Central Banking

International bankers have known they needed a way for taxpayers to bail them out since the beginning of international banking in the 1300's. The "way" could not be obvious to citizen taxpayers. Governments could not just let their legislatures vote to use taxpayer money to bail out banks, etc. So they developed a "way" that very few would understand.

The "way" they came up with was to create the first central bank, The Bank of England, in 1694. It was used to bail out banks and create money for Parliament.

America has had four central banks. Three have failed, starting with the first in 1781 and the last ending in 1836. In 1910, bankers began planning the fourth central bank which was created by the 1913 Federal Reserve Act and exists to this day. The purpose of this bank was to provide a system so that bankers would be bailed-out if their risky loans failed. They arranged it so that if they took unsuccessful risks using fractional reserve banking practices, a fail-safe central bank would bail them out with taxpayer money.

In order to get Congress to agree to pass this law, they needed to give Congress a trade-off (a quid pro quo). The trade-off was that when Congress wanted money it could receive the money in the form of monetized debt from the Federal Reserve and not have to notify taxpayers that they were being taxed by a hidden tax - inflation.