Who Actually Owns the Fed and Why That Must End
Few questions of late have been asked more frequently or answered with less transparency than this one:
WHO OWNS THE FED?
The domain name for the official website is FederalReserve.gov, the “.gov” extension of which suggests that the Federal Reserve System (a.k.a. the “Fed”) is part of the United States government and therefore owned by the American taxpayers. But that is not the case. As the Fed itself states…
“The Federal Reserve System fulfills its public mission as an independent entity within government. It is not ‘owned’ by anyone and is not a private, profit-making institution. As the nation’s central bank, the Federal Reserve derives its authority from the Congress of the United States. It is considered an independent central bank because its monetary policy decisions do not have to be approved by the President or anyone else in the executive or legislative branches of government, it does not receive funding appropriated by the Congress, and the terms of the members of the Board of Governors span multiple presidential and congressional terms.”
Parts of that statement are true, sort of, and parts of that statement are not. Factcheck.org provides a better answer:
“There are actually 12 different Federal Reserve Banks around the country, and they are owned by big private banks. But the banks don’t necessarily run the show. Nationally, the Federal Reserve System is led by a Board of Governors whose seven members are appointed by the president and confirmed by the Senate… The concept of ‘ownership’ needs some explaining here, however. The member banks must by law invest 3 percent of their capital as stock in the Reserve Banks, and they cannot sell or trade their stock or even use that stock as collateral to borrow money. They do receive dividends of 6 percent per year from the Reserve Banks and get to elect each Reserve Bank’s board of directors. The private banks also have a voice in regulating the nation’s money supply and setting targets for short-term interest rates, but it’s a minority voice. Those decisions are made by the Federal Open Market Committee (FOMC), which has a dozen voting members, only five of whom come from the banks. The remaining seven, a voting majority, are the Fed’s Board of Governors who, as mentioned, are appointed by the president.”
That’s a better answer, but not a totally complete or correct one. Yes, there are 12 Federal Reserve Banks, all of which are owned by private banks, and all of which must pay dividends to their owners. So contrary to what it claims, the Fed is not only privately-owned but a for-profit enterprise. And yes, there *should* be 7 members of the FOMC appointed by the government and 5 appointed by the banks. In fact, however, for unstated reasons and for some time now there have been only 5 people seated on the FRB Board of Governors, none of whom are celebrated consumer advocates…
…which means government appointees do NOT outnumber bank appointees on the FOMC, and you can rest assured that the private banks DO “run the show”:
So the question then becomes:
WHICH PRIVATE BANKS CONTROL THE FED?
The Web is awash with lists and percentages on this one supported by nothing more than links that refer to other links that refer back to the original and often anonymous post. A notable exception is the work of Jake Towne, who in March of 2009 applied an admittedly imperfect but plausible engineering approach to the problem and, after some extensive research and number-crunching, concluded the following:
“[The] top 4 banks – Bank of America (BAC), JP Morgan Chase, Citigroup, and Wachovia – would control roughly 50% of the stock of the Federal Reserve Bank, and the top 10 banks, including Wells Fargo (WFC), HSBC (HBC), and the Bank of New York (BK), would control over 68% of the stock.”
So according to Jake, whoever ultimately controls these ten banks thereby also controls the Federal Reserve:
Bank of America Corp.
JPMorgan Chase & Co.
Wachovia Bank (subsequently acquired by Wells Fargo)
Wells Fargo N.A.
State Street Corp.
Bank of NY Mellon
TO RECAP… The Federal Reserve System that has used its debt-based currency to exploit our economy since 1913 is a private banking cartel consisting of 12 regional Federal Reserve Banks. Each of those banks are required to pay dividends to their shareholders, which makes them for-profit enterprises. Those shareholders are all private banks and obviously also for-profit enterprises that exist not to maintain the welfare of humankind – or even the American subset thereof – but rather to maximize the wealth of their shareholders.
AND WHO ARE THEIR SHAREHOLDERS?
Keep tracing your way up the ownership pyramid, and you may find some have (in)famous names like Rothschild, Rockefeller or Buffett. Others in this global elite we collectively refer to as “the 1%”. Either way, their interests align with those of the rest of us – “the 99%” – only in the same manner as those of shepherds and the sheep that they shear in good times and slaughter in bad.
This must end. And that is why the Fed must end.