What events happened in the usa that led to the creation of the federal reserve board? why was it created?

Question

historically, what happened in the united states prior to the creation of the federal reserve board that led to its making policy decisions about our money?

why was the federal reserve board allowed to take control of what dollars are printed and when?

is it true that the individual states should print their own money? why is that not practical?

why is the gold in fort knox? if it isn't being used to back our money, then why is it guarded so heavily? fort knox is the most guarded place in our country, but why? i could understand if money was backed by gold, but it is not. so since we can't eat gold, who cares that it's sitting in bars in fort knox?

what are the variety of events that happened in the past that led to the creation of the federal reserve board and what is the why and how of those events, i.e., how did they tie into abolishing the silver and gold standards that upheld our dollar in the past as well as that its printing was limited until the FRB took over?

Answer 1

Great Depression.

Answer 2

The Fed was launched in strictest secrecy, the bank barons drafted the bill(!), it was presented to Congress immediately and just before a holiday - political stacking.  Wilson I think was the responsible party, and he later said before he died that he had destroyed and sold out his country... strong stuff for a politician (they normally don't give a bugger for anyone but themselves, let's face it).

I don't know the entire story, this is all I need to know to realise there was something very murky and undesirable going on - an obvious conspiracy against democracy and the American people.

They were pivotal in the Wall Street Crash and Great depression, from which it took nearly 30 years to recover: effectively a huge asset grab by the bankers from ordinary Americans.  They made fortunes on WW1, printed money like crazy afterwards, driving rampant speculation, inflation and devaluation, then radically cut the money supply, causing a 'liquidity crisis' and engineering the crash.  People died and lived in penury as a result...

Do you think it's underway again?

Answer 3

No events happened to justify the fed fraud. Some greedy international elite perps wanted a way to control Americans by the short 'n curlies. It worked. They knew the wisdom of the proverb 22:7---"The rich rule over the poor, and the borrower is servant to the lender". They knew exactly what Mayer Amschel Rothschild meant by "give me control of a nation's money supply, and I care not who makes its laws."

Yep. the fed is a great scam. It continues cuz the sheeple are sleeping and cuz there are internet trolls lurking in the dark shadows waiting for every chance to pounce out and defend their loving and benevolent fed. It works cuz the fraudsters buy what they need to keep the sheeple sleeping--internet tolls, web sites, newspapers, tv, schools, professors, whatever yada yada yada. Hey---with all that coin they stole from us whats a few billion spent here and there to buy silence for the fraud. petty cash for them.

Answer 4

You need to read "The Cambridge Economic History of the United States, Vol. 2: The Long Nineteenth Century".  Many parts of that book explain the constant economic turmoil caused by an economy that had either unregulated or sporadically regulated banks.

In most basic terms, the "Long Depression" from 1873 to 1893, the panic of 1873, the panic of 1884, the panic of 1890, the panic of 1896 and the panic of 1907 all contributed to the need for a stabilizing factor to the economy.  Believe it or not, the Federal Reserve does provide some stability to the economy.  Part of the reason the Great Depression occurred was because the original federal reserve act was flawed and also because the Federal Reserve, at the time, had a laissez-faire attitude towards economic controls.

No, individual states should not print their own money.  I recommend that you take a college course on money and banking from a reputable college.  This course should explain the events leading up to the end of the gold standard which are far beyond the space allowed for Yahoo!Answers.

BTW, printing of dollars is still handled by the Bureau of Engraving and Printing which is part of the U.S. Treasury.  Coins are made at the U.S. Mint.  The Federal Reserve does handle the circulation of the printed money and control of the money supply.  Too much money in circulation and inflation goes rampant.  Too little money and the economy slows to a halt.

Answer 5

All of your questions are answered here:

http://www.publiceye.org/conspire/flaher...

Or, if you want, you can listen to the conspiracy theories promoted by people who need to make things infinitely more complicated than they are.

Answer 6

The Stock Market crash .

Answer 7

The Stock Market Crash was in 1929, and the Depressions was in the Thirties, so the Federal Reserve wasn't formed as a result.  In fact, it was the Federal Reserve, in concert with large stock traders, who caused the Crash.  Short term loans were called in, forcing speculators to sell their stocks.  At the same time, the large stock holders (the Insiders), began selling off large blocks of stocks, precipitating a panic.  As more and more people sold their stocks, the prices went down.  When the Market hit bottom, the Insiders bought back into the Market for pennies on the dollar.

The Federal Reserve was created to give control of our economy to the large international banks.  The politicians gained revenue from the inflation of our currency.  Government was the first user of this new currency, based on debt.  The result for the rest of us was inflation, which causes higher prices.

The Federal Reserve is unconstitutional.  The Constitution is very plain in charging CONGRESS with the responsibility to coin money, not create a central bank to issue debt notes.  The Constitution also says that no state shall make anything but gold and silver legal tender.  This places an obligation on the Congress to coin money out of gold and silver.

Now  you know why I refer to them as criminal politicians.  That's what they are.  They have broken the Supreme Law of the Land.

Answer 8

Well after the National bank was created and then destroyed by Alexander Hamilton (who had 3 attempts on his life during this time of Presidency) the Federal reserve was created after Amschel Rothschilde made a rumor that a bank was going out of business because of losses.  As a result of that rumor, that bank and several others closed because everyone was scared and pulled thier money out of the banks.  When that happened, to pay back thier loans to foriegn bankers, the banks had to liquidate property that had loans on them.  They had to sieze back property that was mostly paid for to pay back thier debts.  Like if you had a mortgage and you land contracted it out to someone else and then couldn't pay the land contract, you lose the house and so does the person on a land contract.  Pushing thousands of people out onto the streets and the stock market to crash.  Then the Government (who has VERY strong ties with the Rothschildes) opened the Federal reserve and then offered insurance to those who would use the bank to get rid of the fear of using banks for fear of loss of money.  Then the federal reserve told all of America to turn in it's gold so that the money could be of value, though they never used it for that.  So they robbed people of thier homes and businesses as well as for thier property since there was no compensation for the gold they turned in.  Since this has happened 2 other Presidents have tried to abolish the Federal Reserve and those 2 are Lincoln and JFK.  Go figure, the 3 Presidents who try to abolish a National or Federal Bank get assasinated or they try multiple times until they do.  Not a conspiracy though, I mean we declared Independence from the biggest imperial nation that has lasted the longest in history so far (england) but a bunch of british descendants are the Presidents as well as on the Federal Reserve board and the british own 5 out of the 6 of our tv news networks that cal "truthers" crazy.  No our country hasn't been overthrown.  I bet most of you think the civil war was because of slavery.  Well I just have to tell you to go to the Lincoln Memorial.  There are a good deal of quotes there that basically state that Lincoln's enemies wanted you to think that, you were taught that in a Federally run school system.  Who won?  Not freedom.  Abolish the Federal Reserve.

Answer 9

A full answer to your question would have to take the history of banking into account. So I'm going to focus on the events that immediately preceeded the chartering of the Federal Reserve Board of Governors.

Though the Federal Reserve was chartered in 1913, the creation of the Board of Governors was not created until the Bank Act of 1935.

The original charter of the Federal Reserve was a compromise bill of those who wanted 100% private and those who wanted a 100% public central bank. The result was privately dominated Fed branches supposedly overseen by the "Board of Directors" which was headed by the Treasury Secretary.

This organization did not work very well. The branches did not cooperate very well and resisted efforts by the Board of Directors. Each of the 12 Districts had their own monetary policy.

It came to a head with the Great Depression. The infighting of the autonomous branches on what to do next showed them to be relatively ineffectual during this national crisis.

The Bank Act of 1935 changed all that.

- The newly formed Board of Governors (a government agency) would have absolute power over monetary policy

- Branches (still considered member-owned private corporations) would retain some independence but it would be for day-to-day operations

- The charter for the Fed was changed from a somewhat lassaiz faire policy to being more active in stimulating the economy.

- Re: is it true that the individual states should print their own money? why is that not practical?

Used to be that way. Before 1900, there was over 30,000 currencies in circulation. In the Free Banking era, any bank could print currency and different states had different currency. Conversion rates were a huge problem as well as counterfeiting.

- Re: why is the gold in fort knox? if it isn't being used to back our money, then why is it guarded so heavily?

Well, it is still pretty valuable. And though it doesn't explicitly back our currency (except for $11B worth),  the fact that it is there strengthens the perception of the dollar overseas. That is, if there was some sort of economic calamity, the U.S. could still pay it's debts with it's gold.

That's the Reader's Digest version answer to your question.

If you wish, feel free to post a follow-up focused on a specific point.