"The art and mystery of banks... is established on the principle that 'private debts are a public blessing.' That the evidences of those private debts, called bank notes, become active capital, and aliment the whole commerce, manufactures, and agriculture of the United States. Here are a set of people, for instance, who have bestowed on us the great blessing of running in our debt about two hundred millions of dollars, without our knowing who they are, where they are, or what property they have to pay this debt when called on."

"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs."

"I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale."

"Everything predicted by the enemies of banks, in the beginning, is now coming to pass. We are to be ruined now by the deluge of bank paper. It is cruel that such revolutions in private fortunes should be at the mercy of avaricious adventurers, who, instead of employing their capital, if any they have, in manufactures, commerce, and other useful pursuits, make it an instrument to burden all the interchanges of property with their swindling profits, profits which are the price of no useful industry of theirs."

"The treasury, lacking confidence in the country, delivered itself bound hand and foot to bold and bankrupt adventurers and bankers pretending to have money, whom it could have crushed at any moment…These jugglers were at the feet of government. For it was not, any confidence in their frothy bubbles, but the lack of all other money, which induced…people to take their paper"

"I own it to be my opinion, that good will arise from the destruction of our credit. I see nothing else which can restrain our disposition to luxury, and to the change of those manners which alone can preserve republican government. As it is impossible to prevent credit, the best way would be to cure its ill effects by giving an instantaneous recovery to the creditor. This would be reducing purchases on credit to purchases for ready money. A man would then see a prison painted on everything he wished, but had not ready money to pay for."

"If the debt which the banking companies owe be a blessing to anybody, it is to themselves alone, who are realizing a solid interest of eight or ten per cent on it. As to the public, these companies have banished all our gold and silver medium, which, before their institution, we had without interest, which never could have perished in our hands, and would have been our salvation now in the hour of war; instead of which they have given us two hundred million of froth and bubble, on which we are to pay them heavy interest, until it shall vanish into air... We are warranted, then, in affirming that this parody on the principle of 'a public debt being a public blessing,' and its mutation into the blessing of private instead of public debts, is as ridiculous as the original principle itself. In both cases, the truth is, that capital may be produced by industry, and accumulated by economy; but jugglers only will propose to create it by legerdemain tricks with paper."

"The Bank of the United States is one of the most deadly hostilities existing, against the principles and form of our Constitution. An institution like this, penetrating by its branches every part of the Union, acting by command and in phalanx, may, in a critical moment, upset the government. I deem no government safe which is under the vassalage of any self-constituted authorities, or any other authority than that of the nation, or its regular functionaries. What an obstruction could not this bank of the United States, with all its branch banks, be in time of war! It might dictate to us the peace we should accept, or withdraw its aids. Ought we then to give further growth to an institution so powerful, so hostile?"




Regulating Banking Institutions



"The principle of rotation... in the body of [bank] directors... breaks in upon the espirit de corps so apt to prevail in permanent bodies; it gives a chance for the public eye penetrating into the sanctuary of those proceedings and practices, which the avarice of the directors may introduce for their personal emolument, and which the resentments of excluded directors, or the honesty of those duly admitted, might betray to the public; and it gives an opportunity at the end of the year, or at other periods, of correcting a choice, which on trial, proves to have been unfortunate."


Paper Speculation


"A spirit... of gambling in our public paper has seized on too many of our citizens, and we fear it will check our commerce, arts, manufactures, and agriculture, unless stopped."

"Our public credit is good, but the abundance of paper has produced a spirit of gambling in the funds, which has laid up our ships at the wharves as too slow instruments of profit, and has even disarmed the hand of the tailor of his needle and thimble. They say the evil will cure itself. I wish it may; but I have rarely seen a gamester cured, even by the disasters of his vocation."

The Root Of All Evil

IMF Meeting Stokes Fear of Currency War
Mil Arcega 12 October 2010

New Fears of A "Currency War"

EU, China Cannot Agree on Currency Measures
Group Calls for Agreement on Global Currencies


Fears of a global currency war have increased after the meeting of finance leaders at the International Monetary Fund in Washington last week. Talk of trade imbalances and uneven growth due to artificially low currencies has already sparked discussions about possible intervention. Analysts say it's an issue that's not likely to go away anytime soon.

As nations emerge from the global downturn, it's becoming clear that some countries are recovering faster than others.

In its most recent outlook, the International Monetary Fund says growth in developed countries will remain sluggish - even as emerging economies, especially those in Asia, are booming.


Last week, World Bank President Robert Zoellick warned that uneven growth is causing friction.

"We see this now in debates on currencies: developed countries are easing monetary policies; some developing countries are tightening in response to growth; some surplus countries are intervening to lower the value of their currencies to boost exports," he said. "And all this is causing international tensions."

The failure of finance ministers to come up with solutions last week in Washington has only deepened the divide. IMF managing director Dominique Strauss-Kahn.

"Many are talking about a currency war," he said. "Myself, I think I use this vocabulary which may be a bit too military. But it's true to say that many do consider their currency as a weapon and that's certainly not for the good of the global economy."

The US, for example, blames China's undervalued currency for contributing to the massive trade imbalance between the two.

And countries such as Japan and Brazil have threatened to devalue their currencies to gain a competitive edge in exports.

Economist Toby Nandle says it's a big problem with no easy solutions.

"This is not a problem that can be delegated to an international organization such as the IMF," he said. "It's a problem that needs to be addressed by heads of state and by finance ministers because the resolution of said problem has profound affects on different economies."

Among them, China.

Beijing has pledged greater flexibility in determining the value of the yuan. But Chinese premier Wen Jiabao says it will not happen overnight.

"Without this stability of the RMB exchange rate, there would be no stability for businesses, for employment, for our people, and also, if China has social and economic problems, it would be a disaster for the world," he said.

Experts say currency disputes have already jumped to the top of the queue as world leaders prepare for the G-20 summit in South Korea. Barring a resolution, Nandle says the warning from Brazil could become reality.

"If there is no agreement by November 12th as to the global disconnect, I think that Guido Mantego [Brazil's Finance Minister] hit the nail on the head - we have a global currency war underway," he said.

Governments can devalue their currencies in different ways - from giving their central banks the ability to set margins on exchange rates to buying up foreign currencies to lower demand for their own.

Economists say the resulting fluctuations would have serious implications for trade, causing nations to demand additional tariffs, and even blockades, against cheap imports.

Such laws would hurt trade, further delaying a global recovery.