Creature From Jekyll Island by G. Edward полностью

2. The bank would be given a monopoly to issue banknotes which would circulate as England's paper currency;

3. The bank would create money out of nothing with only a fraction of its total currency backed by coin;

4. The monetary scientists then would loan the government all the money it needed;

5. The money created for government loans would be backed primarily by government I.O.U.s;

6. Although this money was to be created out of nothing and would cost nothing to create, the government would pay "interest" on it at the rate of 8%;

7. Government I.O.U.s would also be considered as "reserves" for creating additional loan money for private commerce. These loans also would earn interest. Thus, the monetary scientists would collect double interest on the same nothing.1

The circular which was distributed to attract subscribers to the Bank's initial stock offering explained: "The Bank hath benefit of interest on all the moneys which it, the Bank, creates out of nothing."2 The charter was issued in 1694, and a strange creature took its initial breath of life. It was the world's first central bank.

Rothbard writes:

1. For an overview of these agreements, see Murray Rothbard, The Mystery of Banking (New York: Richardson & Snyder, 1983), p. 180. Also Martin Mayer, The Bankers (New York: Weybright & Talley, 1974), pp. 24-25.

2. Quoted by Caroll Quigley, Tragedy and Hope: A History of the World in Our Time (New York: Macmillan, 1966), p. 49. Paterson did not benefit from his own creation-He withdrew from the Bank over a policy disagreement within a few months after its formation and then returned to Scotland where he succeeded in selling his Darien scheme. Frugal Scots thronged to buy stock and to book passage to the fever-ridden land. The stock became worthless and almost all the 1200 colonists lost their lives.

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In short, since there were not enough private savers willing tofinance the deficit, Paterson and his group were graciously willing tobuy g o v e r n m e n t b o n d s , p r o v i d e d they could do so withnewly-created out-of-thin-air bank notes carrying a raft of specialprivileges with them. This was a splendid deal for Paterson andcompany, and the government benefited from the flimflam of aseemingly legitimate bank's financing their debts.... As soon as theBank of England was chartered in 1694, King William himself andvarious members of Parliament rushed to become shareholders of thenew money factory they had just created.1

THE SECRET SCIENCE OF MONEY

Both groups within the Cabal were handsomely rewarded for their efforts. The political scientists had been seeking about

£500,000 to finance the current war. The Bank promptly gave them more than twice what they originally sought. The monetary scientists started with a pledged capital investment of £1,200,000.

Textbooks tell us that this was lent to the government at 8%

interest, but what is usually omitted is the fact that, at the time the loan was made, only £720,000 had been invested, which means the Bank "loaned" 66% more than it had on hand.2 Furthermore, the Bank was given the privilege of creating at least an equal amount of money in the form of loans to the public. So, after lending their capital to the government, they still had it available to loan out a second time.

An honest loan of their £720,000 at 8% would have yielded

£57,600 interest. But, with the new secret science, they were able to earn 8% on £1,200,000 given to the government plus an estimated 9% on £720,000 loaned to the public. That adds up to £160,800, more than 22% on their investment. The real point, however, is that, under these circumstances, it is meaningless to talk about a rate of interest. When money is created out of nothing, the true interest rate is not 8% or 9% or even 22%. It is infinity.

In this first official act of the world's first central bank can be seen the grand pretense that has characterized all those which have followed. The Bank pretended to make a loan but what it really did Was to manufacture the money for government's use. If the government had done this directly, the fiat nature of the currency would Rothbard, Mystery, p. 180.