Prof. Carol Quigley, "Tragedy and Hope": Why the Bankers & Gov hate the Gold standard

[FrankRep]

Prof. Carol Quigley, "Tragedy and Hope": Why the Bankers & Gov hate the Gold standard

I will simply post the section of the book that talks about why the government and bankers wanted to get off the gold standard. It's interesting to see it from their perspective. There's many more sections on this subject in the book, but I'll just post this section.


Tragedy and Hope: A History of the World in Our Time (1966)
Prof. Carol Quigley

Hardcover: 1348 pages


QUOTE:

The Supply of Money

We have said that two of the five factors which determined the value of money (and thus the price level of goods) are the supply and the demand for money. The supply of money in a single country was subject to no centralized, responsible control in most countries over recent centuries. Instead, there were a variety of controls of which some could be influenced by bankers, some could be influenced by the government, and some could hardly be influenced by either. Thus, the various parts of the pyramid of money were but loosely related to each other. Moreover, much of this looseness arose from the fact that the controls were compulsive in a deflationary direction and were only permissive in an inflationary direction.

This last point can be seen in the fact that the supply of gold could be decreased but could hardly be increased. If an ounce of gold was added to the point of the pyramid in a system where law and custom allowed To percent reserves on each level, it could permit an increase of deposits equivalent to $2067 on the uppermost level. If such an ounce of gold were withdrawn from a fully expanded pyramid of money, this would compel a reduction of deposits by at least this amount, probably by a refusal to renew loans.

The Money Power Persuaded Governments to Establish a Deflationary Monetary Unit

Throughout modern history the influence of the gold standard has been deflationary, because the natural output of gold each year, except in extraordinary times, has not kept pace with the increase in output of goods. Only new supplies of gold, or the suspension of the gold standard in wartime, or the development of new kinds of money (like notes and checks) which economize the use of gold, have saved our civilization from steady price deflation over the last couple of centuries. As it was, we had two long periods of such deflation from 1818 to 1850 and from 1872 to about 1897. The three surrounding periods of inflation (1790-1817, 1850-1872, 1897-1921) were caused by (1) the wars of the French Revolution and Napoleon when most countries were not on gold; (2) the new gold strikes of California and Alaska in 1849-1850, followed by a series of wars, which included the Crimean War of 1854-1856, the Austrian-French War of 1859, the American Civil War of 1861-1865, the Austro-Prussian and Franco-Prussian wars of 1866 and 1870, and even the Russo-Turkish War of 1877; and (3) the Klondike and Transvaal gold strikes of the late 1890's, supplemented by the new cyanide method of refining gold (about 1897) and the series of wars from the Spanish-American War of 1898-1899, the Boer War of 1899-1902, and the Russo-Japanese War of 1904-1905, to the almost uninterrupted series of wars in the decade 1911-1921. In each case, the three great periods of war ended with an extreme deflationary crisis (1819, 1873, 1921) as the influential Money Power persuaded governments to reestablish a deflationary monetary unit with a high gold content.

Money Power Is More Concerned With Money Than Goods

The obsession of the Money Power with deflation was partly a result of their concern with money rather than with goods, but was also founded on other factors, one of which was paradoxical. The paradox arose from the fact that the basic economic conditions of the nineteenth century were deflationary, with a money system based on gold and an industrial system pouring out increasing supplies of goods, but in spite of falling prices (with its increasing value of money) the interest rate tended to fall rather than to rise. This occurred because the relative limiting of the supply of money in business was not reflected in the world of finance where excess profits of finance made excess funds available for lending. Moreover, the old traditions of merchant banking continued to prevail in financial capitalism even to its end in 1931. It continued to emphasize bonds rather than equity securities (stocks), to favor government issues rather than private offerings, and to look to foreign rather than to domestic investments. Until 1825, government bonds made up almost the whole of securities on the London Stock Exchange. In 1843, such bonds, usually foreign, were 80 percent of the securities registered, and in 1875 they were still 68 percent. The funds available for such loans were so great that there were, in the nineteenth century, sometimes riots by subscribers seeking opportunities to buy security flotations; and offerings from many remote places and obscure activities commanded a ready sale. The excess of savings led to a fall in the price necessary to hire money, so that the interest rate on British government bonds fell from 4.42 percent in 1820 to 3.11 in 1850 to 2.76 in 1900. This tended to drive savings into foreign fields where, on the whole, they continued to seek government issues and fixed interest securities. All this served to strengthen the merchant bankers' obsession both with government influence and with deflation (which would increase value of money and interest rates).

Banker Policies Lead to Inflation and Deflation

Another paradox of banking practice arose from the fact that bankers, who loved deflation, often acted in an inflationary fashion from their eagerness to lend money at interest. Since they make money out of loans, they are eager to increase the amounts of bank credit on loan. But this is inflationary. The conflict between the deflationary ideas and inflationary practices of bankers had profound repercussions on business. The bankers made loans to business so that the volume of money increased faster than the increase in goods. The result was inflation. When this became clearly noticeable, the bankers would flee to notes or specie by curtailing credit and raising discount rates. This was beneficial to bankers in the short run (since it allowed them to foreclose on collateral held for loans), but it could be disastrous to them in the long run (by forcing the value of the collateral below the amount of the loans it secured). But such bankers' deflation was destructive to business and industry in the short run as well as the long run.

Changing the Quality of Money

The resulting fluctuation in the supply of money, chiefly deposits, was a prominent aspect of the "business cycle." The quantity of money could be changed by changing reserve requirements or discount (interest) rates. In the United States, for example, an upper limit has been set on deposits by requiring Federal Reserve member banks to keep a certain percentage of their deposits as reserves with the local Federal Reserve Bank. The percentage (usually from 7 to 26 percent) varies with the locality and the decisions of the Board of Governors of the Federal Reserve System.

Central Banks Vary Money in Circulation

Central banks can usually vary the amount of money in circulation by "open market operations" or by influencing the discount rates of lesser banks. In open market operations, a central bank buys or sells government bonds in the open market. If it buys, it releases money into the economic system; if it sells it reduces the amount of money in the community. The change is greater than the price paid for the securities. For example, if the Federal Reserve Bank buys government securities in the open market, it pays for these by check which is soon deposited in a bank. It thus increases this bank's reserves with the Federal Reserve Bank. Since banks are permitted to issue loans for several times the value of their reserves with the Federal Reserve Bank, such a transaction permits them to issue loans for a much larger sum.

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This is truly interesting stuff. If you want to study the globalist mindset, this is the book for you!

 

[humanic]

The following was written by G. Edward Griffin, who wrote The Creature From Jekyll Island and appears alongside Ron Paul in Fiat Empire and America: Freedom To Fascism. Read the full essay here.

One of the best authorities on the social and political vision of Cecil Rhodes was Carroll Quigley, a highly respected history professor at Georgetown University. One of Quigley’s former students was President Clinton. In Clinton’s nomination acceptance speech on July 16, 1992, he mentioned Quigley and paid tribute to him as his mentor. He mentioned Quigley many times after that in other public speeches as well. Clearly, Clinton was profoundly affected by his exposure to Quigley’s ideas twenty-seven years earlier, and we may assume that the relationship between teacher and student was similar to that between Ruskin and Rhodes.

The significance of this intellectual bond is that Carroll Quigley taught the conspiratorial view of history – as explained by the conspirators themselves. He admired the conspiracy. He was close to it for much of his life, and was considered by many to be its historian. So, when President Clinton paid tribute to Professor Quigley, his remarks carried two messages. To the average person, he was merely honoring some nice, kindly professor for providing intellectual inspiration. But, to those who knew Quigley’s status, it was an embedded message that the new president was aware of the conspiracy and was in its service.

QUIGLEY SUMMARIZED

If reading one-thousand seven-hundred pages or dry history is not high on your list of
things to do, then here is a summary of Quigley’s message regarding the hidden hand behind world events:

At the end of the 19th Century, a secret society was formed by Cecil Rhodes.
Most of his great wealth was given to extend this organization throughout the world.
It exists today and has been a major historical force since World War I.
Its original goal was to extend the British Empire and Anglo-Saxon culture
throughout the world. It soon evolved into something even bigger in scope. The goal
became world government of an international character based on the model of
collectivism ruled from behind the scenes by an oligarchy composed of those who
are loyal to the secret society.

The primary method of conquest is to infiltrate and capture control of the
power centers of society. (Power centers are those organizations and institutions that
wield influence over political action and public opinion.) Once the power centers are
controlled, the nation will follow. People believe that organizations respond to the
will of their membership, not realizing that they respond, instead, to the will of their
leadership.

The structure of the secret society is based on the classical conspiracy model
taken from Adam Weishaupt’s Illuminati. There is no reason to think that Rhodes
was a member of the Illuminati, which according to Bavarian records, was disbanded
there in 1784. However, there is no doubt that he had studied it carefully, because the
structure he chose was modeled after it. It is characterized by organizational rings
within rings. At the center is the leader and a few trusted associates called the Elect.
These people create a slightly larger organization around themselves, which attracts
members who have no knowledge that there is an inner core of direction. This outer
ring then creates another, larger organization around itself with the same relationship
to its inner ring of control. The larger organization then creates yet another larger
organization, and so forth. These rings extend outward until, finally, they reach into
the mainstream community where they enlist the services of innocent people who
perform various tasks of the secret society without realizing who is creating the
agenda or why

Members of the outer rings are not allowed to see the existence of the inner
rings. Only those few who prove themselves worthy are shown the deeper connection
and invited to advance. It is through this structure that a small group of men can
direct the activities of mass organizations and determine the policies of nations.

One of the benefits of this structure is that the Rhodes Secret Society, although
it has attained extensive power, remains invisible to the casual observer. Also of
benefit in this regard is the fact that it avoids a formal name. Quigley vacillates
between calling it The Group and The Network. Others call it The Rhodes Secret
Society. But it has no name! Without a name, it is difficult to even discuss it, much
less expose it. The result is a high degree of invisibility.

The inner circle of this conspiracy is called the Society of the Elect.
Originally, it consisted of Rhodes and a small brain trust from British banking and
politics. After Rhodes’ death, and with the arrival of such powerful participants as
Andrew Carnegie, J.P. Morgan, and John D, Rockefeller, the center of gravity began
to shift from London to New York and eventually came to rest in the Rockefeller
group with additional centers of influence in such organizations as the Bilderberg
Group and the Trilateral Commission. It was at this point that the goal also shifted
from the expansion of the British Empire to the creation of global collectivism.

The secondary ring around the Society of the Elect is called The Round Table.
It was established with branches in Britain, each of the British dependencies, and the
United States. These, in turn, created outer rings in each country as front groups for
the inner Round Tables. In Britain and it dependencies, the outer rings are called The
Royal Institute for International Affairs. In Britain, it is informally known as
Chatham House, named after the 18th century mansion in which it is located once
occupied by William Pitt, First Earl of Chatham. The word Royal is not attractive to
Americans; so, in the United States, the outer ring was called The Council on Foreign
Relations.

After a hundred years of penetration into the power centers of the Western
World, this Network now is close to the final achievement of its goal: the creation of
a true world government based on the model of collectivism.​

It is important to recall that the Rhodes Secret Society has primary influence in the Western World or, more specifically, those countries that have spun off from British rule. It also is influential in those parts of the world where American military and economic presence is strong. In most of the rest of the world, the dominant force is Leninism which – and it cannot be repeated too often – has the same goal of establishing a global government based on the model of collectivism but is a fierce competitor with the Rhodesians over which faction will rule.

 

[FrankRep]

The following was written by G. Edward Griffin, who wrote The Creature From Jekyll Island and appears alongside Ron Paul in Fiat Empire and America: Freedom To Fascism. Read the full essay here.

I truly love "The Creature From Jekyll Island, " written by G. Edward Griffin.

I'm 3/4 the way through it now.

 

[humanic]

I truly love "The Creature From Jekyll Island, " written by G. Edward Griffin.

I'm 3/4 the way through it now.

Put this next on your list if you haven't read it yet. Much quicker read, and equally good!

For those who are interested: The text I pasted earlier in this thread is from Griffin's essay, Secret Societies and Hidden Agendas, which is available here. Secret Societies and Hidden Agendas is Part 2 of a five part series entitled The Future Is Calling. Read the entire things in the Issues section of Freedom Force International's website (near bottom), or download parts 1-4 as a single PDF here.

Here's more from Secret Societies and Hidden Agendas by G. Edward Griffin:

--------------------------------------------

LET THE CONSPIRATORS THEMSELVES DESCRIBE IT

Many will find it difficult to believe that this summary of history is accurate; so, now let’s allow the conspirators themselves to describe it in their own words. In his book, Quigley says:

I know of the operation of this network because I have studied it for twenty years and was permitted for two years during the 1960’s to examine its papers and secret records. I have no aversion to it or to most of its aims and have for much of my life been close to it and to many of its instruments. In general my chief difference of opinion is that it wishes to remain unknown.​

In The Anglo-American Establishment Quigley says:

The Rhodes scholarship established by the terms of Cecil Rhodes’ seventh will are known to everyone. What is not so widely known is that Rhodes, in five previous wills, left his fortune to form a secret society, which was to devote itself to the reservation and expansion of the British Empire. And what does not seem to be known to anyone is that this secret society … continues to exist to this day. To be sure, [it] is not a childish thing like the Ku Klux Klan, and it does not have any secret robes, secret handclasps, or secret passwords. It does not need any of these, since its members know each other intimately. It probably has no oaths of secrecy nor any formal procedure of initiation. It does, however, exist and holds secret meetings…. This Group is, as I shall show, one of the most important historical facts of the twentieth century.​

One of the leaders and organizers of this secret society was William Stead who wrote a book entitled The Last Will and Testament of CJ Rhodes. In that book, he said:

Mr. Rhodes was more than the founder of a dynasty. He aspired to be the creator of one of those vast semi-religious, quasi-political associations which, like he Society of Jesus, have played so large a part in the history of the world. To be more strictly accurate, he wished to found an Order as the instrument of the will of the Dynasty…

I contend that we [English] are the finest race in the world and that the more of the world we inhabit the better it is for the human race…. What scheme could we think of to forward this object? I look into history and I read the story of the Jesuits. I see what they were able to do in a bad cause and I might say under bad leaders. In the present day I became a member of the Masonic order. I see the wealth and power they possess, the influence they hold, and I think over their ceremonies, and I wonder that a large body of men can devote themselves to what at times appear the most ridiculous and absurd rites without an object and without an end. The idea gleaming and dancing before one’s eyes, like a will-of-the wisp, at last frames itself into a plan. Why should we not form a secret society with but one object: the furtherance of the British Empire and the bringing of the whole uncivilized world under British rule.​

In Quigley’s words, the goal of this secret society was:

… nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. The system was to be controlled in a feudalist fashion by the central banks of the world acting in concert by secret agreements arrived at in frequent private meetings and conferences. The apex of the system was to be the Bank for International Settlements in Basil, Switzerland, a private bank owned and controlled by the world’s central banks which were themselves private corporations. Each central bank …sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world.​

On page 4 of The Anglo-American Establishment, Quigley says:

This organization has been able to conceal its existence quite successfully, and many of its most influential members, satisfied to possess the reality rather than the appearance of power, are unknown even to close students of British history … partly because of the deliberate policy of secrecy which this Group has adopted, partly because the Group itself is not closely integrated but rather appears as a series of overlapping circles or rings partly concealed by being hidden behind formally organized groups of no obvious political significance.​