estate speculation. That was the reason for establishing a national currency supervised by the U.S. Congress.

For the purpose of gold reserves, which banks had to have on hand by requirement of the 1913 FRA, U.S. Treasury bonds (gold bonds) were quite acceptable. These gold bonds, however were non-marketable. To sell these bonds in secondary markets was expressly prohibited by the 1913 FRA.

In the early 1920s, the FRB NY, under its Governor Benjamin Strong, formed an Open-Market Investment Committee for the purpose of acquiring UST gold bonds, and to market them to the other eleven regional, private reserve bank associations for which these "Federal Reserve Banks" paid with "idle" currency. This illegal secondary marketing of UST bonds, conducted by the OIC at the FRB NY in the early 1920s, amounted to running a "central bank" for the purpose of monitizing U.S. government debt, and to deliberately inflate the currency supply.

The downfall caused by the OMOs of the OIC at the FRB NY was of course the "redemption" requirement printed on the face of the FRN. When people caught on to what OMOs were doing to the currency supply, the Florida real estate bubble burst, the stock market crashed, and banks refused, or were unable to redeem FRNs for gold. Subsequently, the gold standard was officially abandoned in September of 1931.

The National Banking Act of 1935 gutted the original FRA of 1913. It preserved the name (with subtle modification) to fool the public. The Banking Act of 1935 legalized the kind of debt monitization which the OIC at the FRB NY practiced illegally, starting in the early 1920s.

Here is where Ms. McGruder-Barnwell is wrong. Today's "Fed" is the "Board of Governors of the Federal Reserve" and its "Federal Open Market Committee" in Washington, DC and twelve Federal Reserve "District" Banks. This is what is known today as the "Federal Reserve" or "Fed". The term "Federal Reserve System" was dropped. What is known as the "Fed" today is clearly and unequivocably a U.S. government agency, albeit it calls itself "independent".

The American banking system itself is dependent on the "Fed" to create currency, which it then circulates through its local or branch offices. How this is done, and how our politics is shaped by this dependency of the banks on Fed policy is a subject matter all its own.

The point is, that Ms. McGruder-Barnwell's ideas about banking deal with debt and credit, and not with "Money" or "redeemable" currency. "Banking" is the creation of "redeemable" currency. Moving around monetized debt is NOT banking. At best it can be called "debt obligation" investing, but that is an oximoron.

When everything is said and done, "banking" and "legal tender" currency are incompatable terms. Cite North Dakota banks, cite "private" banking, cite any bankig at all, if "legal tender" protected currency is involved, it isn't "banking". At best, these examples point to a more efficient application and circulation of debt monitized "legal tender" FRNs, but it is NOT "banking".

The FOMC of the Fed creates "irredeemable" currency by monetizing debt. The American "banking" system, which is made up of state chartered banks as well as of federal charterd banks, merely circulates these "irredeemable", "legal tender" FRNs. How these FRNs are made to circulate is a subject of its own. Except, to say that "fractional reserve banking" has little to do with "reserve requirements" set by the "Fed".

The solution to the mess created by the National Banking Act of 1935, does in fact lie with the states.

However, what were the states thinking when they ratified the 16th Amendment, which today secures the debt obligations of the U.S. Treasury... ???

What were the states thinking when they ratified the 17th Amendment and thereby resigned their voice in the U.S. Congress... ???

States since the creation of the American Republic fought against the establishment of a central bank issuing debt monetized currency. Could it not have been foreseen what problems the 16th and 17th Amendments would eventually present to the states... ???

So what now... ??? Should the states go to the federal government and say, "Hey we're going to have our own state bank." It amounts to begging to get back power which the states readily gave up in 1913.

Isn't it clear that the FRA of 1913 only passed after these two amendments were ratified... ??? The money center banks supportetd the ratification of the 16th and 17th Amendments, because they failed to get their way in the national banking legislation. It proved the real intention of these banks, but it also proves that the 1913 FRA was not favored by them. Their supporters in Congress merely withdrew their opposition to passage of the FRA after the 16th and 17th were ratified.

Hi Bionic Mosquito,

Thanks for your response. In essence I don't disagree with your views.

Summer: If 'force' is wrong then is it right to impose or to endeavour to impose no government?

BM: You must see the contradication; if one sees force as wrong, one cannot use force - "impose" - to implement his desire of no force (except it is always right to use force to repel an act of aggression, of course).

Well, my point was the absence of something can be an imposition of an undesirable state of affairs for some party or another i.e. if a libertarian became president an dissolved all government and police this would still be imposing a certain environment.

My main points were: " This is the trouble, you cannot have a just society without principles. It would never be free, might would always be right.

Should we not attempt to engage with the world we have now? I do not support Ron Paul but he is a libertarian that wishes to engage with the current political system does that make him a statist or a proponent of the use of force?"

Btw, what do you think of secularism in its purer forms viz., minority rights and justice, especially regarding plural legal systems?

Hi Ingo,
Is it your opinion that there was no malevolent or at least an opportunistic intent with Aldrich and the boys in 1913? That the evil machinations arrived with Strong.

Are you saying we briefly had the best of two worlds between 1913 and 1935? But look at the instability during this period. I am an old fashioned conservative. I like stability.

Fine interview, D-B-. I had not heard of her (I do not get out much), and enjoyed reading her thoughts.

Good of you to be open minded about folks who can be useful allies in the short/intermediate-term, though they differ from your long-range ideal.

"Is it your opinion that there was no malevolent or at least an opportunistic intent with Aldrich and the boys in 1913? That the evil machinations arrived with Strong."

Oh, not at all. I think the Griffin book is exactly correct in describing the scheming by the NY bankers culminating in their meeting on Jekyll Island. They knew that federal legislation was demanded by the states to reign in the behavior of the money center banks. Whatever emerged in this federal legislation, the money center banks wanted it to favor them.

Their man in the U.S. Congress to corral support for legislation that favored the big NY banks was the Republican leader of the U.S. Senate, Senator Aldrich of Rhode Island.

Despite Aldrich's effort have the franchise to create a national currency awarded to the NY banking reserve association, the states wouldn't hear of any of such legislation.

When the NY bankers realized that their efforts to gain sole control over the creation of the national currency by legislation was never going to happen, they changed their tactics. Senator Aldrich changed his opposition to the proposal of the 16th and 17th Amendments in the U.S. Senate and came out for their ratification. The NY banks gave financial support to the "Progressive Movement" which demanded ratification of the proposed amendments.

It is my conclusion, that at the point when Aldrich and the big NY banks started to support the demands by the "Progressive Movement" for greater wealth distribution (Income Tax Amendment) and to stamp out corruption by state legislators in selecting U.S. Senators (Popular election of U.S. Senators), the money center banks had concluded their plan for future action. It was a mere matter of time, and a matter of opportunity before they would act on their plan to "elastizise" the currency supply.

While Aldrich could not persuade enough legislators to pass legislation favorable to the NY banks, he did have enough support to hold off legislation which was unfavorable to the big banks. Anly after the 16th Amendment in February of 1913 and the 17th Amendment in April of 1913 were ratified by the states, did Aldrich and his supporters drop their demand for changes and let the Federal Reserve Act pass in December of 1913. The final version of the Act favored the interests of the states. It did NOT favor the interests of the NY banks.

However, the states were completely unaware that they had shut themselves in the foot with the ratification of the 16th and 17th Amendments. It never dawned on them that the two amendments would make it possible for the NY banks to establish a central bank without their concurrence. (The politics involved in the ratification of the 16th and 17th is very interesting. Where are the gradute students who could do research in this area... ???)

When in the early 1920s, the country experienced an economic down turn as result of WW I, Benjamin Strong saw his chance to conduct OMOs and liquify the currency supply to help weather the economic downturn. It was successful. The politicians loved it, because of favorable voter reaction. Consequently, the FRB NY kept selling UST bonds in secondary markets and the country was off to the "Roaring Twenties".

The direct answer to your question is, "No, the evil machination did not arrive with Strong. The evil machination was present at the Jekyll Island meeting, it was present with the support of the ratification of the 16th and 17th Amendments, and the illegal act by the OIC of the FRB NY under Benjamin Strong was only the enactment of the evil intent which had existed with the money center banks for decades. However, I see this "evil intent" less as conspiratorial than as an act which derives from human nature.

"Are you saying we briefly had the best of two worlds between 1913 and 1935? But look at the instability during this period. I am an old fashioned conservative. I like stability."

I am not saying that at all. What I am saying is that the Federal Reserve Act of 1913 as far as legislation to solve a problem was concern, was in my opinion excellent legislation. It installed creation of a national currency under the RBD by private banks in issuing a federal franchise to their twelve regional bank reserve associations. These reserve banking association, aka as Federal Reserve Banks, created "redeemable" FRNs for their member banks based on the value of un-matured Real Bills and gold these banks held. Nothing else was eligible to be monitized under the original FRA. It worked just fine.

What didn't work was the oversight body of the Congress in the form of the Board of Directors of the Federal Reserve System. These were federal bureaucrats appointed and paid by the U.S. Congress. They were not given the respect for the kind of job they had to perform. They were shunted off into a facility with no windows at all. Their pay when compared to the pay of any of the bankers with whom they had to deal, was down right miniscule. To that add the intimidating figure of Benjamin Strong, as Governor of the FRB NY, which in size of deposits was twice as large as the next largest reserve bank in Chicago, and the Board of Director of the Federal Reserve System was essentially neutered by the rough shut treatment from Strong and the FRB NY. Things were never the same after the OIC at the FRB NY started illegal OMOs in the early 1920s while the Board of Directors failed to utter a peep.

I am quite sympathetic to you conservative sentiments. I like stability too. However, when people don't know the first thing about banking or the RBD, when politicians pander to the basic human instincts of voters, the common good will always be hurt.

Jefferson repeatedly made the point that the Republic could only survive with an educated electorate. His words "To be ignorant and free, is something that never was and never will be". Nothing could be more true today.