than $250 billion U.S. bonds during World War II.
The Federal Reserve Banking System bought every bond, giving the Government deposit credit on the books of the Reserve Banks. The Federal Reserve Banking System is a 100% private corporation, "federal" in name only. Let's summarize the magic touch of bankers. The Treasury wrote cheques totalling $250 billion. The recipients deposited these cheques in commercial banks, creating $250 billion deposits to the credit of those who served the Nation, or sold the United States goods. Banks sent them to Reserve Banks, increasing their reserves $250 billion. Then the banks wrote on their books $1.25 trillion additional bank credits, which they could lend or use to buy securities, which would add $1.25 trillion in new bank deposits. These cheques of the Government first created $250 billion deposits then created $250 billion bank reserves, which ballooned into $1,250 billion Bank Credit! In due time the commercial banks will collect all loans and re-sell all securities. This will transfer from their customers' deposit accounts $1.25 trillion to the banks' profit account. Now let's total up banks' war profits: