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nydus/The Legalized Crime of BankingPublic

Silas Walter Adams critiques the Federal Reserve Banking System, arguing that its monetary policies have significantly inflated the costs of war and national debt. The book examines the historical impact of private banking practices on the American economy and proposes a constitutional alternative for the management of the nation's money supply.

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Table of Contents

Chapter XVI Setting Up Lending Agencies

of their lending, its extent and its coverage; so if Congress felt that additional deposits to the credit of the lender, or lenders would be in the interest of the public's good, and not unduly increase the volume of money, Congress would say to the lenders, "Give the Treasury your note for the $10 million, and attached collateral worth three times the loan, say $30 million; and the Treasurer will give you a cheque which you may deposit in your home Depository, which will increase your loan range $10 million — not $50 million, as is the case under the Reserve System. And all of that $10 million would be earmarked for lending. An officer of the Deposit Lenders could not cheque out $5,000, and take the family on a world tour, or buy a yacht, or a ranch. It would be for lending; and the regulation of lending would enable the Government to know that every dollar went to borrowers on loans. The lenders would be compelled to live on the interest paid to them by borrowers. At the end of the loan period, say ten years, the lenders would have to give the Government a cheque against their deposits for $10 million, which would lower their lending deposit back to pre-loan period. The Treasury would not give the Government credit for the $10 million, which would automatically restore the total deposit credits to the pre-loan period, unless the Nation needed the additional deposits. As the lenders paid the Government $300,000 interest each year, totalling $3 million, the Treasurer would place this to the credit of the Government, which would be spent by the Government in paying for services and goods. It would be an "income" to the Government, to all of us, and would help defray the expenses of the Government. It would not be new deposits. Now, that would be putting the shoe on the other foot. Under the Reserve System, Uncle Sam must borrow his own credit, and not only pay interest on it, but pay the principal, or continue paying interest forever. Unlike the Bankers the Government would not take title to the $10 million loan, but would cancel it out, that it might not remain in circulation to cheapen other deposit credits. And the lender's note would not be for sale — it would lie in Treasury until paid. That would forever

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