The London Connection,
The Hitler Connection,
World War One,
The Money Creators,
The Great Depression
excerpted from the book
The Secrets of the Federal Reserve
by Eustace Mullins
Bankers Research Institute, 1983,
(originally published in 1952
as "Mullins on the Federal Reserve")
Benjamin Disraeli, Prime Minister of England during Queen Victoria'
The world is governed by very different
personages from what is imagined by those who are not behind the
Because of England's loss of her colonial empire after the Second
World War, it seemed that her influence as a world political power
was waning. Essentially, this was true. The England of 1980 is
not the England of 1880. She no longer rules the waves; she is
a second rate, perhaps thud rate, military power, but paradoxically,
as her political and military power waned, her financial power
grew. In 'Capital City' we find, "On almost any measure you
care to take, London is the world's leading financial centre...
In the 1960s London dominance increased..."
A partial explanation of this fact is
Daniel Davison, head of London's Morgan
Grenfell, said, 'The American banks have brought the necessary
money, customers, capital and skills which have established London
in its present preeminence .... only the American banks have a
lender of last resort. The Federal Reserve Board of the United
States can, and does, create dollars when necessary. Without the
Americans, the big dollar deals cannot be put together. Without
them, London would not be credible as an international financial
London is the world's financial center, because it can command
enormous amounts of capital, created at its command by the Federal
Reserve Board of the United States.
... The majority stock of the Federal
Reserve Bank of New York was purchased by three New York City
banks: First National Bank, National City Bank, and the National
Bank of Commerce. An examination of the principal stockholders
in these banks, in 1914, and today, reveals a direct London connection.
The astounding idea that the Federal Reserve System of the United
States is actually operated from London will probably be rejected
at first hearing by most Americans. However, Minsky has become
famous for his theory of the "dominant frame He states that
in any particular situation, there is a "dominant frame"
to which everything in that situation is related and through which
it can be interpreted. The "dominant frame" in the monetary
policy decisions of the Federal Reserve System is that these decisions
are made by those who stand to benefit most from them. At first
glance, this would seem to be the principal stockholders of the
Federal Reserve Bank of New York. However ... these stockholders
all have a "London Connection The "London Connection"
becomes more obvious as the dominant power when we find in [the
book] 'The Capital City', that only seventeen firms are allowed
to operate as merchant bankers in the City of London, England's
financial district. All of them must be approved by the Bank of
England. In fact, most of the Governors of the Bank of England
come from the partners of these seventeen firms... five merchant
banking firms of London actually control the New York banks which
own the controlling interest in the Federal Reserve Bank of New
... The London merchant bankers, with
their power to set the price of gold each day, become the final
arbiters of the volume of money and the price of money in those
countries which must bow to their power. Not the least of these
is the United States. No official of the Federal Reserve Bank
of New York, or of the Federal Reserve Board of Governors, can
command the power over the money of the world which is held by
these London merchant bankers. Great Britain, while waning in
political and military power, today exercises the greatest financial
power. It is for this reason that London is the present financial
center of the world.
J. Henry Schroder Banking Company is listed as Number 2 in capitalization
[in the book] 'Capital City' on the list of the seventeen merchant
bankers who make up the exclusive Accepting Houses Committee in
Victor Perlo, in the book The Empire of High Finance
The Hitler government made the London
Schroder Bank their financial agent in Britain and America.
The Heritage Foundation has ... been an important factor in the
policy-making of the Reagan Administration... the Heritage Foundation
is part of the Tavistock Institute network, directed by British
Intelligence. The financial decisions are still made at the Bank
of England, and who is head of the Bank of England? Sir Gordon
Richardson, chairman of J. Henry Schroder Co. of London and New
York from 1962 to 1972, when he became Governor of the Bank of
England. The "London Connection" has never been more
firmly in the saddle of the United States Government.
From 1887 to 1914, [a] precarious system of heavily armed but
bankrupt European nations endured, while the United States continued
to be a debtor nation, borrowing money from abroad, but making
few international loan because we did not have a central bank
or "mobilization of credit". The system of national
loans developed by the Rothschilds served to finance European
struggles during the nineteenth century, because they were spread
out over Rothschild branches in several countries. By 1900, it
was obvious that the European countries could not afford a major
war. They had large standing armies, universal military service,
and modern weapons, but their economies could not support the
enormous expenditures. The Federal Reserve System began operations
in 1914, forcing the American people to lend the Allies twenty-five
billion dollars which was not repaid, although considerable interest
was paid to New York bankers. The American people were driven
to make war on the German people with whom we had no conceivable
political or economic quarrel.
Cordell Hull, in his Memoirs:
The conflict [World War I] forced the
further development of the income-tax principle. Aiming, as it
did, at the one great untaxed source of revenue, the income-tax
law had been enacted in the nick of time to meet the demands of
war. And the conflict also assisted the putting into effect of
the Federal Reserve System, likewise in the nick of time.
The [international] bankers had been waiting since 1887 for the
United States to enact a central bank plan so that they could
finance a European war among the nations whom they had already
bankrupted with armament and "defense' programs. The most
demanding function of the central bank mechanism is war finance.
The World War[ I] was a matter of economic
When the Communist Revolution seemed in
doubt, Wilson sent his personal emissary, Elihu Root, to Russia
with one hundred million dollars from his Special Emergency War
Fund to save the toppling Bolshevik regime.
Bernard Baruch, testifying before the Nye Committee on September
All wars are economic in their origin.
[There is a] linear connection between the Rothschilds and the
Bank of England, and the London banking houses which ultimately
control the Federal Reserve Banks through their stockholdings
of bank stock and their subsidiary firms in New York. The two
principal Rothschild representatives in New York, J.P. Morgan
Co. and Kuhn, Loeb & Co. were the firms which set up the Jekyll
Island conference at which the Federal Reserve Act was drafted,
who directed the subsequent successful campaign to have the plan
enacted into law by Congress, and who purchased the controlling
amounts of stock in the Federal Reserve Bank of New York in 1914.
These firms had their principal officers appointed to the Federal
Reserve Board of Governors and the Federal Advisory Council in
The Henry Schroder Banking Company encompasses the entire history
of the twentieth century... The head of the Bank of England since
1973, Sir Gordon Richardson, Governor of the Bank of England (controlled
by the House of Rothschild), was chairman of Henry Schroder Wagg
and Company of London from 1963-72, and director of Henry Schroder,
New York, and Schroder Banking Corporation, New York, as well
as Lloyd's Bank of London, and Rolls Royce. He maintains a residence
on Sutton Place in New York City, arid as head of 'The London
Connection' can be said to be the single most influential banker
in the world.
The bankers at the conference [Versailles Peace Conference ending
World War I] convinced [President Woodrow] Wilson that they needed
an international government to facilitate their international
monetary operations. Vol. IV, p. 52, Intimate Papers of Cot. House
quotes a message from Sir William Wiseman to Lord Reading, August
16, 1918, "The President has two main principles in view;
there must he a League of Nations and it must be virile."
Wilson, who seems to have lived in a world
of fantasy, was shocked when American citizens booed him during
his campaign to have them sign over their hard won independence
to what appeared to many to be an international dictatorship.
He promptly went into a depression, and retired to his bedroom.
His wife immediately shut the White House doors against Col. House,
and from September 25, 1919 to April 13, 1920, she ruled the United
States with the aid of an intimate friend, her "military
aide", Col. Rixey Smith. As everyone was shut out of their
deliberations, no one ever knew which of the pair functioned as
the President, and which was the Vice President.
The admirers of Woodrow Wilson were led
for decades by Bernard Baruch, who stated that Woodrow Wilson
was the greatest man he ever knew. Wilson's appointments to the
Federal Reserve Board, and that body's responsibility for financing
the First World War, as well as Wilson's handing over the United
States to the immigrant triumvirate during the War, made him appear
to he the most important single effector of ruin in American history.
It is no wonder that after his abortive
trip to Europe, where he was hissed and jeered in the streets
by the French people, and snickered at in the halls of Versailles
by Orlando and Clemenceau, Woodrow Wilson returned home to take
to his bed. The sight of the destruction and death in Europe,
for which he was directly responsible, was perhaps more of a shock
than he could bear.
The organization of powerful trusts in Russia under the guise
of Communism made possible the receipt of large amounts of financial
and technical help from the United States. The Russian aristocracy
had been wiped out because it was too inefficient to manage a
modem industrial state. The international financiers provided
funds for Lenin and Trotsky to overthrow the Czarist regime and
keep Russia in the First World War. Peter Drucker, spokesman for
the oligarchy in America, declared in an article in the Saturday
Evening Post in 1948, that:
RUSSIA IS THE IDEAL OF THE MANAGED ECONOMY
TOWARDS WHICH WE ARE MOVING:
... Admiral Kolchak, leader of the White
Russian armies, was supported by the international bankers, who
sent British and American troops to Siberia in order to have a
pretext for printing Kolchak rubles
... The international gold dealings of
the Federal Reserve System, its active support in helping the
League of Nations to force all the nations of Europe and South
America back on the gold standard for the benefit of international
gold merchants like Eugene Meyer, Jr. and Albert Strauss, is best
demonstrated by a classic incident, the sterling credit of 1925.
J.E. Darling wrote, in the English periodical,
"Spectator' on January 10, 1925 that:
Obviously, it is of the first importance
to the United States to induce England to resume the gold standard
as early as possible. An American controlled Gold Standard, which
must inevitably result in the United States becoming the world's
supreme financial power, makes England a tributary and satellite,
and New York the world's financial centre.
Mr. Darling fails to point out that the
American people have as little to do with this as the British
people, and at resumption of the gold standard by Britain would
benefit only that small group of international merchants who own
the world's gold. No wonder that "Banker's Magazine!' gleefully
remarked in July, 1975-that:
"The outstanding event of the past
half year in the banking world was the restoration of the gold
The First World War changed the status
of the United States from that of a debtor nation to the position
of the world's greatest creditor nation, a title formerly occupied
by England. Since debt is money, according to the Governor Marriner
Eccles of the Federal Reserve Board, this also made us the richest
nation of the world. The war also caused the removal of the headquarters
of the world's acceptance market from London to New York, and
Paul Warburg became the most powerful trade acceptance banker
in the world. The mainstay of the international financiers, however,
remained the same. The gold standard was still the basis of foreign
exchange, and the small group of internationals who owned the
gold controlled the monetary systems of the Western nations.
Professor Gustav Cassel wrote in 1928:
"The American dollar, not the gold
standard, is the world's monetary standard. The American Federal
Reserve Board has the power to determine the purchasing power
of the dollar by making changes in the rate of discount, and thus
controls the monetary standard of the world."
The true allegiance of the members of the Federal Reserve Board
has always been to the central bankers. The three features of
the central bank [are] its ownership by private stockholders who
receive rent and profit for their use of the nation's credit,
absolute control of the nation's financial resources, and mobilization
of the nation's credit to finance foreigners.
Governor Marriner Eccles of the Federal Reserve Board stated before
the House Banking and Currency Committee that; "Debt is the
basis for the creation of money."
The League of Nations had achieved its goal of getting the nations
of Europe back on the gold standard by 1928, but three-fourths
of the world's gold was in France and the United States. The problem
was how to get that gold to countries which needed it as a basis
for money and credit. The answer was action by the Federal Reserve
Following the secret meeting of the Federal
Reserve Board and the heads of the foreign central banks in 1927,
the Federal Reserve Banks in a few months doubled their holdings
of Government securities and acceptances, which resulted in the
exportation of five hundred million dollars in gold in that year.
The System's market activities forced the rates of call money
down on the Stock Exchange, and forced gold out of the country.
Foreigners also took this opportunity to purchase heavily in Government
securities because of the low call money rate.
"The agreement between the Bank
of England and the Washington Federal Reserve authorities many
months ago was that we would force the export of 725 million of
gold by reducing the bank rates here, thus helping the stabilization
of France and Europe and putting France on a gold basis."'
(April 20, 1928)
On February 6, 1929, Mr. Montagu Norman,
Governor of the Bank of England, came to Washington and had a
conference with Andrew Mellon, Secretary of the Treasury. Immediately
after that mysterious visit, the Federal Reserve Board abruptly
changed its policy and pursued a high discount rate policy, abandoning
the cheap money policy which it had inaugurated in 1927 after
Mr. Norman's other visit. The stock market crash and the deflation
of the American people's financial structure was scheduled to
take place in March. To get the ball rolling, Paul Warburg gave
the official warning to the traders to get out of the market.
In his annual report to the stockholders of his International
Acceptance Bank, in March, 1929, Mr. Warburg said:
"If the orgies of unrestrained speculation
are permitted to spread, the ultimate collapse is certain not
only to affect the speculators themselves, but to bring about
a general depression involving the entire country".
During three years of "unrestrained
speculation", Mr. Warburg had not seen fit to make any remarks
about the condition of the Stock Exchange. A friendly organ, The
New York Times, not only gave the report two columns on its editorial
page, but editorially commented on the wisdom and profundity of
Mr. Warburg's observations. Mr. Warburg's concern was genuine,
for the stock market bubble had gone much farther than it had
been intended to go, and the bankers feared the consequences if
the people realized what was going on. When this report in The
New York Times started a sudden wave of selling on the Exchange,
the bankers grew panicky, and it was decided to ease the market
somewhat. Accordingly, Warburg's National City Bank rushed twenty-five
million dollars in cash to the call money market, and postponed
the day of the crash.
The revelation of the Federal Reserve
Board's final decision to trigger he Crash of l929, appears, amazingly
enough, in The New York Times. On April 20, 1929, the Times headlined,
"Federal Advisory Council Mystery Meeting in Washington.
Resolutions were adopted by the council and transmitted to the
board, but their purpose was closely guarded. An atmosphere of
deep mystery was thrown about the proceedings both by the board
and the council. Every effort was made to guard the proceedings
of this extraordinary session. Evasive replies were given to newspaper
Only the innermost council of "The
London Connection" knew that it had been decided at this
"mystery meeting" to ring down the curtain / on the
greatest speculative boom in American history. Those in the know
began to sell off all speculative stocks and put their money in
government ( bonds. Those who were not privy to this secret information,
and they / included some of the wealthiest men in America, continued
to hold their speculative stocks and lost everything they had.
In "FDR, My Exploited Father-in-Law",
Col. Curtis B. Dall, who was a broker on Wall Street at that time,
writes of the Crash, "Actually it was the calculated 'shearing'
of the public by the World Money-Powers, triggered by the planned
sudden shortage of the supply of call money in the New York money
market." Overnight, the Federal Reserve System had raised
the call rate to twenty percent. Unable to meet this rate, the
speculators' only alternative was to jump out of windows.
The New York Federal Reserve Bank rate,
which dictated the national interest rate, went to six percent
on November 1, 1929. After the investors had been bankrupted,
it dropped to one and one-half percent on May 8, 1931. Congressman
Wright Patman in "A Primer On Money", says that the
money supply decreased by eight billion dollars from 1929 to 1933,
causing 11,630 banks of the total of 26, 401 in the United States
to go bankrupt and close their doors.
The Federal Reserve Board had already
warned the stockholders of the Federal Reserve Banks to get out
of the Market, on February 6, 1929, but it had not bothered to
say anything to the rest of the people. Nobody knew what was going
on except the Wall Street bankers who were running the show.
Not only was the Federal Reserve System responsible for the First
World War, which it made possible by enabling the United States
to finance the Allies, but its policies brought on the world-wide
depression of 1929-31. Governor Adolph C. Miller stated at the
Senate Investigation of the Federal Reserve Board in 1931 that:
"If we had had no Federal Reserve
System, I do not think we would have had as bad a speculative
situation as we had, to begin with."
Carter Glass replied, "You have made
it clear that the Federal Reserve Board provided a terrific credit
expansion by these open market transactions."
Emmanuel Goldenweiser said, "In 1928-29
the Federal Board was engaged in an attempt to restrain the rapid
increase in security loans and in stock market speculation. The
continuity of this policy of restraint, however, was interrupted
by reductions in bill rates in the autumn of 1928 and the summer
Both J. P Morgan and Kuhn, Loeb Co. had
"preferred lists" of men whom they sent advance announcements
of profitable stocks... The men on these lists were fellow bankers,
prominent industrialists, powerful city politicians, national
Committeemen of the Republican and Democratic Parties, and rulers
of foreign countries. The men on these lists were notified of
the coming crash, and sold all but so-called gilt-edged stocks,
General Motors, Dupont, etc. The prices on these stocks also sank
to record lows, but they came up soon afterwards. How the big
bankers operated in 1929 is revealed by a Newsweek story on May
30, 1936, when a Roosevelt appointee, Ralph W. Morrison, resigned
from the Federal Reserve Board:
"The consensus of opinion is that
the Federal Reserve Board has lost an able man. He sold his Texas
utilities stock to Insull for ten million dollars, and in 1929
called a meeting and ordered his banks to close out all security
loans by September 1. As a result, they rode through the depression
with flying colors?'
Predictably enough, all of the big bankers
rode through the depression "with flying colors:' The people
who suffered were the workers and farmers who had invested their
money in get-rich stocks, after the President of the United States,
Calvin Coolidge, and the Secretary of the Treasury, Andrew Mellon,
had persuaded them to do it.
There had been some warnings of the approaching
crash in England, which American newspapers never saw. The London
Statist on May 25, 1929 said:
"The banking authorities in the
United States apparently want a business panic to curb speculation".
The London Economist on May 11, 1929,
"The events of the past year have
seen the beginnings of a new technique, which, if maintained and
developed, may succeed in 'rationing the speculator without injuring
Governor Charles S. Hamlin quoted this
statement at the Senate hearings in 1931 and said, in corroboration
"That was the feeling of certain
members of the Board, to remove Federal Reserve credit from the
speculator without injuring the trader".
Governor Hamlin did not bother to point
out that the "speculators" he was out to break were
the school-teachers and small town merchants who had put their
savings into the stock market, or that the "traders"
he was trying to protect were the big Wall Street operators, Bernard
Baruch and Paul Warburg.
When the Federal Reserve Bank of New York
raised its rate to six percent on August 9, 1929, market conditions
began which culminated in tremendous selling orders from October
24 into November, which wiped out a hundred and sixty billion
dollars worth of security values. That was a hundred and sixty
billions which the American citizens had one month and did not
have the next. Some idea of the calamity may be had if we remember
that our enormous outlay of money and goods in the Second World
War amounted to not much more than two hundred billions of dollars,
and a great deal of that remained as negotiable securities in
the national debt. The stock market crash is the greatest misfortune
which the United States has ever suffered.
What had caused the  crash? The people had purchased stocks
at high prices and expected the prices to continue to rise. The
prices had to come down, and they did. It was obvious to the economists
and bankers gathered over their brandy and cigars at the Hotel
Astor that the people were at fault. Certainly the people had
made a mistake in buying overpriced securities, but they had been
talked into it by every leading citizen from the President of
the United States on down. Every magazine of national circulation,
every big newspaper, and every prominent banker, economist, and
politician, had joined in the big confidence game of urging people
to buy those over-priced securities. When the Federal Reserve
Bank of New York raised its rate to six percent, in August 1929,
people began to get out of the market, and it turned into a panic
which drove the prices of securities down far below their natural
levels. As in previous panics, this enabled both Wall Street and
foreign operators in the know to pick up "blue-chip"
gilt-edged" securities for a fraction of their real value.
The New York Times reported on April 7, 1931, "Montagu Norman,
Governor of the Bank of England, conferred with the Federal Reserve
Board here today. Mellon, Meyer, and George L. Harrison, Governor
o the Federal Reserve Bank of New York, were present".
The London Connection had sent Norman
over this time to ensure that the Great Depression was proceeding
according to schedule. Congressman Louis McFadden had complained,
as reported in The New York Times, July 4, 1930, "Commodity
prices are being reduced to 1913 levels. Wages are being reduced
by the labor surplus of four million unemployed. The Morgan control
of the Federal Reserve System is exercised through control of
the Federal Reserve Bank of New York, the mediocre representation
and acquiescence of the Federal Reserve Board in Washington?'
As the depression deepened, the trust's lock on the American economy
strengthened, but no finger was pointed at the parties who were
trolling the system.
of the Federal Reserve